Where Are We Now? Ode to the Agent

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Where Are We Now? Ode to the Agent

After the news hit (for some on Friday night, for the rest on Monday morning about ScanSource buying Intelisys), where does that leave everyone? That has been the big question on everyone's mind.

Do the sub-agents get screwed in the ScanSource deal?

What Changes? That is the big one because we HATE CHANGE!!! Well, maybe more precisely, we FEAR change. Yet we work in an industry that is not only in constant change, but in the midst of big, faster change - with more coming.

Many partners have been in the game since the 1990s. Some of them want to retire. Some are tired of this sh stuff. They don't enjoy it anymore. They don't give a hoot about the cloud or UC and now comes SD-WAN. F*** Me!!! It's too much. Too complicated. Top that with buyers who think they are educated (and we have to re-educate). Other buyers just want simple. (I hear about this everyday as they ask not for UCaaS, but SIP trunks or just dial-tone.)

So we will see more M&A as partners transition out.

We will see a couple more VADs merge with masters. Why? Copycat Effect coupled with the very real Wall Street declining revenue effect. For example, Tech Data did $27.7 billion in sales in 2015, $26B now. That is the cloud effect on VADs. They need MRR. The VADs have tried MRR via partnerships with masters and rolling their own cloud services. They will need inorganic growth to counter the revenue decline. (And hey money is free today for a public company!)

The other point comes from a Juniper blog post about how MRR increases valuations today (if you care about that sort of thing.)

On the W-2 side of the equation, things have changed in the channel as well. It used to be that Channel Managers would become Agents. (See Aligned Communications, GCN and others.) Not as likely today.

Instead the CMs cycle through a bunch of carriers until they run out of options. Then they either take a position with a master agency or join the cloud services world, which is entirely different than the telecom world that they are used to.

Selling has changed. What we sell has changed. The WAN is very complicated now. The services catalog from vendors is huge and relatively unknown. There are too many acronyms. There are too many vendors. (Stat from CompTIA: 600 new vendors entered the global IT arena; meanwhile, the number of partners have declined.) I'm tired just writing that.

Top that off with M&A that scares the heck out of partners who are in a constant state of panic about commissions. There aren't many partners who have not been screwed on commission at least once. Every M&A deal results in one question: Am I still getting my commission check?

As we head to DC for another channel show, the buzz will be about the ScanSource deal as well as Shoretel up for sale. Hopefully some SD-WAN buzz and plenty of time for coffee. If you are going to the show, partners are meeting for drinks at 7 pm on Tuesday, 8/16 at Granite City Food & Brewery, one block from Gaylord. Join us!

Related Articles to 'Where Are We Now? Ode to the Agent'
Featured Events