Distributor Avnet Technology Solutions (NYSE: AVT) has been tapped by Cisco Systems (NASDAQ: CSCO) as a specialty distributor for Cisco’s data centre products in North America, and will form a dedicated business unit around the Cisco business, to complement its IBM and Sun Microsystems-focused businesses.
Focusing on Cisco’s Unified Communications System (UCS) and data centre business, Avnet will be carrying the Nexus data centre family of switches, the MDS family of fiber channel SAN switches, Catalyst E-Blade switches, UCS blade and rack servers, Application Control Engine, and WAN Optimization.
“We’re pretty excited about the announcement to add Cisco as a leading supplier to our portfolio,” said Jeff Bawol, president of Avnet Technology Solutions. “It strengthens our ability to offer a more robust and complete data centre solution to the market.”
A dedicated Avnet business unit will take the Cisco offerings to market in line with Avnet’s model as a solutions distributor, developing vertical and technology-focused practices such as SecurePath, StoragePath and VirtualPath. Avnet will also develop Cisco-focused enablement and service offerings for its VAR partners.
“We’re moving towards solutions distribution, with a vertical approach in areas such as health care, government and education, and solution practices such as virtualization, storage and unified communications,” said Bawol. “Cisco is a great addition to that direction we’ve already been heading in the last couple of years.”
Looking at Avnet’s partner base, Bawol said many of their partners are already engaged with Cisco. They’ll realize advantages by working with Avnet for their Cisco business as well. But Bawhol said there’s also lots of opportunity to introduce other Avnet partners to Cisco-enabled data centre solutions.
“In data centre products, we do have a fair amount of education and engagement to do in helping that partner base get into the market as it goes forward,” said Bawol.
The addition of Avnet as a specialty distributor is the latest in a string of recent distribution moved by Cisco. Westcon Group became Cisco’s first global distribution partner in April, quickly followed by Ingram Micro and Tech Data. Later in the year, Westcon brought its Cisco-focused Comstor band to Canada. Cisco also works with D&H Canada and now, in Canada, has added Avnet.
Dave O’Callaghan, vice-president of distribution, worldwide channels for Cisco, said the vendor believes Avnet is uniquely positioned in the industry to bring virtualization into the data centre with Cisco partners. He sees the Avnet partner base as very data-centre centric representing strong incremental growth prospects for Cisco, he’s impressed with their technical services and lab infrastructure, and he likes their marketing strategy if drilling down into segments and verticals rather than just verticals.
While the recent flurry of distributor signings may seem to raise the question of over-distribution, in fact O’Callaghan said Cisco has actually decreased its distribution partners over the last three years. He also sees good potential for this new segment of Cisco’s distribution strategy that Avnet will play in, the high-value specialty distributor.
“We really look at our distributors’ profitability and make sure we’re being properly optimized in distribution,” said O’Callaghan. “We have three globals (Ingram Micro, Tech Data and Comstor), a set of regionals for those relationships, and now we’re launching the last space, high-value specialty. Selling the data centre and server solution is very different from selling high-volume switching. Partners here are looking to the distributor to round it out with their whole line card and bring a solution to the table.”
There will be strong competition for from other distributors though for Avnet to win Cisco business, and Bawol said he welcomes that competition.
“We love to compete, the one thing I think we do well is compete,” said Bawol. “We’re ready to compete and we think we gave a good value offering to compete with. They’re good competitors, but we’ll take the challenge on.”