Ingram Micro: IaaS Is the Big Untapped Partner Opportunity

INGRAM MICRO ONE — The way organizations consume technology has changed dramatically over the past decade. Software as a service (SaaS) easily rolls off the tongue of many channel partners. Heck, it’s been about 20 years since Salesforce pioneered the cloud subscription software model. What about infrastructure as a service (IaaS)? Is IaaS in your portfolio? 

Channel Futures caught up with Ingram Micro’s Renée Bergeron, senior vice president, global cloud, at Ingram Micro One this week in Washington, D.C. She talked about why she sees IaaS as a big untapped partner opportunity. She also talked about SaaS and Ingram Micro’s investments in CloudBlue, the distributor’s cloud commerce engine, and the benefits to partner. —

Renée Bergeron

Renée Bergeron

According to Gartner, IaaS is the fastest-growing segment of the worldwide public cloud services market. It’s predicted to grow nearly 28 percent in 2019, reaching $39.5 billion — that’s up from $31 billion in 2018. SaaS continues to represent the largest segment of the cloud market, with revenue expected to grow almost 18 percent to $85.1 billion in 2019 – that’s up from $72.2 billion in 2018. 

During his keynote address this week, Nimesh Dave, executive vice president, global cloud, at Ingram Micro, shared some figures from Forrester Research about SaaS companies: In 2008 there were 10,000; in 2018, there are 100,000; and, in another 10 years, we’ll be heading toward 1 million SaaS companies.

Here’s our Q&A with Bergeron.

Channel Futures: Before we talk about Ingram Micro’s investments in CloudBlue, the recently revamped platform and SaaS opportunity for partners, let’s talk about IaaS. 

Renée Bergeron: I have said repeatedly that IaaS is the biggest untapped opportunity for channel partners. Because when you look at SaaS solutions, the indirect channel represents a large share of the SaaS business. IDC reports it as about 55-60 percent. But for infrastructure as a service, that’s not the case. Eighty-plus percent of the workloads go direct with the IaaS provider, whether its Microsoft Azure or Amazon, Google or IBM. 

So this is really an opportunity for partners. 

CF: What’s holding partners back? 

RB: We know that it represents a lot of investment in things like competencies, in terms of associates — they’re different than what you need for SaaS business. Then there’s developing the services. 

So we’ve invested for them in the competencies and capability so that they can offer the life-cycle services to their customer. We can deliver these services white-labeled. We want the partners to develop the competencies, but if they’re not able to invest ahead of the curve, they can leverage us while they’re investing. We can help partners fast-track. 

A lot of partners are telling us that they have more demand than they have bandwidth, so they come to us to supplement their capabilities. For example, in our Azure Center of Excellence, we deliver the discovery and the assessment, the architecture and design, the proof of concept, and the migration — whether that’s a rehost, replatform or refactor. So a lot of partners are tapping into this capability to go after this untapped opportunity. 

CF: Whose infrastructure are you referring to — Azure? 

RB: Azure is a fast-growing solution and Microsoft has a long history of working with partners. It fuels their growth. But we’re seeing a lot of growth in the market with Amazon as well. They’re the two leading horses. 

There’s also IBM, a long-term partner of Ingram Micro. We see a lot of enterprise or larger workloads go to IBM, but more and more with some of solutions we’ve launched on the marketplace, we’re seeing non-IBM partners adopt IBM solutions. 

That’s interesting, but I think that’s what the cloud is showing to all of us — in the past, vendors would invest in building their channel and have closed channels, having to get authorized, trained and certified, [and so on]. But in the cloud, it’s allowing vendor partners to go after a broad set of resellers and not just that are just traditional IBM partners or Microsoft partners, for example. 

CF: So, I’m a partner and I recognize the IaaS opportunity. How do I know which vendor to work with? 

RB: That’s where we bring all of the competencies. We sit down with the partner to understand the business problem they’re trying to solve for the customer, the goals we’re trying to achieve, and we help them understand the benefit of one solution versus another, so that they can make an informed decision about what’s the best infrastructure to support that specific customer and that specific workload. 

Then we use a lot of automated tools – that’s the purpose of the discovery and the assessment – to understand how the application, the workload, is using the underlying infrastructure. That helps us come to an informed decision. So it’s a combination of tools and expertise. 

That shows you the type of investment that a partner needs to make to operate on their own, as opposed to how we make all of that available to our partners. 

CF: If I turn to Ingram services to help with IaaS, do I retain the customer?

RB: Absolutely. This is not a referral model. The partner owns the end-customer relationship. We sit behind the partner, but the end customer doesn’t need to know about Ingram Micro. Our success is when the partner succeeds. 

CF: Now let’s talk about SaaS. I remember hearing that many partners sell one or two SaaS apps and that’s it. Are you seeing that change? 

RB: We are. The number of partners that are selling three or more solutions has doubled since January. There are so many opportunities for partners to maximize their relationship with the end customer, so as part of our Cloud Awesomeness Roadmap, we’ve built a cross-sell journey. 

Maybe your entry point is the leasing cloud solution in the market – Office 365 – but where do you go from there? Put the security on the mailbox, put the backup on the mailbox, put the encryption on the mailbox. And, now that you’ve taken out the Exchange Server, there’s probably a file server there — move this to a collaboration application like Dropbox and from there, there might be a PBX left, so how about we go into voice over IP, a RingCentral or other such solution. 

We show partners a journey so that they can grow the revenue. We also built a calculator to help our partners see how they can take what could be a $5,000 a year deal if they have a small customer with 30-40 employees and they’re selling them mailboxes to $50,000-$60,000 a year. 

Now, you’re not going to sell everything to every customer, but sell another one or two solutions to every customer, you’ve just tripled your business. More importantly, you’ve just locked in your customer, securing that long-term value and loyalty. You’re reducing churn. 

CF: That brings us to the Ingram Micro Cloud Marketplace and CloudBlue. There’s some news you’d like to share.

RB: Our CloudBlue platform continues to evolve very quickly, and so too our Ingram Micro Cloud Marketplace. The user interface has been completely revamped – it’s more intuitive using tiles, for example – as we thought about what a reseller business needs for building solutions, ordering, provisioning, invoicing and helping on the back office side. 

Over and above the new user interface, we launched 90 new features and functions as part of the latest release. We continue to double down on our investment … 750 engineers hired worldwide, that Nimesh [Davé] mentioned. 

The new platform was piloted this summer in a pilot with 100 partners, worldwide, and general availability was in October.