The survey was designed to answer the following questions:

• What business imperatives are currently having the greatest impact on IT spending?
• What are organizations’ general spending plans for IT products and services in 2012 and beyond?
• How do spending plans vary by organization size, geographic region, industry, and other variables?
• What is driving the changes between 2011 spending and 2012 planned spending?
• What do organizations identify as their most important IT priorities over the next 12-18 months?
• What factors will be most important in justifying IT investments to the business over the next 12-18 months?
• Within specific technology segments—such as cloud computing, virtualization, storage, networking, and security—which initiatives and technologies will sustain investment over the next 12-18 months?
• What is the relationship between an organization’s current and future IT spending and its overall purchasing pattern for IT products and services?

Survey participants represented a wide range of industries including manufacturing, financial services, health care, communications and media, retail, government, and business services.

For more information on the contents and findings of this report, please download the executive summary below.

ESG Research Report 2012 IT Spending Intentions Executive Summary

Why is this so cool?  Some quick factoids from recent ESG research on the “Impact of Cloud Computing on the Channel.”

1. Resellers selling to customers with under 100 employees have a greater percentage of their revenue come from services, including SaaS and Remote Managed Services, than do their larger reseller counterparts.
2. Ninety percent of small resellers state “services” are their #1 source of revenue.
3. Of companies currently reselling some form of cloud services, 29% are still considering offering their own cloud-based services.

Translation–SMB resellers are services-focused–VDI is a services-heavy solution.

Unlike server virtualization, which is largely about cost reduction, the use-case nature of VDI provides a robust professional services opportunity for partners who sell into the SMB.  Customers need consulting around the why and the how of VDI.  And for resellers seeking a direct presence in cloud services, the technology represents a way for them to stand up their own regional Desktop-as-a-Service offering to the SMB, augmented with their own local and remote support services.  With Citrix and a hosting partner, they can  quickly offer these services in a subscription model.

Months ago, I used the word “micro-outsourcer” to describe an emerging trend I saw where smaller resellers could leverage cloud technology to effectively become outsourcers to the SMB.  These partners would provide all essential IT support services for customers under 1,000 employees, and manage all the IT resources in their own or third party cloud environments.  Citrix’s VDI-in-a-box provides another vehicle for the little guy to continue to move in this direction and/or build service practices around VDI.

Specifically, the survey asked the following questions with respect to e-discovery and legal services:

• What are current trends in the volume of corporate legal or regulatory matters, and the percentage of those involving electronically stored information (ESI)?
• What is the internal strategy for corporations in managing e-discovery processes among cross-functional business units? Who leads decision-making in both internal and outsourced resourcing?
• What are current corporate expenses associated with e-discovery, as well as for legal services in general? Is performance being tracked, measured, or evaluated in terms of outcomes, and how?
• What are corporate selection criteria for law firms and legal service providers? What are customer priorities in service delivery?
• To what extent are corporate litigants performing e-discovery internally, and how? What are their greatest challenges in the process? What provisions are they making for court defensibility?
• Which e-discovery technology and methods are corporate litigants using, planning to adopt, or rejecting?
• What are the most important go-forward priorities within the enterprise for internal e-discovery and better overall litigation preparedness?

Survey participants represented a wide range of industries including manufacturing, financial services, communications and media, health care, retail, government, and business services.

For more information on the contents and findings of this report, please download the executive summary below.

ESG Research Report e-Discovery Market Trends Executive Summary

Of the top three motivating factor, all statistically tied for the #1 reason based on the study variance, “desire to shift to a recurring revenue business model” is the  most interesting.  The resellers who are going to succeed here are not followers, they are leaders.  Perhaps they have had enough of the lumpy transaction-based business model most familiar to product resellers.  Perhaps they are looking for long term contracts to increase the value of their company.  Or perhaps they see the writing on the wall, and know that the future of the channel is services with expertise in applications and vertical industry solutions.  Those courting the channel should keep in mind that cloud will not minimize the channel.  It will expand the role of the channel.  Successful programs to leverage the channel for cloud services will provide resellers both the opportunity to add unique value, and offer multi-year revenue streams that will attract the right partners, and facilitate their transformation.

via Dell Debuts PartnerDirect 2.0 Program, Affirms Commitment to Client Hardware – eWeek.com.

Specifically, the survey asked the following questions with respect to the current and planned resale of cloud computing services:[1]

• What actual demand are you seeing for cloud computing solutions from your customers?
• What factors are motivating you to include cloud services as part of your portfolio?
• What steps are you taking to support your overall cloud strategy?
• What are the most important attributes of a cloud service provider channel program?
• What changes are you making to your business model to address the cloud computing opportunity?
• How often are SaaS or IaaS options included in sales proposals and are customers requesting these options?
• What are the biggest challenges you face in transitioning to selling cloud computing services?
• How do you compensate your salespeople for recurring revenue deals such as cloud computing contracts?
• Would you prefer to work with pure cloud service providers or resell cloud services offered by your current technology (i.e., hardware and software) vendors?
• Have you lost business to a cloud service provider where you were proposing an on-premises product-based solution? If so, how often?
• What is your strategy for developing new relationships with cloud service providers?
• How important is the specific technology with which a cloud provider runs its infrastructure to you and your customers?
• What steps can your current product vendor partners take to help you be more successful in selling cloud computing services?
• What should the role of traditional technology distributors be in cloud computing?
• How do these answers differ by size of sales organization?

For more information on the contents and findings of this report, please download the executive summary below.

ESG Research Report The Impact of Cloud Computing on the Channel Executive Summary

via Accenture, DOJ Case: Standard Referral Fees or Sleazy Kickbacks? -  Channel Insider.

As I attempted to cover the channel, the service provider marketplace, cloud, and end-user computing trends, one thing became abundantly clear with every conversation I had.  Cloud was not only changing how IT consumes technology, it was fundamentally changing the selling lanes and the relationships between resellers, vendors, service providers, etc., giving birth to a new ecosystem and in effect “Changing the Channel.” While others will pontificate on the best open-source platform or issues of cloud security, I will focus solidly on the continued evolution of channel business models, driven by the opportunities presented by cloud and the imperative of business owners to evolve to high-value, service-driven, recurring revenue business models.

You’ll hear much more about this in my new blog, Changing the Channel, and about some of the research ESG has completed focused on how reseller business models are changing; how service providers are getting channel religion; how vendors must juggle their role as partner, service provider, and arms merchant; and how some are staring into the bright light, slightly obscured by the clouds, frozen, having no idea what to do!

Whether you are a vendor channel executive, an MSP, a VAR, or some other manner of solution provider, I hope to focus this blog on how to help you succeed in this new paradigm.

“It depends on where they decide to make the cut. Is it way down at the retail level–just the stuff in Staples and Best Buy–or does it go deeper than that?” he says. “It is hard to say right now from a channel perspective what will happen. But it would be an opportunity for resellers to reevaluate their relationships.”

via HP’s Confounding New Strategy: Partners Respond – Channel Insider.

With VMWare’s announcement today, and Citrix’s acquisition of cloud.com–the start of the private cloud marathon for solution providers has officially begun.  Time to stop stretching–and start running.
When I look at private cloud building–I see massive complexity and integration.  These two powerhouse companies, VMware and Citrix, have, or will soon have, elegant solutions to build private cloud.  But it will not be easy.

The real risk for solution providers is for the global and regional SIs to dominate the private cloud integration space and take your high-end infrastructure resell business right out from under you.    Why would an end-user buy the HW/SW from you if someone else is building the rest of the private cloud?  They’re going to buy it from Accenture, or direct, or from CDW–unless you are adding value!  This feels like more of a threat to the enterprise reseller than customers shifting to public cloud vs. owning assets.

There will be fence sitters in public cloud.  But there will be few end-users that mature their virtualized environments to a point where taking the next step to a private cloud computing model won’t make perfect sense.

If you aren’t thinking about building your business around the application and virtualization skills, partnerships, and services to enable customers to build private cloud–then you aren’t thinking very hard about your business.

You can read Jeff’s other blog entries at Speed & Change–the Business of IT Services.