GTIA
using AI bots behind the scenes? There are going to be a lot of hurdles and that is going to keep us in a hybrid business model for some time. “Another part of why hybrid is going to stay is you are always going to have customers that will need you to sell them products such as hardware-based infrastructure, and that’s a transaction.” Future Carolyn is confident about the channel’s future. “I’ve been in this channel business for quite some time, and I have sat in more conferences than I can count where a keynote speaker all pumped up on the stage told us that the demise of the channel is right around the corner,” she says. “When the cloud came along, it was like ‘we won’t need the channel anymore. We’re just going to do business directly with the vendors through the cloud’. Well, none of that has played out. My faith in the channel and its continued existence is strong.” She adds there is a bifurcation of the channel currently. “There are companies that would describe the channel as relevant and changing rapidly and those tend to be in high-growth mode. They’re embracing AI and new technologies, looking at new business models,” she says. “Then there is another half that describe the channel as relevant and healthy but stable. A lot of those tend to be smaller companies that continue to make money and grow at a minor pace, but enough for them. They’re often lifestyle businesses and they’re perfectly happy staying in the lane they are in. There’s nothing wrong with that type of business model and they continue to have a very viable business. “I’m bullish on the health of the channel and the future of the channel. But companies must be smart and can’t ignore things that are happening right now. AI is going to be important whether you’re a high growth company embracing it or one of those stable companies, you still need to account for AI.” n
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There are companies that would describe the channel as relevant and changing rapidly and those tend to be in high-growth mode. They’re embracing AI and new technologies, looking at new business models...
services as part of their business but also sell products in the traditional way, along with project work and consulting. “We used to talk about the hybrid business model as a transition, but it is the business model for most channel companies and for the foreseeable future.” Carolyn says it will be a long time until channel businesses move to a 100% outcomes-based revenue model. “It’s a complicated metric, getting paid on an outcome. It makes sense if the outcome was to increase your customer’s general revenue by X% based on some rollout of technology, or increase the success of a marketing campaign for your customers based on the use of AI in that marketing campaign. “But say the outcome you want is cost savings. You want to save a customer 30% on X with this project or this use of AI. Now, the customer then saved money. What’s the payment structure there? There are a lot of questions around that. Pricing models get complicated if you start to use agents to perform tasks as an MSP. Say all your level 1 support is done by agents instead of humans. Customers are used to paying prices that would support human payroll within your organisation. Agents are going to be a lot less expensive than human payroll. So how do you justify the current pricing structure that you have with your customers when they know that you’re
Then there is another half...
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