Dell Unifies Its Software Channel
Although change is afoot at Dell—as shareholders vote Sept. 12 on Michael Dell's plan to take his namesake company private—the basic channel strategy the company is developing will remain essentially the same.
Dell will continue to morph into a provider of services that it will sell both direct and through its channel partners. To achieve that goal, the company has been broadening its software portfolio via the acquisition of more than a half-dozen companies, including Quest Software, KACE and SonicWALL.
As part of the company's plan to consolidate its channel strategy around those software assets, Dell is moving toward unifying the various partner programs it inherited via those acquisitions. As part of that effort, Dell announced an array of new competencies under its overall PartnerPath channel program through which qualifying partners can gain access to discounted pricing and market development funds.
In addition, Dell has lowered the threshold in terms of the amount of revenue a partner needs to generate to participate in the various levels of its channel program, while increasing the referral opportunities for partners that recommend Dell software products outside their core competency.
With an estimated run rate of $1.5 billion in software revenue and more than 1 million customers, Dell clearly sees software as an enabling set of technologies for delivering services.
“This as a multi-hundred-billion [dollar] market opportunity,” said Marvin Blough, executive director of worldwide channels and alliances for Dell Software.
But with more than 200 products now in the Dell software portfolio, the challenge is finding ways to get partners that are familiar with only a handful of Dell software products to embrace the rest of the portfolio. Though the company has a legion of hardware resellers, many of them currently don’t sell software or have existing allegiances to other software vendors—something that Dell has pledged to respect.
“We’re pretty open-minded about that,” said Blough. “Our goal is to help make it easier for partners to navigate that.”
Longer term, Dell is looking at increasing the referral fees that traditional hardware partners can receive for recommending Dell software products, Blough said. But for now, Dell is focused on the first step of unifying what has become a massive channel program that will eventually encompass software, hardware and services.
“Dell is making a strong enterprise play that will need to be pushed through the channel,” said Ashar Baig, principal analyst at Analyst Connection. “They’re aiming to be a one-stop shop.”
Michael Vizard has been covering IT issues in the enterprise for 25 years as an editor and columnist for publications such as InfoWorld, eWEEK, Baseline, CRN, ComputerWorld and Digital Review.