CompTIA: Emerging Technologies Expected to Drive Vast Change Across the Channel

CompTIA’s new State of the Channel study reveals emerging technologies are expected to be the No. 1 driver of change across the channel in the coming years.

“The ability to build a business around artificial intelligence, virtual reality, blockchain, drones, IoT, [and so on], will take companies into a future growth path, for sure,” the report concludes.

Despite this, challenges stand in the way of partners fully realizing the potential of new technologies, says report author Carolyn April, senior director of industry analysis at CompTIA and a frequent Channel Futures contributor. (April, who will speak at the upcoming Channel Partners Evolution event in Philadelphia in October, completed a study on operational efficiency in May.)

“Emerging technologies represent a big opportunity as customer demand is literally pulling partners in new areas. But they present a challenge due to the skills gap that exists between what the channel currently can provide and what future customer expectations will be,” says April.

In the study, 42 percent of respondents say the current skills gap is a factor that raises some pessimism about the channel’s future. So long as traditional VARs, MSPs and IT consultants can update their skills, however, partners can make significant gains selling, managing and securing new technologies, says April.

Another trend showcased in the report is company “specialization.” Today, more partners are differentiating their businesses by specializing in a vertical market, business function or customer segment. According to the new study, nearly two-thirds of channel organizations sell to customers clustered in one or more vertical markets. (Professional services, manufacturing, retail and health care are the most popular verticals, for example.)

Six in 10 partners, meanwhile, say their customers demand vertical-market expertise, while more than half say vertical market specialization leads to greater revenue opportunities. Again, training and hiring challenges loom large. Forty-five percent of channel companies, for example, say the cost of entry into a new market creates a barrier, while 43 percent say the difficulty hiring staff does.

In addition to emerging technologies and specialization, CompTIA’s new report focuses on another trend in the market — the growing size and scope of the channel.

“The channel ecosystem continues to expand with new players providing technology products, services and solutions to customers,” says April. “That’s created a good news-bad news scenario for traditional channel partners.”

The bad news, she notes, is more competition from independent cloud-based software vendors (ISVs), digital marketing agencies and professional services firms. But the good news is that traditional partners have new opportunities to partner to extend a footprint in a market that’s growing in size and complexity.

This helps explain why so many channel companies are upbeat about the future. In fact, the study reveals, partners are more optimistic than they were two years ago when CompTIA last completed the study. This year, three in four channel companies say they are optimistic about the channel’s future. That compares to 63 percent in 2016. The opportunities presented by cloud computing, survey respondents said, are the No. 1 reason for their upbeat expectations. That’s a big change from just a few years ago when partners viewed cloud computing with a wary eye.

An upbeat economy, obviously, has helped lift expectations. But there’s no denying that the channel continues to build momentum.

For more on the study, tune into this edition of CompTIA’s Volley podcast. In the episode, April discusses the State of the Channel study with Seth Robinson, senior director of technology research and analysis at CompTIA.