New CompTIA Report Says the Future of the Channel Is Now

Every year, IT industry analyst firm CompTIA releases its annual IT Industry Outlook report. The report features a mix of hard data surrounding macroeconomic issues and expert insight from CompTIA analysts based on observations of what’s going on in the industry. Together, they form an insightful picture of evolving trends in technology, the workforce and the channel. We took a deep dive into the channel aspects of the report to find out where the experts say partners should be focusing in 2017.

The future, says CompTIA, is upon us. Not only is it quickly cementing its place at the top of the business hierarchy, with the top five most valued companies all being tech companies, it’s changing the very nature of business itself. Now, every company is trying to be a tech company to some extent, and the digital transformation is driving evolving opportunities and shifting paradigms for the industry as a whole and the channel in particular.

Adding to tech’s supremacy in the markets is a sense of optimism and opportunity. CompTIA’s Q1 IT Industry Business Confidence reached a new high, and the firm projects global IT industry growth of 4.1 percent in 2017, pushing the industry past the $3.5 trillion mark by the end of the year.

The report identified 12 industry trends to watch this year. When it comes to partners, CompTIA analyst Carolyn April told The VAR Guy that the channel is at an inflection point.

“New business models and alternative routes to market for technology are proliferating. And a growing number of non-IT line-of-business buyers are flexing their spending muscle and forcing the channel to rethink sales and marketing messaging and shift how they do business – and in many cases, with whom,” April said.

But the “new faces” identified in the report aren’t confined to LOB buyers. Just as non-traditional companies in the manufacturing or healthcare sectors are increasingly repositioning themselves as tech companies, there are also new, non-traditional partner types like digital marketing agencies and SaaS-based resellers.

“These companies are establishing their own beachhead in the channel and quickly expanding the competitive landscape,” April explained. “Their numbers remain elusive at present, but consider alone that more than 100,000 SaaS partners attended Salesforce’s Dreamforce conference in 2016 and you get the picture.”

So what can we expect to see as the channel evolves? April tells us the balance of power between vendors, partners, distributors and end users will continue to shuffle and flow. In fact, a partner mandate for vendors to retool their partner programs is one of the main trends the report forecasts, as traditional incentives such as sales spiffs and backend rebates become less relevant in a market based on services.

“New cloud vendors with no channel presence at launch will recognize the need for indirect partners as they mature,” says April. “And the types of partner programs, benefits and incentives those companies design will differ significantly from legacy vendor programs.”

Vendors aren’t the only ones that need to pay sharp attention to changing market forces. While the tech industry as a whole now seems to be almost entirely driven by a younger workforce, and we can’t go three days without hearing about the rise of the millennial, the traditional channel has yet to really welcome next-generation entrepreneurs. But the report points out that an estimated 40 percent of the channel is set to retire over the next decade, so it needs to seriously start looking at how to recruit new blood.  

Finally, says April, we will continue to see IT and business consulting take a lead role in the channel’s value propositions and revenue streams. The role of trusted advisor isn’t going away anytime soon, and the increasing number of vendor-based cloud companies is creating another new channel role: vendor manager. The report explains that as customers navigate the tricky waters of cloud technology, they’ll need a liaison between them and cloud-based vendors and service providers.

“It’s a lot to mull over. But in the face of it all, the channel has remained mainly upbeat, though not naïve, about the future.”

The technology and workplace trends outlined in the report are as follows:

Click here to read the full report.