Techaisle Blog

Today Huawei announced an Android based tablet with impressive specs. A little thicker but lighter than the iPad, the newly announced tablet beats the current iPad2 in sheer hardware specs. While Apple stubbornly continues it’s policy of controlling every aspect of device development and marketing, Google is allowing ODMs to accelerate the pace of device development and developing the software to keep pace with these developments. We have seen this before – with the PC market. While Apple kept pushing the envelope on PCs, they failed to take advantage of the growing demand for PCs. That void was ultimately filled by Microsoft who took on the role of a fast follower and successfully created the eco-system around DOS, Windows and Intel based PCs. As the tablet market grows globally, is Apple doomed to repeat the mistakes of the past?

To be fair the two situations while similar are not exactly the same. When the PC market took off, Apple did not have a dominant share like they do with the tablet market today. In other words, it wasn’t Apple’s market to lose like it is now. That said, the growth rate of the tablet market is far greater than the growth rate of the PC market so the risk of not
being able to satisfy that demand is very real. As market demand expands companies such as Samsung, LG, HTC and traditional PC makers will attempt to satisfy that demand with a flurry of products. As market demand expands, the one size fit all strategy currently followed by Apple will not be effective. While nobody expects Apple to sit still, Apple will need to accelerate product development and manufacturing but it is unlikely that any one company will be able to satisfy that demand. This opens the door for alternatives and especially for Microsoft who is well poised to take advantage of this growth starting with
the release of Windows 8 in 2012. This begs the question – will Apple be relegated to a minority status as the market grows around it?

Another difference between the PC market and the tablet market is the dominance Apple has in the apps space. But is that dominance overstated as the world moves to Cloud/web based applications? Sure there will be a lock-in effects for some types of applications – those that use specific hardware features but we expect the vast majority of applications to be platform neutral at least in terms of their consumption. The popular game Angry birds is a good case in point which started out as an iPad application but is now available to
users of the Chrome browser as a web app. If the vast majority of applications are in fact web apps then how will Apple (or for that matter Microsoft and Google) continue to gain leverage so that new consumers for tablets will choose the iPad over other alternatives. That leverage could come from new, better hardware and from expanding the product portfolio. Both of those things are happening outside the Apple universe right now.

Abhijeet Rane
Techaisle

Techaisle's recently completed channel surveys show that Cloud, Mobility, and Managed Services Solutions together are beginning to change the SMB channel landscape as these solutions are revolutionizing IT utilization by SMBs. However, only 14% of channels are currently offering all three services to SMBs. The new paradigm would be the “3-in-1” Channels offering Mobility, Cloud, and Managed Services as a single offering.

Our research shows that SMBs want mostly integrated solutions to limit complexity and therefore seek partners that are capable of such deliverables. However, very few partners currently do so as they are all camped in either one or two solution corners and few seem to embrace a holistic solution view – and this is making SMBs unsure of overall benefits and desire to spend.

We feel that it is important for broad product/solution vendors to rapidly evaluate all their partners, seek and cluster partners based on where they are with regards to capabilities of delivering complete solutions and introduce programs to support development.

Resellers should look at their core skills, financial support and asses if they are capable of developing a market accepted value proposition encompassing all three key areas or seek collaborative relationships with other partners in areas they are weak. Here, vendors can also help in partnerships.

So far, Managed Services has been the most important offering and implementing Mobility Solutions is a new line of business for SMB Channel Partners.

Survey data shows that VARs are quite proactive in initiating discussions with their SMB customers for Cloud Solutions. Nevertheless, 31% of the VARs mention that vendors are pushing them to offer more Cloud Computing Solutions.

Channel partners that are able to deliver a suite of services that cut across Mobility, Cloud and Managed services will find SMBs that are willing to listen to them. The march towards Mobility and Cloud cannot be stopped. The only course for channel partners and vendors is to find the optimal intersection of the three. These “3-in-1” partners will define the next channel landscape.

In-depth analysis is covered in Techaisle’s report titled “Channel View- Trends & Challenges in offering SMB Mobility, Cloud, & Managed Services Solutions.”

Tavishi Agrawal
Techaisle

There is a continuum from smartphones to notebooks, with a variety of sizes and operating systems. The market will continue to be in a state of flux for several years before showing any signs of stable continuum.

• Widespread adoption of cloud-based apps as well as VDI will make the OS and form factor comparatively less important

 

• Apple will continue to have the “cool” factor in its favor, especially for those using non-office apps

 

• While most vendors have not been able to match Apple’s cost/price advantage (which continues to exist despite its cool factor). However, this will change as Nokia (along with new vendors from low cost economies) begin to manufacture mobile devices in large numbers at low prices

 

• Android developers have had the flexibility of implementing their own versions of Android (in order to distinguish themselves) although this is like to become less of a factor in the future but that itself becomes a problem of consistency and uniformity

 

• Apple’s advantage in terms of no. of apps will soon diminish due to several factors:
  
  
  • Of the hundreds of 1000s of apps, only a few hundred bring in majority of revenues. Most Apple ISVs are part-time developers or unprofitable and will disappear from the market
  
  
  • The vast number of Windows-based apps developers will quickly adapt their apps to Windows mobile, diminishing Apple’s apps advantage and give businesses more relevant business-related apps
  
  
  • While currently, the focus is on horizontal apps, vendors will find it increasingly important to develop vertical apps  to expand the user base and obtain higher margins
  
  
  

 

• Businesses will need to support multiple devices/mobile operating systems – making remote mobile device management an expanding market. Telcos, hosting companies and channel partners will play an important role in enabling that support

 

• Additionally, synching up different devices will also become more important and VDI will help in achieving that objective

It is too early to project future shares of various device forms and mobile operating systems as the market will continue to be in a state of flux in the next few years. We cannot write off Microsoft Mobile or Nokia. They will helped due to their vast size and resources, deep commitment and large number of users/developers.

On the other hand, Android developers/devices are a varied lot, with each having a low share of the market. WebOS (Palm, now owned by HP) has some promise but it is unlikely to regain its glory days of late 90s. RIM is the most at risk due to the proliferation of new devices and mobile operating systems

Although smartphones have the potential of increasing their employee productivity, it will happen only for those employees who are smart enough themselves.

Anurag Agrawal
Techaisle

On 2^nd of March, Cisco made three new product and service announcements for the small and mid-market business segments. With these announcements, Cisco is continuing to show its commitment and focus for empowering the SMB segment and enabling its partner community to efficiently and effectively serve such market.

These three new announcements are a new platform for SMB collaboration (UC300 & BE 3000); a program to empower partners with the resale of WebEX solutions; and improved sales support to the SMB partner community with the Partner Advisor. These offerings are immediately available in the US and UK, and will gradually roll out in other European countries as Cisco completes the localization activities.

SMB-tailored products

The Cisco UC300 series is a very important step towards empowering small businesses to have a voice of their own, literally. Priced at US$165 per user, UC300 series can support up to 24 users and provides one single platform for voicemail, wireless, auto attendant, remote access, and mobile links. We feel this is an important and affordable platform for many of the small businesses who are still sitting on the fence as far as having a well connected communication and collaboration system among its employees. It is also extremely suitable for those small businesses which have grown organically and have multiple communication devices and have either fully or partially deployed VoIP systems.

For higher end small business users and the lower end of the mid-market businesses, Cisco announced its Business Edition 3000 which can support up to 300 users and is priced at US$100 per user. The platform not only provides capabilities for a single number, soft phones, auto attendant, click to call, mobility link, but also is able to connect up to 10 different sites.

Technologies such as collaboration and web conferencing are increasingly becoming important to SMBs to satisfy their priority to make employees more productive. As SMBs tighten budgets for items such as travel, such collaboration and conferencing solutions take center stage. While some solutions have been around for a long time, we believe that broad adoption among SMBs is upon us as evidenced by the priority assigned to such technologies vs. the current level of penetration. And with the announcements of UC300 and BE 3000, Cisco is playing right within the sweet spot of empowering the SMBs.

Similarly, mobile devices and enabling technologies are perhaps the most exciting space today remaining somewhat resilient even in a severe downturn. SMBs have always had a strong desire for mobile products and things became more interesting since Apple released its iPhone. As smart phones expand their empowering abilities, SMBs have strongly taken to accessing email, conferencing, collaborating and using social networking when mobile. A unified, affordable and simple to deploy platform suddenly helps the small businesses.

Small businesses have actively begun to use social media to create awareness about their business. According to Techaisle’s most recent survey, 70% plan to use social media in the next 12 months which is a positive sign, however 45% are not sure how it could help their business. Nevertheless, it is comforting to know that platforms from Cisco can provide that consolidated enablement across all different devices and solutions that are being used by SMBs. Another recent survey on Cloud Computing shows that besides industry specific applications, communications/collaboration and general business productivity applications including CRM are fastest growing. The inflection point for cloud based services is evident when business hit 20 or more employees. This again points to the fact that Cisco seems to have done its homework and instead of following a technology paradigm, has introduced a real business solution paradigm.

More focus on supporting Partners with dedicated personnel

Cisco announced also the introduction of Partner Advisor. With this enabling element of its partner programs, Cisco is catching up with the more traditional instrument of back-office support that is customary for the small/mid-sized reseller. Cisco Partner Advisor, which is to be deployed globally during this year, includes a one stop source for sales support and information such as product selection, promotion, pricing, financing and ordering.

The Cisco Partner Advisor is to be delivered both through the use of a dedicated myCisco online portal and, more importantly, with dedicated live agents’ organization – recognizing that distribution is a people business and resellers requires personal touch. The physical locations of the agents’ organization and their ability to solve issues for resellers will be the test ground for success of this investment Cisco is making. Dedicated to support the smaller resellers, not all Cisco’s partners will be allowed access to the Partner Advisor services.

Andrew Sage, Vice-President of Worldwide Small Business Sales, Cisco said at the announcement, “Our partners are the center of our business at Cisco, and we will do whatever we can to help them succeed. Our new Cisco Partner Advisor initiative uses both people and technology to help our small and mid-market business partners to begin or continue working with Cisco to get the immediate sales and programs help they need.”

Partner-Led WebEx: Cisco shows how the channel can drive Cloud Services

Cisco is bullish here, and rightly so. A chance to talk to customers, different ways to sell collaboration features, application sharing and complementing the new product launch, Cisco announced that Partners will be able to bundle or resell in their offerings Cisco WebEx Online Services.

Whilst this will be offered to users at published prices, this enabling & recurring revenue stream has all the writings of a strong lock leverage which competitors will find difficult to neutralize in the quest for new partners. Additionally, this appears to be a great integration example for Cloud based services offered by the reselling channel for others to follow.

Ian Pennell, Senior Vice-President, Small Business Technology Group and Co-Chair, Small Business Council, Cisco also showed his commitment for small businesses and the partner community that serves that segment by saying, “Cisco continues to be 100 percent committed to giving our partners and the customers they serve the easy-to-use technology innovation they need to succeed. Our partners and customers have told us they want simple unified communications solutions to help them stay ahead of their competition. Cisco is ready to meet that need.”

Paolo Puppoli
Tavishi Agrawal
Techaisle