BYOD: main play or Pandora's Box?

BYOD is one of the fastest growing and most disruptive trends in the industry. With the volume and variety of devices flooding virtually unchecked into organisations, it’s probably fair to say the horse has well and truly bolted.

Everyone from senior blue chip executives to Gen Y staff are bringing their smartphones and tablets into the work environment, along with heightened expectations for their integration with corporate systems and applications.

For many in the channel this represents a loss of control over their customers. Furthermore for many IT managers, BYOD means a potential Pandora’s Box of security problems. Issues of mobile device management need to be considered, along with purchasing policies and policies governing usage.

At the 2012 CRN Fast50 awards in Sydney, CRN took to industry leaders to discuss the role of the reseller in BYOD.

ATTENDEES

Neville James, Citrix

Jason Brouwers, Cisco

Jeff Morris, Dell

Nick Verykios, Distribution Central

Jeff Hwong, Huawei

Ryan Parker, Netgear

Jamie Romanin, ShoreTel

Ashley Wearne, Sophos

Ahmed Issa, Synnex

David Lenz, Ingram Micro

CRN Neville James from Citrix, what do you see as the key opportunities being created by BYOD trend for the channel around mobile device management?

Neville The single biggest opportunity is that, unwittingly, lots of individuals – customers and staff – created something that as an industry, as vendors and as partners and resellers we’ve really struggled to do, and that is create a compelling event around desktop virtualisation.

For a long time we’ve been able to get customers excited about virtualisation, but then we always get stuck in their IT refresh cycles and if deals don’t go ahead it’s quite often because we haven’t been able to fit into that cadence.

I suggest that with BYOD - and this was alluded to earlier - it’s not BYOD: they’ve already brought their own devices. It should be BTOD, so whether you like it or not as a customer, there are devices in your environment, your data is going outside of your environment, it’s getting dropped into storage environments you have no control over. Or, in some cases, you have no idea where they are and that is a phenomenon you have to live with.

So from a channel and industry perspective, and obviously a vendor [Citrix] that’s actively involved in virtualisation I think BYOD has created the single most compelling event we’ve had for many a year.

CRN What do resellers need to understand about the latest wireless protocols such as 4G LTE and 80211ac in terms of the ability to support more sophisticated business applications and to provide their customers with greater flexibility?

Ryan Both of these technologies represent greater performance with regard to wireless connectivity for both devices inside the office, and then of course while workers are on the road. With 802.11ac it’s not a standard yet that’s ratified. It will be ratified early next year, and the benefit of that is that it brings gigabyte wireless to our devices.

Netgear as a company is already shipping 802.11ac in the consumer space, because consumers are already willing to adopt this technology. Particularly now we are more conscious about moving video content about our home, we’re looking for more bandwidth to be able to deliver that. In the business space it takes a compelling event for companies to invest in wireless networks that provide the mobility and flexibility around their offices.

When we look at LTE the story is very similar. We are talking about 100Mbps downloads, 50mb upload, which is equivalent to the DSL or wide broadband services we see today. From that point of view, for a small-medium business, it’s giving us bigger pipes to be able to deliver more of our workplace to our users while they’re on the road. It’s really going to enable video and voice anywhere we are, with high quality.

CRN Jeff Hwong from Huawei, in your view is video emerging as the new killer app for business mobility?

Jeff Hwong To answer this takes about two hours. Well, whether it’s going to be the killer app, we’re not sure, but obviously video is going to improve and enhance productivity in any organisation. If you look around, everyone has a smartphone. With better devices, wider screens, increased bandwidth, obviously video is going to be in the business mobility mix. 

The question is how can the resellers play a role in deploying video in the business applications? They have to move away from block selling and into what we call solution selling. The reseller has an important role to help customers understand the value proposition of video and mobility. Resellers will probably have to help the customer understand what is the current status of their infrastructure – are they ready for business mobility?

Everybody talks about business mobility with things like video coming into play. But you have to help your customer understand whether it makes sense to the business.

Last, I think everybody is concerned about the cost of the additional infrastructures, security concerns, and I think together with the resellers we can help business understand the benefits mobility will bring, inclusive of video. This is where the reseller has to move away from box selling to solution selling and with that, the reseller community will probably be a lot happier with BYOD than most.

CRN Ahmed Issa from Synnex, are we approaching anything resembling standards for mobile devices in the business world at the moment? For instance what do you think are the essential capabilities of the business smartphone?

Ahmed From the essential capability side, I believe the phone should have a very strong type of screen so to speak, but from a standard side, no, I don’t see that happening. There’s a wide range of devices in the marketplace, so there’s a common area a lot of people have, it’s the security aspect of the device. It’s more consumer driven.

The consumers have more say, because they know what they want and expect. So from an organisational perspective, people should decide. It’s the new trend. Mobility’s here to stay, but the security issue is a must and something we need to start controlling.

CRN So you think it will continue to be consumer driven or are we perhaps looking at the future reversal of that trend?

Ahmed No, I think definitely consumer driven. They know what they want. They know how to make things more seamless for them and for the user. If you go back to old days, IT was driven by businesses. But today I guess we look at the consumer and we see there’s a standard out there to make things easier for them, and they’re trying to implement that in their business. I don’t think the trend will ever change.

CRN Ashley Wearne, from Sophos, obviously one of the big concerns companies have around the BYOD trend is control and security. Do you see this trend providing opportunities around security for resellers to really get in there and be trusted advisers for security around mobility for their customers?

Ashley It goes without saying. Everyone says the same message. The thing that drives this is quite interesting, and that’s where we’ve come from, because we didn’t have a [security] industry at all when it was just mainframes, terminals and phones on your desk and in a very controlled environment; there were just no security issues. If you trace where that’s come to, where you get more devices and processing attached to networks and you let users fiddle around with the stuff, that’s where the security industry makes money.

Now of course with mobility everyone has even more devices attached to even more networks doing really quite important things on it. Users are not only fiddling around with it, but actually defining what you do with it.So this is really a sweet spot for the whole security industry, and it has to be with the partner. What we’re seeing is budgets set aside specifically for mobility, which won’t last. This is a one-time thing.

CRN Why don’t you think it will last?

Ashley Because you are going to solve the mobility thing, and it’s quickly going to become commoditised back into ‘it’s just security’ and it just happens to be focused on a new form factor for devices and we’ll get away from securing devices pretty quickly, and we’ll be securing the person irrespective of where they’re connected to.

So this is a one-time thing, and you want to get in now and have that conversation, and the sensible thing if you’re a partner, is rather than sell them something is get them on to a monthly type of subscription. You lock that budget in for 10 years; you’ve got to move away from the old way to a different business model that takes that money and gives you a revenue stream ongoing.

CRN Do you think this commoditisation and technology happening with mobility could eventually result in the security side of things being commoditised as well?

Ashley I just think the whole mobility thing will go away. It’s just something different today to what we have seen in the past so people are saying  ‘Oh now we can be mobile’. It’s not actually what it’s about. It’s sort of ‘bring your own cloud’, we’ve gone past the mobile stuff.

You ‘bring your own cloud’ and you’re bringing your Dropbox, you’re bringing your Gmail. That’s what it is. You’re attached to the internet wherever you go, irrespective of what you’re doing and your company can’t control you any more. It’s fascinating really.

CRN So a question for the whole panel: does the device really matter any more?

Nick No. The only reason I say that is because it never has, it’s what the device brings. The challenge that our channel has to solve for vendors, resellers and distributors is how we’re going to solve these contemporary business problems that are associated with what people are bringing. They’re bringing their own device sure, but they’ve been doing that forever.

They brought in their own calculators, 20 years ago or whatever, and it just goes on and on. What they’re bringing is applications; they’re bringing carrier plans; they’re bringing all kinds of elements that need a contemporary business problem to be solved. The device is irrelevant.

CRN Further to that Nick, is the growth in mobile business apps a business opportunity for the channel? If so how, do they go about getting involved?

Nick Well, it has to be. I can only speak from my perspective as an entrepreneur who speaks predominantly to entrepreneurs and business owners. It’s about what are you trying to solve for your customers.

There are a number of developments associated with this awful term BYOD, and if you go back about 15 years ago when remote access started to become important, everyone was trying to convince everyone that that was a new thing. It wasn’t, because three years before that we were flogging terminal servers and routers and calling them remote access.

Remote access has been around forever; it’s the applications that are driving these new trends, not the devices, it’s the securing of those devices and securing of the applications and understanding what to do with the information that’s coming in; the analysing of that information rather than the hoarding of the information, hoarding everything that’s into it, and it’s video-led as well.

The device is starting to come of age because it is video-led and it’s bringing the data with it. It’s almost like the voice application is just starting to become secondary. So for resellers I would advise two things.

First of all forget about the device and start thinking about what it’s bringing, because that’s what your customer’s solution is around, and what you have to solve. The second thing is forget about the vendors. The vendor’s not bringing a big points margin in to you. They’re bringing in a two or three points margin, and you think you’re getting a good deal, because you’re representing one of them. Forget it. Build a business around $200,000 at 20 points, not $2 million for five. It will kill you.

CRN Jamie Romanin from ShoreTel, the term ‘unified communications’ has been around for several years now. Where is the industry at in your view and what are the key things that resellers need to do to develop opportunities in this space?

Jamie BYOD is really a symptom of a bigger change and that’s the smartphone and the user. With regard to UC, it’s no longer a bolt-on or add-on on top of an IP telephony solution. It’s expected as the norm, so customers want to do instant messaging and presence and point one video and collaboration through their telephony solution today. That’s what they expect. Resellers not offering those solutions as part of a voice platform are actually ruled off the shortlist pretty quickly.

It doesn’t stop there. UC today has gone beyond the desktop. It’s now gone to mobile devices, and our customers are demanding that they want that same UC functionality available to them wherever they may be. There’s a huge opportunity there.

Half the CIOs I talk to say within five years they believe 50 percent of their workforce will be totally mobile, and that presents an enormous opportunity for the reseller community. There are two distinct types of partners out in the market today and there is a convergence between the telephony channel and the IT channel.

The opportunity with mobility is for them to become a true solution provider and offer the technologies surrounding that telephony platform. If they’re going to step into the BYOD world and offer mobile applications enabling staff out of the office, then they need to become proficient in wireless LAN technology as well as a security. Also MDM (mobile device management technology).

CRN Ryan, how important is it for resellers of mobility solutions to be resellers of mobile communication services as well? Are the margins shrinking so much around the devices and  other areas that that really needs to happen?

Ryan Well it certainly goes hand in hand. When you look at the tablet devices and smartphones,  particularly the tablet devices, going into next year, they’re going to have LTE and 4G in there as standard. As a small business owner, the challenge you have is really about aggregating the telco costs of those BYOD devices and how you can get best value, because for me, I wouldn’t want to be handling a whole heap of expense claims from separate telcos and then try to develop a consistent service across devices. Certainly for SMBs, the challenge is really going to be the best way to implement mobile device management across disparate devices.

CRN Do we think there’s prohibitive billing issues with regard to resellers actually becoming resellers of telco services to accompany the mobility solutions they’re delivering?

Ryan Fundamentally it’s a great business opportunity for resellers. It’s something that when we talk to our partners about moving into the managed services space and building that recurrent revenue model, part of that is being able to do the telco services as well.

CRN Jason Brouwers, the trend towards mobility and BYOD is placing a lot of pressure on customers’ existing networks clearly. What do you see as the opportunity for partners to help them manage and capitalise on this disruptive trend in terms of upgrading and selling new network infrastructure.

Jason The really beautiful thing about technology, and particularly the consumerisation of IT, is that it creates opportunity. It creates problems for our customers who turn to the channel for help. There are always things that come to challenge us, from a technology point of view, but that’s really quite a good thing.

So BYOD’s here. It’s going to be something else tomorrow, but the key thing is that from a partner point of view, from our point of view, what’s important is that it can create a real opportunity. But probably most important is the services pull-through. So it’s not just about the products, but about what they can do and the value you can add for your customers because if it’s complex then that means they need the channel to solve those problems.

CRN We all seem to accept that the horse has bolted and there’s nothing we can do about it. It’s irreversible. Did something change in terms of IT managers and their behaviour? 

Jason The key thing is that IT managers out there are very much like me – they have 13-year-old sons and 11-year-old daughters who have high expectations of how they’re connected at home, and they understand technology, and those IT managers use their technology at home. And the executives are asking for these things themselves.

They realise the benefits of it, and they realise if they don’t get on that train that they’ll miss out and they’ll be irrelevant. So it’s not something they can hold back on, that’s not a threat to them personally, it’s just that it is what it is. It’s actually an opportunity for them as well. If they don’t take that opportunity and get in front of a conversation about BYOD then they’ll be less relevant in the IT world as well.

Neville I think there’s actually a sociological change that’s driven most of this to be honest, in the way that people want to work. The devices have enabled a lot of that, there’s no doubt. But in terms of IT managers’ ability to stop this particular phenomenon or not, I don’t think it’s within their power. I would challenge all the people in this room as well. I’m sure you drop in and out of your personal and work life on almost a five- or 10-minute basis. You’ll be looking at your emails, watching your kid play soccer then go back to doing a little bit of work. Or go home, read a story, and at 8 o’clock be back on line again. It’s just in, out, in, out, in, out.

It’s a fundamental sociological change that’s gone on in our society, and so BYOD I think is just a symptom of that, but it also represents an opportunity. You can try and resist it, but I don’t think it is resistible, and for the reseller community out there, I think we probably do get hung up a little bit on ‘the’ problem, which might be the security aspect of it, or the loss of control, or the HR policies that have got to go with it and all those sort of things.

I think probably a better way of tackling it is actually embracing it as a positive, because the security thing can get fixed.

There are people here that can fix that right now, and in fact it is doable right now, but to have a conversation with the customers about ‘if your staff are bringing all this, and if this is the way they want to work, and this is what they’re bringing in to their environment, what opportunities does that then represent for your business, Mr and Mrs Customer?’ And take them on that journey. I think that opens up a whole world of opportunity, which turns into revenue ultimately if you do it right.

Nick The IT manager isn’t there to deliver technology – hasn’t been for a long time. They are there to deliver productivity initiatives and the means to productivity and particularly in the mid-market where we’re all concerned about today. The CEO only cares about that, and once we start talking about BYOD or cloud or consumerisation of IT, big data, whatever you want to call it, we start to talk about technology. The CEO doesn’t care about that and they’re charging their IT managers whoever they may be to deliver productivity and that’s it. 

Jason Time equals money and for a lot of our customers out there time is a competitive advantage. If they can get there quickly, if they can be the first based on some information that they can gather. If they can get people on the ground early, using a device which connects them to everything they would have in the office, that can give them a competitive advantage as well, that’s important.

CRN Jeff Morris, you said you were pleased about the ‘bring your own Dell’ trend you’ve identified; is not the BYOD trend a major threat for a company like Dell? You have a massive R&D market investment in desktops and laptops, but surely the move to smarter and smaller devices connected over high-speed mobile networks – isn’t that really a threat for your company?

Jeff Morris Not really. When you look at it, 50 percent of our revenue comes from the enterprise space. Companies need plumbing for whatever they do to access information. You know, we’ve got site wall so if you want to come in through a VPN, because you want to make sure the conversation you’re having if you’re a remote worker is secure – you want to have a firewall there where you can filter the content or prioritise traffic so people aren’t spending all day on YouTube.

You want to have enterprise access control, control of people coming in – we can do that too. For some people who do not want to transform their business around BYOD, there is an opportunity with Windows 8 where hey you’re pretty familiar with this plumbing.

A Windows 8 environment is a pretty good one to go with right now. And guess what? You know how to do that, and you know how to do that well. And if you like my devices, I’m happy to sell you one of those too.So for us we still think there’s plenty of opportunity, especially in high price brands.

Ultrabooks, because of the consumerisation of IT, are an opportunity for people, because they want to use these smart and sexy notebooks in the enterprise space. If you need some infrastructure for the plumbing to enable BYOD, happy to help you with that too. We think that’s a great opportunity for our partners.

CRN Has that demanded a radical retraining and reskilling of your partners? How have you undertaken that?

Jeff Morris Absolutely. The channel is not new to us, we’ve had channel for some time. We now have more partners who are channel based, like Sonic Wall, Quest, Case, so we want to make sure they’re aware of the opportunity beyond just a point solution and where does this fit into the BYOD story. That’s the important thing, to tell a story. You’ve got to have the conversation and give an idea of what potentially your solutions from your vendor can do to help you embrace BYOD. That’s where we’re helping, and helping our partners and customers to tell that story to them.

CRN Do you feel there’s a fair bit of confusion among Australian businesses on how to actually harness mobility and generate real opportunity from it? All these devices are flooding in, and we know they’ve got to connect them to the network. But what sort of opportunities do you see for resellers to be trusted advisers around mobility, or is it just so simple it’s become so commoditised that people bring their iPhones, they plug into the network, and nothing else needs to happen?

Jamie I don’t think that’s necessarily the case. The job of the reseller is to show customers how to leverage the applications that sit on those devices right, and there are so many applications available with so many functions, that customers are confused.

They’re all talking about BYOD and what that means for their business, but not many clearly understand how to fully leverage what’s available. As I mentioned, there are so many different avenues, for us at ShoreTel it’s about telephony and enabling the remote worker to be able to communicate via a device, whatever that device may be out in the field, just as if they were sitting at their desk.

That brings real productivity benefits and cost savings to the customers. But customers don’t really understand. There’s so much talk around BYOD and so much opportunity that customers are confused. The job of the reseller is to understand the business need and then help the customer address it.

Jeff Hwong Everyone is going on the internet, assessing their Facebook or Twitter, but what’s been forgotten is the proper, business-like applications that mobility can support. Take education, e-health. These are some of the applications that actually enhance and improve productivity and benefit society as a whole. It is a social phenomenon, but the question is how do we tap in to this?

If you look at the whole and think about how you can help businesses deliver value and how do we deliver value to businesses, this is the perspective most businessmen have. Rather than ‘oh, you know someone’s assessing the network 24/7, they’re not working at all’, but in terms of e-health for example, take the ability of doctors to diagnose sickness or illness across remote regions. These are applications we think bring a lot of benefits to society, rather than talking about consumer behaviours.

Ashley There are lots of opportunities for resellers to answer even basic questions in a way that their customers will think is inspired, in the same way it has been doing for the past 20 years. Say a staff member puts data up on Dropbox and shares it with someone else. Who’s going to take responsibility for deleting it after it’s used?

There’s some very basic questions in answering that. Have you got a password on your phone? What happens if you lose it? Who else is going to be impacted? What happens when you need access to your phone right away and you can’t get on a network? There’s some very basic questions that you can ask that will lead to other opportunities. I think we probably don’t value the disciplines we’ve had in IT and that we can bring to this discussion.

Jason Those cases are critically important, because people get it, they know how BYOD works, they can bring their smartphone into an office, but what does it actually mean for their business if they get on their iPad and they’re in a café? What does that actually mean for their posture or their identity and what does that mean for the business? It’s not just how they do it, but what it means. That’s what businesses are grappling with.

Neville If I could pick up and extend from Jason – it also takes the role of the consultant in the channel partner to another level as well. Traditionally we talk about whether our widget is faster than someone else’s’ widget and does it fix a problem. There’s also a middle bit which is now required with BYOD in particular in that it takes you into the realm of customers’ HR policies – how technology affects how people work within an organisation.

It’s not the sexy bit but it’s the bit that resonates the most with the customers because it’s the bit that will cause you the most grief within organisations when they go to deploy it. So my thoughts would be as a channel partner in the community, if you really want to resonate with the customers, have a sense of what best practice might be around some of those aspects. It’s something we’re probably not used to talking about, so there is a challenge there.

CRN David Lenz from Ingram Micro, what do you see as the key opportunities around mobility from a distributor’s perspective?

David Internally we’ve moved away from a carrier-based contract which was the traditional way of doing mobility. Each employee has their own plan which we actually pay for and they bring their own device. The initial part of that process was done as a way of providing access to the service, and then the company itself had to redefine how it would actually provide that process and procedure. That comes around HR requirements.

You go through a whole different process to bring people on board. Now that’s expanded from both laptops into tablets into smart phone technologies as well. It has changed. Most of the conversations here have centred around what people are using this technology for today, but it isn’t about what we sitting at the table think. Most of us are in an age bracket that the younger generation are defining for us. 

They are the ones who will determine how technology is used. Increasingly the conversation will be: ‘I didn’t realise you were using that for that’ and that’s going to be a common thread we’re going to see right through the industry and we really have no choice but to accept it and adjust to it.

Audience question- Sydney Borg, PCS Australia I have previously before this session listened to the whole story about cloud. It sounded like a bad weather forecast to me. It’s worrying the hell out of me now that I can’t sell a rack full of blade servers and stands and I’ve lost the revenue there, and now listening to the whole BYOD scenario, I’m concerned even more. I may have to go outside and start pumping gas. I think we’ve missed the whole boat on this BYOD trend. I’m not a fan of it at all. 

I have to be honest with you, as a systems integrator, I still believe in the old fundamentals that if I don’t control the hardware then I don’t control the client. Too many times in the last few months with BYOD policies within clients, we’ve lost control in that you’re right, they bring in Apple.

You find you’re under pressure that once they’ve started using an iPhone, they want to start using an iPad and if they bring an iPad in, that means I’ve lost the laptop or the tablet sale. So there is a growing wave there of momentum working against us in that if we lose the mobile phone (which we’ve probably already lost because it’s an iPhone), we lose now the tablet device, because they’ve standardised on it. I’m told it’s all fine and I can sell them a Netgear wireless router, I can put a Vimeo Video Switch, sell them a little bit of security software.

So where does the reseller make money now?  We’ve spent a lifetime, and I’ve been in this industry for 35 years, working with the manufacturers to develop a relationship so we can go in and sell a standard hardware platform, a standard operating environment. To be able to support that, to be able to go back and retain that client, every three years, to replace the hardware, keep asset registers the whole plethora of it, you’re saying we just throw all that down the toilet now, and allow them to bring in their own device?  Where do we make money?

Jeff Morris Not everyone wants to do it, by the way. Our customers who don’t want to do it, they want to have a level of control. Let’s play it out. If your end user goes down the shop and buys whatever laptop he wants to buy and it breaks, they’re probably going to go back to him to fix it and avoid downtime.

Some customers – actually Microsoft does this today – advocate ‘choose your own device’. Staff are told they can have any one of a number of devices and it will be supported. So we are working with a number of customers on that, where they want to give choice.

But the choice they give you, IT still has what they want to manage it, and it’s got tools and systems where they can deploy and manage it, and it’s got a level of service and support that they want. So if the thing breaks they’re not going to have to ship it back in a box and wait two weeks to have it replaced or drive in the car, wait in a bar for some guy to fix it for him, if he’ll fix it for him there.

There are still opportunities for your customers where if  they won’t want to do it, we’ll give them options. The options would be ‘you can have any one of these devices, and we’ll fully support it from a help desk point of view’. If you go outside of that, then we can help you with an SLA. So if you want to be supported anytime, anywhere, choose one of these devices. We’ve got a number of devices where we’re working with people on that.It’s about having the conversation.

Make sure they understand ‘if you bring that in, I can’t help you with it, because I don’t necessarily have the skills to help you with that and I don’t have a replacement for you’. Have the conversation and don’t give in to it. With those devices you talked about, if they’re connected to Microsoft infrastructure there’s an opportunity for you to sell some SLAs and there’s some opportunities for you to sell some VDAs. The Microsoft house always wins.

Neville I guess if you look at it through the narrow prism of the device, there might be a perceived threat there, but if you think a bit more broadly about what they’re actually going to use the devices for – if they’re going to use it to access data and the explosion that’s going on in data and its storage and things like that, gives you an opportunity I’d say to reap revenue.

In terms of the traffic that’s going to be carried, and I know my colleague here on the left of me from Cisco is going to agree wholeheartedly with this around video and the switching and routing that’s going to be required to do that, and do it in a really high availability, high quality outcome is going to be enormous.

I’m not sure that it is all necessarily going on the cloud to be brutally honest, and the cloud always has to come to somewhere, and Jason you might have a view on this as well – but I do think there’s still an enormous opportunity around those different sorts of spaces. And the last thing I’d say which might be a little bit provocative, is that unfortunately I don’t think you can stop it. So if you ignore it, then I think you’ll be caught on the wrong side of history.

Jason I think it’s just a different opportunity. We are going to use some opportunity in some areas, but there’ll be opportunities that pop up, because it is complex, because there’s any device, and it’s just not going to be all Microsoft like it used to be. People are bringing their Apple devices, they’re bringing a multitude of devices.

From a Cisco point of view, our mantra is ‘any device, anywhere, any time’ – and central to that is our identity services engine, which actually solves that part of the problem – so we’re trying to take a network-centric view to something that is a very complex problem, and the value of the channel is that they can take that and solve those complex environments that are now not what they used to be. They’re not just a PC on a desk delivering applications, it wasn’t just someone talking on a phone.

Sydney Yes, but once you’ve fixed it you’ve still lost the hardware business. I mean you fix it, it’s done, but at the end of the day, now everyone bringing in their Apple device, I have lost that hardware revenue. Now I know a comment was made about ‘hey, don’t worry about the vendor, because you’re only making 3 percent right on the hardware, well guess what, we’re not making much more on any piece of your hardware, doesn’t matter what we sell, software or hardware, the margins are getting skinnier and skinnier'.

Nick Once you’ve lost that you’ve lost it, it’s gone, and you can’t underestimate what it means to you, when you’ve got a revenue contract and you’re rolling out that hardware and you’ve got control of it, you lose that. Well where does it come from? Services? I mean once you fix the problem and most of our clients, whether it’s SME, small corporate or big corporate for that matter, a lot of them have their own IT departments nowadays.

Syd, you’ve got a successful business and over 35 years you’ve had a successful business, because you know what you’re doing and the main reason for that is that you’re actually doing something that technology doesn’t do. I would just – what I think about it is forget about getting lost in the notions and terms of technology, vendors have to commoditise things real quick, because their shareholders say so. And whether it’s something that’s been around forever, or whether it’s an advancement and emerging technology, they have to do that, because their shareholders say so.

So it becomes commoditised at a sell level, it’s a commodity sell – but what you’re involved in is not that. What you’re involved in is highly considered decisions that your customers have to make based on solving business problems, and the beautiful thing about your business and every reseller’s business is that what you do can’t be commoditised, it just can’t.

Regardless of whether you’re selling technology called the delivering of BYOD or delivering of cloud, it can’t be commoditised, because you’re customising technology to solving their business problems. You’re in the sweetest spot ever, because the confusion that’s coming from, especially the analysts trying to call things different things, is creating so much confusion for your customer, that you’ve never been in a better situation, and don’t buy into markets being flat, they’re not.

Jamie I think the business world isn’t changing. It’s changed. The word ‘embrace’ has been tossed around a lot and I think that is the biggest opportunity for resellers – you need to embrace what’s happening.

I read a survey only a couple of weeks ago of a study done of 20 to 30 year old somethings out in the market – the question was around ‘how do you choose where you’re going to work?’ and over 70 percent said they’d choose where they’re going to work based on the working conditions that that employer offers – the type of devices they get to use etc etc. So that’s a huge change right, and the up and comers are going to really dictate who’s employing them, and I think we need to embrace that and embrace it now.

Audience question The other aspect, we were talking then about selling the nodes, and the implication of potentially a reduction there based on BYOD, but really for resellers it’s all about annuity income – it’s great to do some ad hoc consulting, there are opportunities to talk to customers and solve problems, and that is consulting, and that’s excellent, but there’s an interesting dynamic here in terms of BYOD in the sense that in the managed services space there’s a lot of technology movement around mobile device management technology.

They’re all building it and through people like Kaseya and all these sorts of things – but when you talk about BYOD I think they’re sort of contradicting each other, in the sense that why would business owners at an SMB level which make up most businesses, pay a monthly reoccurring fee for their staff’s kit?  

Now most businesses aren’t going to pay half or give you an option. We’re dealing with the masses of SMB sites, you know 20 to 100 that make up most businesses – they really struggle with that concept of even managing mobile devices, because in their perception they don’t break. Apple did a great job of that.  

So you’re actually struggling to (1) charge an annuity income for it, but (2) if you bring in BYOD, you almost can’t charge annuity income for it, because it just goes against corporate logic, in the sense of paying a monthly fee to manage other peoples’ devices – so really that’s just a statement. What do you guys think?

Jeff Morris Well I’d argue why would you want to manage someone else’s device first and foremost.  I think the industry’s shifting anyway from managing someone’s device, why would you want to manage it. Do you really want me managing devices and seeing what you’re doing to how about I make sure that I deliver the content that you need to access for work – I deliver that to you, but I make sure that I’m not exposing the business to intellectual property loss or privacy breach – so I’d rather be able to secure the information and deliver it to you than really care about what you’re doing outside after work, and what apps you’ve got on your device.

I think that’s what you’re saying that if you look at what Citrix is doing, they’ve got app wrapping, containerisation, VMware’s doing it – and the industry’s moving away from ‘how do we deliver the content to you securely’ – rather than ‘that’s your device, I really don’t care about it and if you lose it I really don’t care, I just want to make sure that from a business point of view, I’m not exposed to a breach of IP or a loss of intellectual property’.

Jeff Hwong I think there’s going to be another trend coming outside of BYOD. In various countries where the corporate concern about security is more tying, there is a new trend that’s going on right now, it’s called COPE meaning Corporate Owned and Personally Enabled. So you can forget about your BYOD.

I think there’s a trend coming in right now where corporations are now doing full scale negotiation with device vendors such as us to provide devices that both the employees can access at home, and also use the same device during the work time. II think that’s a new trend that’s going to come.

Whether it’s going to be successful or not, I’m not sure, but in other countries we are seeing this kind of policy being implemented – maybe not for Australia, because you guys like to have your own toys – but in other countries it’s happening right now.

Audience question for David Lenz, Ingram Micro: Is there an opportunity for disties like Ingram Micro to help partners develop strategies to make an annuity model around annuity model around mobility more convincing for their customers?

David I think when you talk about the opportunity for resellers, there’s always going to be disintermediation take place in every market, and it happens, it’s been going through life cycles all the time. The issue people need to look at is that people are going about SMB and low index, SMB market and things like that, but if you look at people who are actually buying product at the moment, it’s in the SMB space, they’re still buying. They’re buying a lot of it.

So their concept of everyone’s talked about cloud, we’re not seeing all of these people move to cloud. So it’s not like an absolute avalanche of people going down that path. If you look at the transacting partners that we see in the marketplace, they’re still selling core technology, still selling servers, desktops etc into that space.

We do a lot of work in the cloud business at the moment, but I can tell you now that at the moment, we probably have about 60-odd partners signed up and probably only about 13 of them transacting. That’s right in that pure SMB space.

So I think people need to get a little bit of context about that, it’s not going to disappear in the next couple of years. From the point of view of market opportunity it’s still there.

So if you then look at what the opportunity is for organisations who want to go down a mobility plane, there’s a lot of vendors out there who are starting to build capability for a reseller to actually have that conversation with their customer around what they should do, how they should go about it, and then that drives both the sale of hardware, plus the management and the building of some annuity associated with it.

So the vendors themselves are looking at it from the point of view, whether it’s Microsoft, Apple or anybody – they are going down that path of looking at how you start to build a business around that. What apps do you deploy, what do you actually move across, how are you actually going to manage that part of it – there’s a lot of advice that needs to be brought into play there, and the bigger companies who make the decisions to move to BYOD.

A lot of us are in that space today, and that’s great, we’ve made that decision, there’s a little bit more management infrastructure associated with it, a little bit more process already built in, but down in that mid to low end SMB market, I’m not seeing that as being the massive shift that’s going to happen at that particular time. They’re still rolling out new networks, upgrading servers, doing all those types of things. 

So I think there’s a good business model there for everybody for the time being, and I think where BYOD fits with companies, they are going down the path of moving it, but some of the core systems, core infrastructures all those things are still being run, and there’s good money to be made in that space, and especially the comment around data management.  

Data management is going to be THE biggest thing in the next three or four years. How do you manage the content, how do you manage the accessibility of the information you’re providing, and then more importantly, rather than using Facebook, how are you going to use social media into that environment and then strategies around that – so there’s a long way for us to go yet, and I’m certainly not sitting there saying I have to change my entire strategy as a distributor overnight. I think there’s still opportunity for all of us to build our business, and we do have to grow with the business and refine our strategies, but that’s kind of the approach we’re certainly looking at at the moment.

Jeff Morris I certainly agree. To do BYOD depending on what you want to do, as we talked about, you need to have that conversation. It is a massive transformation. It’s also potentially a big investment and can cost you more money in terms of putting that infrastructure in.  

Forester just brought out some research today – the Microsoft Windows 8 came out in a survey as the most valued platform that people would consider for their next tablet purchase in the enterprise space.

And there’s a reason for that. Everybody’s familiar with it, they’ve got the tools, they’ve got the training in place, you’ve got a gamut of legacy applications you can use with it, and so if you don’t want to go and put all this stuff in place we talked about MDM, MAM, virtualise, whatever it may be, take a look at a Windows platform, there’s a load of them out there today – what do you want to go, hybrids, or you have the convertible or you have a slate, that’s an opportunity for you, but you can go in and give them both sides of the coin, that you can go transform your infrastructure completely.

And I can help you with that with networking and so on, whatever it may be – or you can take a device now that truly has been optimised for a touch experience, but has familiarities, it’s like your old friend again, and you know how to integrate it.

So the idea again of going in and having that conversation and educating and showing both sides of that coin, I think there’s still an opportunity in the PC space, no question. The opportunity you have is to have that conversation from both sides of the fence.

Ashley I don’t know about anybody else here, but I haven’t got any fewer devices. I’ve still got my tablet, my desktop at work, I’ve got two phones – and I’m not getting any fewer of this sort of stuff. I think cloud is an additional conversation you have, and I think mobility is an additional conversation, and I think MDM you know bring your own device is an additional conversation to mobility – this is all extra stuff. I haven’t seen any shrinking back of any of this stuff. It’s just all new, and you just find the application and the business purpose.

So to our friend out there, I think you’ve got more work than you can handle frankly. Just making sense of it all for your customer is I think the real skill.

Nick I think the key think with all these new strategies, they’re not technologies, you can’t buy a cloud skew and mobility skew – it’s an ‘as well as’, it’s not an ‘instead of’. There’s more to add, there’s additional devices to manage, not new devices that displace others. More load on the network, more bandwidth required, more security, more data to manage, more data to analyse, more more more, because it’s what the device brings.

You know, it’s fundamentally a major major opportunity for everyone – and that’s why I said ‘don’t believe the flats’, there is no flats in the market – there’s only flats for stuff that shouldn’t be there any more, but that isn’t replaced by something that someone else is going to do. It’s replaced by more contemporary device or system or application or something in the data centre, that you’re all managing for your customers and solving those problems, it’s more, these things are more.

Jamie In the telephony world there’s been a lot of debate around the desktop phone – the debate’s been around ‘will that device disappear?’ The answer is probably over time, slowly yes – but will it be replaced with a device that allows you to come in and slot your mobile phone or more so your tablet into, that then becomes your phone, your video phone, that you can unplug and walk away with as you walk around the office or go in between meetings – so to echo everybody’s comments, I don’t think the device is going to disappear.

Jeff Morris One size doesn’t fit all, and every customer you have the conversation with will be different, it’s bespoke every time, it’s not off the rack, and it’s an opportunity for you. What is networking.

We’ve got schools that now have no education funding, and the kids want to bring in their devices and looking to use VDI, so we think VDI in a box is very low cost way for them to deliver a desktop on whatever device they want to bring in – but then the challenge there as well is because they’re so many wireless devices, is the wireless infrastructure they have in place able to cope with all those users – is the back on from a network point of view capable of handling that.

There’s opportunity there. It’s have the conversation, really sit down and understand where you want to go and see how you can go on that journey with them.

Neville Maybe if I can say one quick thing – nothing anybody’s said for the last five or six minutes on this particular topic, has anyone mentioned the fact the actual customer has got smarter or more capable of managing this on their own? They need your help more than ever.

So all these other components, they all come back to one thing, complexity and change, and I haven’t seen anything in the marketplace that tells me the customer has got better at managing it by themselves – so I think there’s a huge opportunity there.

Audience question I hear you say BYOD is here. It is, it’s here. We are all in this room because we’re in IT and it’s constantly changing. We’re in the room because we make money. We’ve been successful. I’d be interested to hear what’s the next thing from BYOD in your opinion. Is it BYOD applications? What is the next thing that’s going to come on? What’s the next thing we should be looking at and getting ready for now?

Nick The next thing, the next incarnation of remote access started off as remote access and it was called all these things – just keep doing what you’re doing, and let the industry give you a new name for it, so you can go out and sell …  And do it as well as you have been.

Jason I think you half answered your own question, in that the application might be, businesses are now looking at what applications they can put on those BYOD devices or any device that could change the way they do business, and in Cisco we have that as well – so it doesn’t matter where I am in the world, I can log on and do approvals on my smartphone, or whatever it may be, my iPad or from my laptop in my hotel. That’s the thing we’re looking at now, it’s the applications that now go on in this new world, that we can make a difference with. So that’s another stream of activity as well.

Jeff Morris I think there’s an opportunity for, we are already down that path, is well how do you scale it now, how do you automate it that the user can self-serve themselves, so they’re not putting pressure on IT. I think we’ll get there, where a user can basically provision their own devices, provision their own applications, and IT can sit back and focus on now innovating, you know how can they drive the business, rather than keep it up and running.

So I think what we’ll see is we’ll try and simplify where we can where the users are able to self-serve themselves, so I think that’s an opportunity in the software space and around the management side of it, where no matter what the device is, how can a user just go to a portal, no matter what the device is, provision that device and then grant themselves access to applications on that device, and if you can scale that, then IT can then focus on adding value to the business and moving the business forward rather than just keeping the lights on.