Tech Distributors Versus Telcos: Competing When They Should Be Collaborating

While working on my recently published report, The Cloud-Driven Evolution Of Asian Tech Distributors, the tech vendors and distributors I interviewed drew parallels between telcos and tech distributors, both of which sell cloud-based solutions. However, during further discussion, the friction and competitiveness between the two quickly became apparent. So why should they compete when they can exploit each other’s resources and pursue joint go-to-market initiatives? By partnering, each can focus on doing what it does best to meet customer needs.

Telcos’ reach, ready infrastructure and existing customer bases provide a solid cloud foundation:

  • Back-end infrastructure. Telcos’ robust network and data center infrastructure is critical to setting up and delivering cloud-based services swiftly and without massive additional investment. Moreover, their businesses are well-suited to annuity models.
  • An existing base of enterprise customers. Although telcos aren’t considered a strategic enterprise provider in most instances, their access to a large base of qualified enterprise accounts and existing relationships potentially provides a very good foundation for cloud solution sales.
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