Channel players say they are taking leading roles to evangelise the developing WAN optimisation/acceleration space and educating customers on its benefits.
"A lot of people don’t know about it until we tell them about it. The sales cycle is long because we have to qualify the product, show them what kind of increase they can expect and show them on one of their links," says Jay McKeever, principal at Stormwood, a US-based solution provider that works with optimisation products from Swan Labs, acquired earlier this month by F5. "But once they go through the evaluation, they won’t let us take it out."
Stormwood expects to hit about US$200,000 in Swan sales in its first year with the product line, he says.
Driving market growth is the rising importance of applications, not only web-based ERP and CRM applications but the booming VoIP and video-over-IP markets as well.
As these applications reach mission-critical status, customers are starting to hit bottlenecks as they try to push that traffic out over the WAN.
"What’s driving this is the fact that companies are looking to deploy applications in a ubiquitous manner so they are accessible to anybody, regardless of which facility they’re at or if they’re off-site," says Andrew Segal, president of Vandis, a Juniper partner in the US with a seven-figure optimisation business built on Peribit and Redline technology. "When you say you want your applications to be available to everybody, you run into delivery issues," Segal says.
Those issues manifest themselves as slow application performance and network congestion problems some customers mistakenly try to address by adding more bandwidth, solution providers say.
But it is a tack that rarely rectifies the application performance problem, says Stormwood’s McKeever. "Customers are starting to realise that a bigger pipe doesn’t necessarily mean faster," he says.
For example, one large pharmaceutical company with international offices bought a full DS3 circuit for US$18,000 per month to solve its application performance issues. More bandwidth, however, did not cut down on latency caused by the incessant ‘handshaking’ utilised by TCP to transmit data between sites. "When it didn’t help, he came calling," McKeever says. Swan’s technology eliminated much of that latency, giving Stormwood a means of solving its new customer’s problem.
Reseller Frontline has been selling Packeteer PacketShaper and related products for close to 12 months.
Greg Wade, marketing development manager at local reseller Frontline, says that the WAN acceleration and control products are a good sale and the reseller is finding it can get in the customer’s door pretty easily and a quick ROI is extra attractive to potential buyers.
"If we are given the opportunity by the customer to demonstrate [the product] they find the statistics are pretty compelling and we’ve had a good success rate," he says. "It’s lucrative in terms of revenue and profit and is a growing segment of our business," he adds. He says there is not a great deal of professional services support business to be had from these products due to the available software tools that give customers good diagnosis of what is on their network.
Frontline has deployed Packeteer in its own offi ce. He recalled the one particular Frontline employee was downloading a great deal of information from the web in relation to cars, which the reseller was able to identify.
"The level of information is quite valuable. It gave us a clear understanding of the potential of this product to understand what’s going on in our network and the ROI was in four months," he says.
Bede Hackney, country manager, Australia and New Zealand at Packeteer, says the perfect candidates for WAN optimisation are any organisations that have branch networks and are spending money on bandwidth.
The company has around 1000 customers in Australia and is "nowhere near market saturation", according to Hackney. "These days, customers are starting to realise that upgrading bandwidth is not the answer. They’ve gone through that cycle enough to know now. ROIs in the range of five to six months are a common occurrence," he says.
Big resellers and integrators like Dimension Data, Equant and CSC — its top reseller partners — recognised early the potential value of the market, Hackney says. "The margins are attractive and there’s good revenue opportunities in government, fi nancial services and primary industry," he says.
Diving into the data centre
Customers are also looking at data centre consolidation strategies. By moving their equipment out of the branches and into the data centre, they gain centralised management over their infrastructure, resulting in lower costs, tighter security and improved regulatory compliance. The trick is to consolidate without losing performance, and WAN optimisation is key to that, solution providers say.
"The value proposition is like nothing I’ve ever seen," says Hayes Drumwright, CEO of Trace3, about products from Riverbed Technology, which Trace3 has been selling for about eight months. Riverbed’s Steelhead appliances combine WAN optimisation, WAFS and application acceleration to speed data delivery to branch offi ces.
Trace3 has hired three staff members for its Riverbed business, which is on target to reach at least US$1.5 million this year and is likely to grow 100 percent year-over-year for the next few years, Drumwright says. "Customers no longer need [local] file servers and Exchange servers. It saves a tonne of money," Drumwright says, noting that customers can typically spend US$30,000 to US$150,000 per location for local servers.
WAN optimisation and acceleration technologies are helping solution providers push into the data centre, says Keith Zubchevich, vicepresident of business development at Riverbed in the US. "Some VARs have been playing in the SMB and branch offi ce itself. Now for the fi rst time they’re key players [in the data centre], not the big-iron guys," Zubchevich says.
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