i365 needles VAR channel Giving the VAR channel a "poke with a hot needle" is i365's idea of an attractive offer giving small and medium enterprise resellers a way into the cloud backup service business. The company, fully owned by Seagate, sells the EVault – software running in an X86 appliance – to back up data to its data vaults in the cloud: which …
This was sent to me by Eran Farajun, executive VP at managed backup provider Asigra (www.asigra.com) who had his own thoughts about the i365 channel business model. They follow on below.
Chris.
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i365 has an evolving channel partner model and it remains to be seen (over a 3-5 year timeline) whether they are indeed committed to working with VARs in a clean model or if this will ultimately amount to another way of seeding the market for i365 to take the customers direct. Why do I say this?
Let's look at their record. When they first stepped into the UK market, they worked with InTechnology and others who helped them build their market in the UK. Then they opened their own offices and "vaults" in the UK and started to sell direct and compete with their own partners. Now let's look even further back in history, across the pond in North America. i365 is a service provider and regularly competes with their service provider partners on deals. What happens if a partner no longer wants to work with i365?
The customer data is already in i365's vaults, so it ends up staying there, and the VAR is left with the choice of either "forcing" their customer to re-backup their data to another backup provider, or the VAR opens up his own "vault" and then needs to re-backup the customers data (never a pleasant task). Or the VAR can just "give up" the customer and concede to i365 (VAR loses). It seems that i365 is not consistent in their channel strategy, and their history shows it.
For Seagate, which is a global company, to have a "direct" approach in the USA/Canada, and a direct & channel approach in Europe is confusing. It feels like "we'll try this and see what happens. If we don't like it, we'll do what we did in the USA and continue to go direct." For the VAR to be replicating "their" vault to i365 may be seen as a camouflaged "seeding" and i365 can then possibly elect to go direct later if it wishes to do so (they have vaults in Europe -- are they shutting them down and migrating current direct customers to VARs? Not likely.).
Is i365 giving any guarantees that it will never sell directly to the VARs' customers? (whose data i365 has a copy of).
The key question is: why can't a partner elect *not* to replicate to i365?
The answer? Because replicating to i365 is a recurring revenue to them and just a way to have the partner "pay" for the software in a different way. This is good for i365. But is it good for VARs? We'll know in 3-5 years. So in summary, i365 is an *evolving* channel program and has a history with an inconsistent past and inconsistent actions in different markets. Some historians hold that history evolves. Others hold that history just repeats itself. If not managed carefully, a "hot needle" can easily burn you. There are alternatives for those partners who don't want to risk their customer relationships (i.e. their currency) but want to deliver their own cloud backup service and keep the profits in-house without looking over their shoulder.
Having experienced both i365 and Evault (prior to the Seagate acquisition) InTechnology have always regarded this vendor as a true partner that listens to its resellers and service providers. We have been working with i365 / Evault since 2004 and have found that their approach to making the partner model work has being nothing but exemplary.
i365 / Evault have continuously evolved their offering based on the feedback they have received from us and our end user customers. Their product development, support, business development and senior management teams are very supportive and pro-active to ensure customer acquisition and retention is optimised wherever possible.
As a business InTechnology has worked with a large number of backup software vendors over the years, incl. IBM, Asigra, Symantec, HP etc., but none have shown the commitment, effort, willingness and partner support that is being delivered by i365 / Evault and that is expected by our business and our customers.
Xanadu assessed Asigra and i365’s data backup and replication offerings and we opted for the i365 as we felt it is a clever approach where everyone wins. As a young company we were attracted by the low CAPEX model that saves us in hardware, footprint and licensing, both initially and as we grow. We also looked at it from our customers perspective and felt it was a benefit to have Seagate/i365 involved to add comfort and reassurance that their data was in safe hands and shows Xanadu is acting responsibly towards customer valuable data.
Xanadu services customers large and small, direct and through our own VAR’s offering a portfolio of services with data backup entwined as part of a package. We also pride ourselves in how we wrap and look after our customers and so we do not feel threatened by i365 holding our customers data, in fact they did give us the option to replicate to our DR site, but we felt benefits of replicating to i365 enhanced our proposition.
The reality is that once this model becomes common knowledge, it will quickly grow and it will not be logistically possible for the Seagate/i365 to grow in emea any other way regardless of holding customer data.
We are happy with our choice and financially it was not such a barrier to entry.
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