Channel Sales & SaaS

Much is written about how Software as a Service will kill the indirect channel. SaaS vendors flip a switch and the application is live. It seams that the 250,000+ US based VARs and resellers go out of business any soon. But wasn’t that the story when the Internet came into existence? Or earlier when CDW opened their doors? Or… 1850 when the industrial revolution started?

N O – the channel isn’t going to die!
I recently talked to a few executives in medium and larger size organizations. And there was 1 single question that makes it so obvious what role a channel needs to play in SaaS: “Who has the capability to help us put it all together” – “Who can help me composing my new IT world which may consist of multiple vendors for different jobs i.e. Sales, HR, Expense Management and so forth”. The channel business simply hasn’t really started yet. But here are already several cases with great success stories.

B U T – the new industry needs a new type of channel.
There is no need for a warehouse, for technicians to install and configure software. The new world needs business savvy and business process aware people. There is no margin to be made from reselling but money from consulting, implementation, integration and ongoing maintenance. Feel free to download my whitepaper at Tanooma.

SaaS is not only no danger for the channel – it may actually be the biggest business opportunity in IT history. About 1 Million early adopter started with SaaS so far. About 750 Million will join the party in the next 10 years or so. That requires 1 – 5 Million Channel partners to act as catalysts for that new industry; it may turn out an even bigger channel than in the traditional IT industry.