Over the last few years, Linux has grown to become a platform of choice for
big enterprises for creating IT infrastructure. Finally, Linux is moving away
from being an operating system that was used only by geeks, researchers or
students. This signifies a big movement in Linux adoption worldwide.
This huge momentum of Linux adoption across the spectrum is rapidly
translating in the Indian marketplace as well. This signifies a big opportunity
for Linux, since India has predominantly been a Unix country.
Reliability and scalability have always been strong traits of Linux, but most
Linux users are unanimous about its USP: the low total cost of ownership and
overall value of running Linux in the enterprise.
RIDING
THE LINUX WAVE
It is a known fact that software distribution channel management is a very
critical function for any software vendor as it represents an extended sales
force. This ensures that the product and support is available at the right time,
at the right place and at the right price to customers. Considering the above
scenario, the timing is just right for any VAR/SI/solutions provider/reseller/to
consider riding on the Linux wave.
The open source model is a very unique, innovative and revolutionary one for
developing software products and solutions. Here the customer benefits from a
global R&D effort–the open source community–that includes millions of
developers across the globe contributing enhancements and innovations to Linux
on a constant basis. Being open source, Linux is freely available along with the
source code to the customers.
HOW TO MAKE MONEY?
There is a new world of opportunities and benefits any channel partner can
get by selling Linux products and solutions.
Today, Linux because of its cost benefits and technology superiority has
become the fastest growing operating system. Channel partners could take benefit
of the increasing popularity of Linux by building a financially viable and a
successful business model based on support and services around the open source
products and technology.
There are many vendors into Linux distributions like Red Hat, Caldera, Suse
and Mandrake among others. To be successful, these Linux distributors are
relying on strong distribution channel comprising of authorized channel
partners, technology partners, ISV partners and IHV partners.
Red Hat, for instance, has evolved a very successful and viable business
model based on enterprise-class support and services providing a reliable source
and final escalation point for all enterprise customers for their
mission-critical Linux deployments.
Since, Linux has huge cost benefits, it has a very natural and wide
acceptance amongst corporate customers. This provides an area of opportunity to
channel partners to get into a very strong relationship with the customer, in
the process, engaging enterprises to provide value-added services on Linux
products and solutions.
Moreover, channel partners can add a lot of value to the sales process in
terms of information, availability of products and solutions, and providing
services such as installation and onsite support, which the customers expect
locally.
WHAT PARTNERS CAN LOOK FORWARD TO
Linux distributors provide channel partners an opportunity to replicate the
same business model as their own (that is of support and services), ensuring a
healthy bottomline for his business. This is contrary to the ever increasing
pressure on prices due to competition and shrinking margins in closed source
software sales.
By positioning Linux as a technology with a tremendous price/performance
solution to any IT manager, partners stand to gain instantaneous acceptance as
they address critical concerns of enterprises like costs, robustness,
scalability and availability of universal technology. More importantly, the
customer views channel partners as consultants, which is more fruitful
association.
Partners get an opportunity to resell any Linux distributor´s comprehensive
support and training services as an additional revenue opportunity, which may
include implementation support, migration support, annual Support contracts,
incident-based support, 24x7 support, remote managed support, high-end
consulting and engineering services and corporate training. This enables the
channel partner to provide an end-to-end solution to the customers with a
limited investment.
In this process, a partner can develop his own internal skills on a
particular Linux distribution and build a similar model for providing basic
support like installation, implementation, onsite support and annual support.
Linux also provides multiple opportunities to cross-sell and up-sell high-end
products and solutions to the same customer. For Linux to be successful, many
Linux distributors are getting into OEM relationships where Linux OS comes
pre-loaded with OEM´s servers and desktops.
Even availability of enterprise applications on Linux platform is becoming
popular. This provides a huge base of customers for channel partners to provide
support and training services on Linux.
SELECTING THE RIGHT DISTRIBUTOR
While choosing a particular Linux distributor, a channel partner should look
at few critical factors such as product reliability, price/performance, market
leadership, tech support, return on investment, licensing options, training and
certifications, marketing support and field sales support, which is the
cornerstone of any successful channel relationship.
However, the real formula of success in the Linux business is the focus,
determination and strong belief to build a strong and successful model based on
Linux.
One example of such focus is GT Enterprises, who has built a very innovative
and successful business model on Linux. GT Enterprises started in 1995, with a
goal to serve end-user/resellers with Linux and Linux-related software. It has
grown from a handful of customers to a single-stop shop for Linux and open
source products. It carries over 300 products, 250 manuals and documentation.
Defying the conventional VAR model of handling multiple products from
multiple vendors (increasing the overheads of resources and time), GTE focused
only on Linux as a technology over the last seven years in business. In this
process of hard work and efforts they have been able to create a niche for them
and customers have started associating Linux with GTE as a "single-stop
shop" and an informed source for anything and everything on Linux.
By building similar competencies and portfolio of services around Linux, a
partner can invent new and innovative models in the competitive channel
business. And considering the diverse opportunity areas that Linux offers to the
channels with the increasing rate of corporate adoption, only the sky may be the
limit.
AMIT BHORASKAR is Channel Manager, Red
Hat India