IBM shakes up software distribution strategy

IBM has rejigged its software distribution strategy in an effort to create greater specialisation in its sales channel.

The vendor has slashed access to its software portfolio amongst its core partners Avnet Partner Solutions, Express Data and itX (formerly Alstom IT) while adding a new regional distribution tier.

Prior to the overhaul, itX, Avnet and Express Data had full access to the company’s software offering of DB2, WebSphere, Lotus, Rational and Tivoli.

ItX and Express Data will now offer the full range, with the exception of DB2, while Avnet will now offer only WebSphere, Rational and Tivoli.

Data specialist Meier Business Systems (MBS) — with offices in Melbourne Sydney, Kuala Lumpur and Singapore — has been appointed to carry IBM’s information management product, DB2.

Igatech — an Oracle and IBM house with offices in Darwin, Adelaide, Melbourne and Sydney — will also carry DB2 as well as WebSphere.

The changes follow IBM’s announcement in September of a planned channel review with the intention of creating specialisations — and thus higher margins — amongst its distribution partners.

The review process saw IBM partners requested to submit tenders and business plans arguing why they should be allowed to continue carrying the company’s software offering. Partners were also required to invest in skilling-up sales and technical staff.

Avnet managing director, Colin McKenna, said that while losing DB2 in particular was a blow, the overall impact of the new alignment was mixed.

“All sales will now be done through distribution so IBM gets a tick there for broadening the market,” he said.

“However, we now have five distributors instead of three, and many of those have the same specialisation, so there is a question mark as to whether any increased margin will pay for the significant burden of certifying sales and technical staff.”

Despite the changes Avnet would remain aggressive in its IBM business, McKenna said, and was in the process of seconding staff from Europe and the US to help steer its software business in the new environment.

For itX general manager, Greg Newham, the results were good news despite the distributor also losing access to DB2.

“It wasn’t an insignificant piece of business, but we got the lion’s share of what we wanted,” he said. “Next to Sun, IBM is our second most important business and its is even bigger for us now.”

DB2, a competitor to itX stable-mate, Oracle, accounted for some 10 percent of the company’s business, Newham said.

Express Data managing director, Ross Cochrane, said the company would continue to be active in the collaboration, messaging, security and web development spaces and applauded IBM’s firm stand on training and certification.

“The worst thing a vendor can do is appoint someone who doesn’t have the technical skills,” he said.

ED Software Group manager, Emma Scott, said the distributor was in the process of recruiting staff for their IBM business to build up its capabilities and was still negotiating with IBM around its software line-up, she said.

IBM Software channel manager, Sue Hope, declined to comment for this story.

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