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COLUMN: The Everything-As-A-Service Sales Spread

CRN Executive Editor Steve Burke says the Everything-as-a-Service pay-per-use channel revolution Is here and Is here to stay.

The Everything-as-a-Service pay-per-use channel revolution is taking off like a rocket.

The global pandemic has kicked the powerful channel model into the stratosphere–effectively compressing three years of channel change into a single 12-month period. This hyper-Everything-as-a-Service model has been accelerated as customers–fed up with an increasingly complex, unsecure, multivendor, multi-cloud IT landscape–are anxious to ink deals with trusted strategic service providers who can build, manage and provide a single pay-per-use bill for IT services from the edge to the data center to the cloud. That end-to-end Everything-as-a-Service model includes telecom services, internet connectivity, SD-WAN, application support and service-level and security agreements.

HPE GreenLake partners, who have been selling the on-premises pay-per-use cloud services model for several years, say the demand for Everything-as-a-Service is a perfect storm given the rush by customers to accelerate their digital transformation/cloud services adoption in the wake of the pandemic.

HPE President and CEO Antonio Neri laid down the GreenLake as-a-service gauntlet three years ago when he took the helm and has driven a massive cultural shift at HPE to jump-start the pay-per-use on-premises cloud services channel revolution. Neri went so far as committing as far back as two years ago to shift the entire HPE portfolio to as a service. Neri does not get the credit he deserves for his 20/20 technology vision, which has given HPE a huge competitive advantage in an increasingly Everything-as-a-Service IT world.

Neri’s bold bet is paying off in big Everything-as-a-Service channel gains for HPE–even as rivals move quickly to try to match HPE’s as-a-service blitz.

Dell Technologies launched its all-out as-a-service charge with the release of its Apex cloud services portfolio at the Dell Technologies World conference in May.

Cisco, which has powered partners through massive technology transitions and has bet big on SaaS-based offerings, told partners at its Cisco Live event in March that it was committed to delivering the majority of its portfolio as a service.

But it’s not just HPE, Cisco and Dell. Every vendor is looking at how to adopt their channel model to win in a consumption-based, Everything-as-a-Service, SaaS world. They know that if they do not move to the new model they are destined to be left in the channel dust.

The big uptick in vendor as-a-service offerings is sure to dramatically expand the channel Everything-as-a-Service market. It is not a zero-sum game. It’s a land grab of sorts that will bear rich sales and profits ahead for all those that work closely with partners to get it right. That’s no easy matter, by the way. HPE has been refining the original channel pay-per-use model–HPE Flex Capacity, which morphed into GreenLake–since as far back as 2016.

HPE invested heavily in “channelizing” GreenLake with significant investments in financial-based business outcome training for solution providers. What’s more, HPE two years ago implemented new terms and conditions on pay-per-use GreenLake deals that limit partner liability if a customer stops paying or defaults on a multiyear agreement.

By the way, the Everything-as-a-Service channel revolution is not a big surprise. The Channel Company detailed the dynamics of the strategic service provider shift in 2015, outlining the paradigm shift in which solution providers sell strategic business outcomes with sales strategies focused on CEOs, CFOs, CMOs and business unit leaders.

A lot has changed since The Channel Company detailed the strategic service provider dynamics, including the global pandemic, which has speeded up the adoption of the Everything-as-a-Service model.

One thing that hasn’t changed is the multi-cloud, multivendor expertise that is the heart and soul of the channel. Call them strategic service providers, cloud providers or VARs, these Everything-as-a-Service providers are fierce trusted advisers for customers, taking away the multivendor, multi-cloud complexity and the security nightmare that threatens every customer, no matter their size.

One big danger vendors will face as they move to the Everything-as-a-Service model is just how committed they are to building an Everything-as-a-Service channel. It’s a heavy load and one that is going to require vendors to make sure their compensation and sales organizations are structured to support Everything-as-a-Service providers.

No vendor, by the way, has the multivendor, multi-cloud breadth and depth that the collective channel offers. The channel has always thrived by integrating multivendor solutions for customers. Now they are integrating multivendor, multi-cloud pay-per-use service models.

Those vendors that believe they can scale, control and manage a multi-cloud, multivendor world by themselves without a robust channel will fail miserably. Just as importantly, they need to make sure they stay sharply focused on driving continued technology innovation with world-class products, services and software.

There are sure to be many bumps along the way as vendors accelerate their Everything-as-a-Service models. The key will be channel commitment, communication and cooperation.

Make no mistake about it: The global pandemic has accelerated the Everything-as-a-Service model. Those that get that will prosper. Those that don’t will perish

 

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