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The VAR Becomes the VASP
By
Gary Audin
Some market analysts are predicting that up to 30%
of the VARs will be acquired or out of business in the near future.
Those VARs that do not embrace managed service offerings will be
the candidates for this market change. The Webopedia definition
of a Value Added Reseller, is an organization that “typically
loads applications or proprietary software onto computers and may
also incorporate third-party options to design a complete solution
for a client. This "value-added" system is often customized
for a specific application, but is sold to the VAR's customer base
under the original design manufacturer brand; with that manufacturer's
warranty, support, and license agreements. VARs may also resell
customized OEM equipment.
The Value Added Solutions Provider (VASP) is the successor to the
VAR. Henry Dewing, Senior Analyst at Forrester Research, defines
a VASP as “….more than a VAR and more than an integrator.
This is a customer-centric, relationship-based model that ensures
a close fit of new technology solutions with the customer’s
existing infrastructure and a solutions approach [rather than a
product approach] that minimizes network-management overhead”.
The increasing investments in acquisitions/mergers and by private
equity firms are a recognition that the VAR landscape is changing.
The VASP model is closer to the old TDM vendor model where the
vendor did more than sell and install equipment, according to Dave
Hart, CTO of the newly created Presidio Network Solutions. the combination
of Presidio Corporation, Presidio Networked Solutions, Inc. and
Solarcom Holdings, Inc. The combined organization has a footprint
from Texas to Maine and total revenue of $750 million with over
50% of the Fortune 500 as their customers. Presidio is a prime example
of a VASP company.
So what can the enterprise expect from the VASP? Dave Hart and
I had a long conversation about the impact of the VASP on the enterprise.
The VASP comes from the mature VAR environment, basing it's offerings
on the enterprises business model that will then drive the solutions.
This is more consultative rather than based on a sales model, helping
the customer with conflicts that may be created by the array of
solutions available. The VASP has to be forward-looking because
the VASP/customer relationship is not to install and leave, but
to evolve into an ongoing team of VASP and enterprise that solves
problems with continuously evolving technologies.
The staff of the VASP will continue to require certifications.
Certifications will also be the method for the enterprise to evaluate
the VASP capabilities. Because of this, the staff of the enterprise
will require fewer technology certifications. It will then become
more project-oriented and project management certifications will
be of greater value to the enterprise. Presidio believes this, and
has invested considerable effort in their own project management
staff conforming to ISO 20000 standards.
I believe that the VASP will have the following values to the enterprise:
- Strong financial capability
- National footprint, not just local support
- Staff familiar with multiple certifications
- The ability to take on large projects
- Influential connections to the vendor’s products that
they offer
The enterprise now needs to discuss the business future of their
present VARs. Will they be in business in two years? Are they acquiring/
merging with other VARs? Is their support expanding nationally in
the areas important to the enterprise? Just selling equipment and
installing software will not be enough for a VAR to be successful.
The VAR that does not evolve into a VASP will have a limited business
life.
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