Channel Marker

April 10, 2008  1:19 AM

The low-down from Honolulu: Cisco’s collaboration bent

Heather Clancy Heather Clancy Profile: Heather Clancy

I’d be remiss if I didn’t report in this week from the Cisco Partner Summit, where I’m helping the company’s Industry Solutions Partner Network team with some breakout panels and communications activities.

The themes I’m about to recount were plucked from the main keynote address hosted by Worldwide Channel Muckety-Muck Keith Goodwin and featuring Goodwin’s ultimate boss, Cisco CEO and Chairman John Chambers. For those of you who aren’t/weren’t here, some highlights:

1. Partner to Partner Collaboration: This topic gets a big-time boost with the introduction of something called the Cisco Partner Exchange. Basically, this is a social network where approximately 8,500 Cisco Certified Partners, managed services providers, distributors and application partners can search for other partners that might be able to extend their reach on a particular project. Cisco is backing up this introduction with a channel survey it conducted with Illuminas Research that found collaborative projects between Cisco partners accounted for approximately 31 percent of revenue within the partner ecosystem. Another very compelling case for collaboration: 78 percent of the resellers who responded to the survey (about 500 in call) reported that collaboration helped them increase deal/project sizes. Partner Exchange is meant to support collaboration in cyberspace by letting partners create skills profiles that include not only info about their Cisco specializations but about other technologies they might support.

2. Data Centers: Cisco is upping the ante with both a new set of Nexus switches (developed by Nuova Systems) as well as incentives for VARs investing in a data center practice.

The Nexus 5000 Series are meant for consolidation projects. It supports 10 Gigabit Ethernet PLUS Fibre Channel over Ethernet Data Center Ethernet and virtualization. The new switches are supposed to start shipping in May starting at $36,000 for a fixed configuration, 40-port 10 Gigabit Ethernet switch. Cisco also evolved its Value Incentive Program and will start rewarding VARs that invest in a data center practice starting in August.

3. Software: This one is a bit of a surprise, given how other vendors are supporting and selling their software as a service (Saas) offerings. That is, by selling them direct. But, Keith Goodwin says Cisco is creating a referral program for its WebEx offerings that will not only reward partners for the initial deal but for recurring activity on the service. You can expect this program to emerge in the next two to three quarters. What’s more, WebEx will continue to morph to allow for more and more different types of connections (and collaborative settings) that are independent of device. Hmmm. Is Cisco becoming a software company?

John Chambers was his usual prophetic, evangelistic self, focusing on developments that are drivin where he is asking Cisco to place its bets. The company now has 22 priorities, which range from very broad initiatives such as mobility to very specific ideas, such as “routers in space.” Talk about an emerging market! Collaboration and Community are the two big themes underlying most of Chambers’ thinking. Focus on markets in transition, Chambers advises partners, if you want to increase revenues. “If you focus on your competition, you are already behind,” he said.

I buy most of this, certainly, but the one thing that niggles at me as I write this is the big push that Cisco is putting on collaboration through tools such as social networks, video conferencing, instant chats and so forth. It’s not that I don’t believe this is the way to go, it’s just that I think many people are overwhelmed about how to handle many of these services – many of which currently reside in different silos. I believe in the power of the individuals, but collaboration in chaos could actually result in a decrease in productivity. My two cents.

More later this week from (poor me) Hawaii.

April 9, 2008  9:34 PM

Yahoo continues anti-Microsoft contortions

badarrow Barbara Darrow Profile: badarrow


Yahoo really, REALLY doesn’t want to be bought by Microsoft. At least not for the 42 million big ones currently on the table.

Yahoo is talking about combining its Internet operations with those of America Online (aka Time Warner’s AOL unit), according to a Wall Street Journal story posted Wednesday night.

Earlier Wednesday Yahoo announced a trial in which it will carry search ads from Google, its erstwhile archrival in web search.

The Journal says these moves are part a potential “three-fold plan” by Yahoo to nuke Microsoft’s proposed $42 billion buyout. Another part of the strategy is a Yahoo stock buy back.

All fo these machinations may end up pushing Microsoft’s bid higher, alhough in a letter to Yahoo’s board, Microsoft CEO Steve Ballmer said given market conditions, Microsoft could lower its offer if Yahoo continues to delay.

Oh, and he threatened a proxy fight.

It just keeps getting better.

Barbara Darrow can be reached at

April 8, 2008  4:20 PM

Google channel changes coming

Bcournoyer Brendan Cournoyer Profile: Bcournoyer

Google’s moving more and more into the enterprise, and with that shift, some changes in its channel program are coming.

I’ve been trying for a few weeks now to set up an interview with Google about its channel strategy. Today I spoke briefly with Andrew Kovacs, a communications manager at Google, and he told me, “We’re currently in the process of sort of re-examining our channel program.”

He then took the rest of our conversation off the record as he explained to me when Google will be able to talk about its channel program again. I can’t disclose that, but I can say it will be sooner rather than later.

Google’s Web site lists several dozen channel partners in the enterprise search market, about a dozen Google Apps partners and three Google Enterprise geospatial partners who do integration work with Google Earth. But as the Mountain View crew expands into the enterprise with Google Docs offline, the Google Apps Engine and a possible enterprise email appliance, it may need to rely more on channel partners to reach new customers.

Of course, company execs could also decide to rely on their strength in online services and go direct. Either method will have big consequences for the channel, so we’ll just have to wait to hear what Google has to say, when it’s ready to be said.

April 8, 2008  9:49 AM

Google App Engine: Amazon killer or ‘Geocities 2.0′?

Bcournoyer Brendan Cournoyer Profile: Bcournoyer

We’ve been awaiting big enterprise news from Google for a few weeks now, and last night we finally got some.

The Google App Engine is a free, hosted Web development platform that will let businesses and organizations build and run Web applications on Google infrastructure. It’s being mentioned in the, ahem, blogosphere (I hate using that word) as new competition for Amazon Web Services (AWS) and even But there’s some skepticism, too.

GigaOM’s Stacey Higginbotham notes that making the Google App Engine available for free “will come at a cost to Google in terms of its margins. … It also will have a ways to go before it can compete with the 330,000 developers Amazon says are using its Web Services as of January.”

One of her readers, “Chetan,” doesn’t think that will ever happen: “Amazon is an equally tough company when it comes to technology. They hold a dozen patents on AWS and they’ll punch in Google’s face if required.”

At first, the Google App Engine will utilize only the Python programming language. (That’s what Google uses internally.) Developers responding to TechCrunch’s coverage of the announcement say the Python-only restriction will hinder the platform’s growth. One reader, “Tom,” even comes up with this slogan for the Google App Engine: “Geocities 2.0, now with Python!” Ouch.

Our coverage of Google’s major, impending announcement focused on rumors of an on-premise email appliance that would compete with Microsoft Exchange. Guess we’ll just have to wait and see when and if that comes to fruition. For now, the Mountain View crew is still focusing on its bread and butter, the online services market.

But fear not, the Microsoft vs. Google angle is still alive and well. Author Nicholas Carr ends his blog post on the Google App Engine with two simple words: “Where’s Microsoft?

And Mary Jo Foley, who’s not into the whole brevity thing, devotes an entire post to answering that question. She points out that the Google App Engine may compete with Microsoft’s SQL Server Data Services — if Microsoft ever gets around to explaining exactly what that is. Microsoft is also working on BizTalk Services and has a beta version of its Synchronization Framework, which could also tie into their anti-Google strategy.

April 6, 2008  10:40 PM

Microsoft to Yahoo: No more Mr. Nice Guy

badarrow Barbara Darrow Profile: badarrow

Microsoft CEO Steve Ballmer has given Yahoo’s board three weeks to accept Microsoft’s $31 per share buyout offer. If Yahoo still does not move, he said Microsoft will put the offer in front of Yahoo shareholders and initiate a proxy fight. He also intimated that Microsoft might revise its $40 billion bid. Downward.

Money quote from Ballmer’s letter dated April 5:

“The substantial premium reflected in our initial proposal anticipated a friendly transaction with you. If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal.”

Barbara Darrow can be reached at

April 4, 2008  3:26 PM

VMware accuses Microsoft of spreading lies

Bcournoyer Brendan Cournoyer Profile: Bcournoyer

Say what you will about VMware, but they sure aren’t shy when it comes to publicly taking on the competition. Whether it’s an employee attacking Citrix on his personal blog or sales memos that try to drive a wedge between Microsoft and Citrix, the server virtualization market share leader doesn’t pull too many punches.

The latest example comes from Virtual Reality, the corporate blog VMware set up just to defend itself from bad publicity — or, as they call it, “set the record straight.” Its new post comes from VMware’s Mark Chuang, who criticizes Microsoft for distributing a Yankee Group report that doesn’t exactly paint VMware in the best light.

The reason the report is unflattering to VMware? Because much of it was innacurate, according to Chuang — so much so, he says, that Yankee Group agreed to publish a revision and removed the original from its website.

That hasn’t stopped the ever opportunistic Microsoft from spreading the report around, most recently in a virtualization newsletter this week, Chuang says. He also accuses Microsoft of continuing to distribute the report despite a request from Yankee Group to stop.

It will be interesting to see if Microsoft keeps drawing attention to the report and, if so, what action VMware takes to stop them.

April 2, 2008  6:57 PM

SAP shuffles

badarrow Barbara Darrow Profile: badarrow

SAP named Leo Apotheker co-CEO Wednesday. He will share CEO-ing duties with Henning Kagermann until the latter leaves the company next year.

Apotheker had been deputy CEO. Kagermann’s contract expires in 2009 and he said today he will leave at that time.

In the second half of 2008 “Leo and the new team will be the ones who will do the budget and start thinking beyond 2010,” Kagermann told reporters on a conference call Wednesday.

In a prepared statement, SAP co-founder and supervisory board chairman Hasso Plattner said Kagermann had requested Apotheker’s appointment.

SAP also named its very first COO by promoting Erwin Gunst to that post. Gunst had been president of the company’s Europe, Middle East and Africa (EMEA) region.

The moves were decided by SAP’s supervisory board, which also appointed Gunst, Bill McDermott and Jim Hagemann Snabe corporate officers effective July 1.

SAP is the ERP software leader, but faces big challenges as it tries to navigate from being an enterprise-only provider to wooing and winning smaller accounts. There it relies on its five-year old PartnerEdge program to penetrate accounts that would normally not hit its radar. In coming down market, SAP now must compete with erstwhile ally Microsoft for those smaller accounts

It also faces a lawsuit filed by Oracle over SAP’s TomorrowNow Unit’s business practices. Worse, a major customer, Waste Management Inc., has sued SAP calling the company’s $100 million software implementation in its shop a “complete failure.”

This is not the kind of press any company wants, especially in a tight economy.

Some interesting tidbits from today’s call: Apotheker said the company will continue its move into the mass market. “It’s our intention to move more and more into the volume business.” Hmmm. Volume. Isn’t that Microsoft’s mantra? Interesting…

Apotheker was asked whether SAP would step up its marketing rhetoric even as Oracle CEO Larry Ellison appears to be dialing down  his. The reporter referred to a recent call in which Ellison barely crowed about Oracle’s BEA Systems acquisition. Apotheker appeared to shrug it off: “As to Larry keeping quiet in a conference call, maybe he had a sore throat.”

Barbara Darrow can be reached at

April 2, 2008  9:23 AM

Channel Survey: Vendor leads are schlock, and some other unshocking findings

Heather Clancy Heather Clancy Profile: Heather Clancy

I couldn’t bring myself to write about this survey on April 1, because I figured you’d think I was pulling your leg. Although those who DO know me know that I am pretty much incapable of lying (my face gives me away) and am generally a very unfunny person (at least intentionally).

But, here we are on April 2, and it’s safe now, so here goes.

I was briefed late last week on some research that was conducted by the Chief Marketing Officer (CMO) Council and sponsored by Blueroads (the company that does one of the partner relationship management portals). The data, which the CMO Council is calling a scorecard, includes responses from pretty much anyone you would consider a reseller or a dealer. It doesn’t just represent the high-tech channel that has been my obsession for the past 18 years, it also covers businesses that represent consumer electronics or audio-visual equipment.

So, ready? Here are some of the high-level findings:

  • Fewer than 7 percent of the 500 respondents said vendors are their most valuable source of sales leads
  • And, only 19 percent of these folks said those leaders were “highly actionable”
  • Approximately 70 percent said vendor marketing campaigns were either “ineffective” or “only somewhat effective” in driving their business
  • About half engaged in any kind of cooperative selling

(You can download the full report if you choose to register here.)

“We’ve got this significant issue of lack of trust, lack of valued process between vendors and their channel,” said Dave Murray, executive manager of the CMO Council.

Do you sense a trend here? And, are you really surprised by the results? Honestly, I wasn’t shocked, and neither was Craig Downing, director of product marketing and demand generation for Blueroads. “The punchline here is that overwhelmingly, the partners say that customer referrals are their most valued source of business opportunities,” Downing said.

After all, what most vendors forget over and over again, is that most solutions-focused VARs MUST work with a slate of high-tech suppliers in order to serve their customers best. Even resellers that could be considered “exclusive” need to find great applications and infrastructure products to complement their main offering — whether they are offered in partnership with another reseller or ISV or whether they are part of the first VAR’s product suite.

Do I think vendor marketing teams could do a better job? Sure, but I think the best tools that any channel marketing team could provide are the research and solutions arguments to help their channel partners talk to prospective customers in terms they’re more likely to understand. The days of brochureware are fast fading. What this survey does point up in vivid terms, however, is the vital role that marketing plays in channel relations. So, ask yourself, do your key high-tech suppliers worrying about flashing corporate branding campaigns and the next Super Bowl commercial? Or are they focused on extending your own marketing resources, with the focus on customer-facing conversations?

Heather Clancy is a high-tech business journalist and channel communications strategist with SWOT Management Group. You can reach her at

April 1, 2008  12:06 PM

Google Docs now available offline (kind of)

Bcournoyer Brendan Cournoyer Profile: Bcournoyer

The Microsoft vs. Google battle has officially expanded to the desktop. Google Docs — albeit an extremely limited version — is now available offline.

With the Google Gears browser extension, users can now edit and save their documents locally when they don’t have an Internet connection. Then when they reconnect, their local information automatically syncs with Google’s online servers.

Google Docs software engineer Philip Tucker wrote about the news yesterday and posted a video demo by Google Docs product manager Ken Norton.

Google’s offline move comes as Microsoft continues to make more of its software available as online services. The big question about Microsoft is if the company truly understands the online market, but the same must be asked about Google and the traditional, on-premise software market.

For example, only Google Docs’ word processing documents will be available offline — not its spreadsheets or presentations. Tucker also admits that users will “sacrifice some features” when using the offline version. And these limitations will likely keep Google Docs offline from being a serious Microsoft Office competitor for the time being.

April 1, 2008  10:53 AM

HP charging extra to integrate VMware hypervisor

Bcournoyer Brendan Cournoyer Profile: Bcournoyer

Hewlett-Packard yesterday began shipping VMware’s ESX 3i hypervisor embedded in its ProLiant servers.

After news broke last month that Dell may give away the ESX 3i for free with its servers, VMware resellers began to fear that other VMware OEM partners would follow suit — essentially killing their business in ESX 3i sales. But that isn’t happening in HP’s case, as reports that the company will charge $495 extra for servers with the ESX 3i.

All of VMware’s OEM partners should begin shipping servers with the ESX 3i sometime this month, and it will be interesting to see if the others follow Dell’s strategy or HP’s. Microsoft’s Hyper-V also hits the market later this year, and that release should have a major effect on VMware’s ESX 3i pricing as well. Microsoft plans to charge just $28 extra for Windows Server 2008 editions that feature Hyper-V.

Forgot Password

No problem! Submit your e-mail address below. We'll send you an e-mail containing your password.

Your password has been sent to: