DC: become a service provider or risk extinction

The channel must get over its "addiction to chunky deals" and "chunky sales commissions" if it wants to succeed in the cloud era.

Scott Frew, executive chairman of Distribution Central, made the claims at the official launch of the company's DC CloudSelect operation in Sydney last Thursday evening, following a similar event in Melbourne on Tuesday.

"Anyone who does not position themselves as some sort of service provider will not be in business in the next three years," said Frew.

The first cab off the rank for CloudSelect is the distie's hybrid Cloud POD solution, powered by Amazon Web Services (AWS), Equinix and NetApp.

According to Frew: "Cloud PODs are pre-designed and pre-configured cloud solution stacks – the first one we have launched with is NetApp Private Storage for AWS, housed at Equinix's data centre."

Both the Sydney and Melbourne events hosted resellers from across the distie's network, predominantly from the storage side of the business, as well as security.

Feedback from its channel partners has been strong so far, with Frew expecting the first customers up and running in the near future.

"There will be deployments going out in this quarter. I am not bullish enough to say it will be this month, but definitely this quarter."

The opportunity for resellers is clear, according to Distribution Central. "End users now have an array of cloud solutions available to them – public, private, hybrid or on-premise – and a host of vendor technologies that support those solutions.

"Only resellers have the relationship and insight into their customers' pain points to align their customers' business requirements with the right kind of cloud solution."

Frew explained to CRN that disties would play a key role in the cloud age.

"Our channel engagement models cover all spectrums of reseller from those that don’t know anything about the cloud to those that know everything but need help with the billing, logistics and the relationships with AWS, Equinix and NetApp."

For instance, Distribution Central can manage the complex billing cycle that goes hand in hand with a move to an annuity-based payment model.

He stressed that the distie is in a unique place to leverage its relationships with vendors to bring this solution to market. Neither AWS or Equinix have gone via a distributor until the Distribution Central deal and a similar arrangement with Avnet for North America, said Frew.

Vendors also get benefits from the two-tier supply model, said Frew, because Distribution Central can manage the risk that goes along with supplying a broad base of small businesses. "We are protecting Equinix and AWS from the credit risk out there, while they bring to me the ability to consolidate the supply of their services."