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Resellers Rate Channel Partners
Survey shows resellers love and hate their OEMs
January 5, 2005
3 Min Read
When you think of channel-friendly storage vendors, who comes to mind?
According to a survey by equity research firm Robert W. Baird & Co. Inc., the channel thinks mostly of EMC Corp. (NYSE: EMC), in both good ways and bad.
Bairds fourth-quarter survey of nearly 50 resellers found EMC the most overall channel-friendly storage vendor, despite an undercurrent of negativity.
EMC received the most positive responses (ratings of 10) to the question, “Who is your most/least channel-friendly vendor?” It also received seven negative responses, which Baird analyst Dan Renouard chalks up to a “love-hate relationship” between channel partners and OEM vendors who have their own strong direct sales presence.
The love part of the equation has increased for EMC lately. “I can attest that EMC would have scored miserably if we had conducted the same survey two years ago,” Renouard says. “Some of the ones who consider EMC a good partner now, considered EMC the enemy a couple of years ago.”Some resellers still see EMC as an enemy. Lack of trust, arrogance, and direct-sales competition against channel sales were mentioned by partners who still don’t like EMC. On the other hand, among respondents who like the gang from Hopkinton, Mass., the company was lauded for being easy to work with, sharing resources, and strong lead generation. No other vendor matched EMC's score, having three more positive responses than negative ones in the survey results.
Hewlett-Packard Co. (NYSE: HPQ) and IBM Corp. (NYSE: IBM) also provide proof of the love-hate relationship between OEM vendors and channel partners. IBM received eight mentions for most friendly channel partner, and eight for least friendly, and HP received seven mentions on each end of the spectrum.
The survey found Veritas Software Corp. (Nasdaq: VRTS) clearly the least friendly channel storage partner, which Renouard suspects reflects its recent strategy of going more towards direct sales. Nine resellers identified Veritas as the least channel-friendly vendor, and none said it was most friendly.
One survey respondent wrote of Veritas, "They continue to starve their channel and cherry-pick accounts and deals for direct sales."
Maybe its pending merger with Symantec will make Veritas more channel-friendly (see Symantec & Veritas: It's a Deal). "I don't think it can hurt, given how negative the channel is toward Veritas right now," Renouard says.
Figure 1: 
Other findings from the survey, whose participants represented more than $6 billion in IT spending last quarter:
Resellers felt good about sales in the last quarter and have high expectations for the current quarter. Only 4 percent said the fourth quarter of 2004 was worse than expected, compared to 31 percent characterizing it as better than expected. As for this quarter, 66 percent said their expectations were above normal, given first-quarter seasonality, and none said expectations were lower than usual.
EMC, IBM, and Network Appliance Inc. (Nasdaq: NTAP) were identified as those having the best fourth-quarter sales relative to expectations, and Veritas and Sun Microsystems Inc. (Nasdaq: SUNW) the worst.
iSCSI demand is rising, with 30 percent of respondents seeing moderate demand, 5 percent strong demand, and only 5 percent seeing weak or no demand. That leaves 60 percent with “some interest, but mostly evaluations.” Renouard says the results suggest 2005 may be a breakout year for iSCSI.
— Dave Raffo, Senior Editor, Byte and Switch
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