NEC Wants More Than 'Big in Japan'By Sharon Linsenbach | Posted 2008-06-17 Email Print
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With new product launches and a new North American distribution agreement, NEC aims for a bigger presence in the United States.
It's the biggest hardware and software vendor you've never heard of. Its large-scale integration (LSI) chip and embedded DRAM technology drives Nintendo's Wii gaming console, and the company's Automated Fingerprint Identification System (AFIS) helps law enforcement -- real and on prime-time TV shows like CSI: Crime Scene Investigation, CSI: New York and CSI: Miami -- catch criminals.
But the company is often overshadowed by bigger names like IBM, Sun and Hewlett-Packard. Stumped?
We're talking about NEC, and with a new channel chief, a new strategy and a distribution deal with Synnex, the vendor is set to make a U.S. comeback.
"We hear this a lot: 'NEC?! You guys are still around?!' We've honestly fallen off people's radar," says Steve DeBonis, the new channel director for NEC's new IT Platform Group (ITPG). NEC reports worldwide revenues of about $40 billion, and while DeBonis says Europe and Asia are huge markets for the company, their US revenue is a mere $1 billion a year.
"Yeah, we're big in Japan and in Europe -- but it doesn't mean anything here," DeBonis says. "There's dissatisfaction with the market penetration outside those areas, and we have to change that," he says.
Getting back on VARs and customers' radar means a completely revamped channel strategy to rectify past missteps, a focus on reaching and recruiting more VARs and NEC's new distribution partnership with Synnex, announced June 17.
DeBonis says the partnership with Synnex came after a lot of soul-searching. NEC has had a group of VAR partners with varied capabilities all targeting different market needs, but no broadline partners that could expand NEC's product reach and increase the company's importance in the eyes of larger numbers of VARs and their end customers. That's where Synnex comes in, DeBonis says.
"I want to generate relevance, and the way we are going to do that is through a core group of a distributors' top VARs," he says.
But while many other vendors chose larger distributors like Ingram Micro, Arrow, Avnet and Tech Data, NEC chose Synnex for its growth opportunity and individualized attention, he says. Synnex, he says, is making a huge play for the enterprise data center space by beefing up their salesforce and aggressively pursuing vendors like NEC.
"Where could we go and be a contrarian? I don't want to be 6 percent of a distributor's mindshare, I want to go and be their No. 3 vendor," says DiBonis.
"Synnex really wants to grow in the enterprise space, and their enterprise model isn't as mature, and we see in them the ability to help us get to a variety of different partner types," he says.
Bob Stegner, Synnex's senior vice president of marketing, North America, says the enterprise space is ripe for NEC's products, and that while many of Synnex's current VARs will eagerly sell NEC's products, that won't stop the distributor from recruiting more.
"We have a lot of higher-end VARs serving customers that are a great fit; NEC products will go right into their portfolio," Stegner says.
Synnex will distribute NEC's lines of state-of-the-art data center, storage and disaster recovery products through highly skilled VARs focused, DeBonis hopes, on higher-end enterprise customers. He says there's a great opportunity for VARs to use an a la carte strategy to fill gaps in their product lines or coverage areas with NEC technology, but that there are also huge opportunities to put together solutions solely from NEC's product lines.
Of course, these new products aren't much good for the channel without support. DeBonis says for the first time NEC is making an incredible effort to implement resources, personnel and infrastructure to support its channel strategy.
With a team of about 10, DeBonis says he feels this time the company's going to get it right by recognizing and acknowledging past mistakes and learning how to avoid them.
"This is the first time NEC's put together a serious channel team, and I told them numerous times, 'We can't look in the rearview mirror anymore.' We cannot obviously ignore our legacy partners, but at the same time, we can't be beholden to what has gone on here in the past,'" he says.
Stegner says he feels NEC's name recognition (or lack therof) will work in the company's favor. On one hand, he says the fact that DeBonis and others are showing a real, solid commitment to changing the way NEC works with the channel will ensure a healthy rebound in U.S. markets.
"The fact they haven't been involved in the channel for awhile doesn't mean they won't have a great 'bounce back.' They are finally getting the channel. They're not just putting their toe in the water, they're jumping in," he says.
On the other hand, what name recognition NEC does have will ease their entry into VARs portfolios and end-customers, too.
"It's not like they're an unbranded product. It's really recognizable, and while that itself won't win the deal, it'll get you in the door," he says.