The cost and complexity of the cloud

Phoenix – The fact that Ingram Micro is hosting its 4th annual Cloud Summit should bring the channel to the conclusion that cloud computing isn’t new anymore.

This was one of Renee Bergeron’s key messages at the event. An event that broke attendance records; more than 800 solution providers took part in the three day conference.

Bergeron, the vice president of managed services and cloud computing for the distributor, told CDN that in year’s past this event was all about education on that the cloud opportunity is. Today, however, it’s not about education but about winning in the marketplace.

This shift in focus was one of the reasons for Ingram increasing the number of cloud vendors and solution in its Cloud Marketplace.

CDN sat down with Bergeron to ask her about Ingram’s Cloud Marketplace along with other cloud related topics.

The following is an edited transcript.

CDN Now: Is Ingram Micro’s strategy with cloud computing just to continue to build onto its cloud marketplace or will there be more to it than that?

Renee Bergeron: With the new vendor partnerships we have reached 170 cloud solutions from 53 vendor partners. In Canada we’ll have 120 cloud solutions from 40 cloud vendors. Over the past two years Ingram Micro has invested in building a cloud team and a road map for the cloud. We have a service advisory council and they tell us the needs of the marketplace. We also do research on how the cloud market evolves. These new cloud partnerships open up a new realm of services for communications and we started on the telecommunications channel. We saw that customers are asking for a provider who can offer cloud with communications services such as Internet connectivity, voice and data and they want it bundled. We believe this will offer better cross selling and increased revenue streams for channel partners. We also see that resellers are earning the same revenue from selling traditional routing and switching and we intend to bundle that with the Telco service. We also did deals with CenturyLink and Time Warner Cable. This is not for Canada at this point in time. We will launch in North America and then follow up in a matter of weeks in Canada.

CDN Now: One of the more surprising announcements from the Cloud Summit was Ingram’s hardware-as-a-service offering. Why did you want to create this type of service and why release it now?

R.B.: We have partners who buy a desktop and a laptop and that’s standard at a distributor. Now we are asking them to buy it in a different fashion and as a packaged service. They will pay for it on a monthly basis and with that there will be no need for upgrade in investment. With hardware-as-a-service we can take it to market nine different ways with configurations form Lenovo and HP. Windows Office will be part of the base configuration and the channel can then add a lot of cloud options onto that all on a monthly price. These will be power-user type notebooks that will meet the needs of basic business users and enterprise business users. We are releasing this now because we are really thinking about helping the reseller step away from selling a commoditized product. We will be making available more tools to help the channel bundle services on these notebooks. The more they can differentiate them better they will be able to justify their margins. The hardware-as-a-service offering is a natural progression for Ingram Micro and we see the same for customers. It’s IT in a box with pre-integrated solutions. This will help them differentiate and eliminate some of the complexity with IT. We will start with Lenovo and HP for now but Ingram is a distributor and the number of partnerships that are possible is infinite.

CDN Now: How has Ingram Micro’s value proposition for the cloud changed over the years?

R.B.: By program extension. We try to put things in place that will empower the reseller to grow its cloud business such as training programs, this Cloud Summit event, and monthly road shows. These will add to their success and help them realize they need to get with the cloud. I hope they see our value proposition and help us build the experience in the cloud in order to scale it up. Solution providers need to figure out how to invest in the cloud today and that can be a challenge. We launched a program called Seeding the Cloud. It’s a marketing and reseller enablement program, which provides channel partners with the resources needed to design and execute a go-to-market plan, as well as drive end-user lead generation for cloud services.  In a nutshell this program is going to help their cloud business grow over the years by helping to fund their marketing activities. Vendor partners such as Cisco, Montreal’s ShareWeb and Trend Micro have set aside some funds for this concept. The reseller will need a good cloud business plan. After approval we shall free up the funds for their marketing activity through Ingram Micro or the participating vendors.

CDN Now: How have SMBs taken to the cloud these days?

R.B.: If you look at the portfolio we have 4,000 or so resellers that buy cloud services at Ingram Micro on monthly basis and the larger volume of those are smaller end solution providers. Over the past 12 months I have seen larger companies adopting cloud solutions. Over past year we have seen some cloud complexity such as IAAS. A number of resellers have adopted that on demand strategy but there are some complexities with the configuration of VMs and with moving the workload from an on premise solution to the cloud. What we’ve done is build up our team to support resellers as they go through this. We also created a formal program called Cloud Desk to offer professional services during the proposal stage, pre- sales and post-sales. We will have about 200 tech support consultants for Cloud Desk along with 120 cloud experts to support the channel.

CDN Now: One of the big cloud myths is that the cloud is cheap. Do you think many customers are getting sticker shock?

R.B.: Less today than a year ago. I think the resellers or end customers who are going to the cloud for simple reason of cost are going to be disappointed in many cases. The cloud’s value proposition is not cost but agility. You can be up and running in a matter of days. The utility size is also a big benefit as you pay for what you use and get long term TCO. You also get hardware refreshed quicker. These are the benefits. Sometimes the cloud is less expensive, but cost is far from being the best value proposition for going to the cloud.

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Jim Love, Chief Content Officer, IT World Canada

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Paolo Del Nibletto
Paolo Del Nibletto
Former editor of Computer Dealer News, covering Canada's IT channel community.

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