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A Typical Big Data Value-Added Reseller Business Model

March 16, 2017

A Typical Big Data Value-Added Reseller Business Model

Where is the added value in the value added reseller business model for big data? Traditionally, VARs have been responsible for optimizing the appliances that drive the data center – routing, servers, data storage, and so on. With the new technology demands of big data, the value added reseller business model has had to migrate from the data center to cloud services. That means moving away from hardware and into new areas such as software, services, and big data consulting. For VARs looking at big data as part of their value added reseller business model, they will have to change with the times.

In a recent interview with Forbes, Hayes Drumwright, founder and CEO of Trace3, noted that his reseller company had changed from a 2:1 sales to engineering ratio to a 5:1 ratio to support new big data service demands. He also notes that his hardware sales have boomed even as he has focused on supporting converged big data infrastructure, which he sees as a precursor to hybrid and public cloud.

Smart VARs are adding cloud, programming, and related services to their line card as part of big data. Wikibon projects 40 percent of big data revenue is made up of services including cloud, noting that “the continued evolution of cloud-based big data services for large-scale analytics and application development” is one of the primary drivers for big data adoption. Hardware makes up 38 percent and software 22 percent, but industry experts see more services and software evolving to support big data. The value added reseller business model is evolving to accommodate new demands.

New Big Data Market Drivers

Companies are moving to big data to manage operations as well as predictive analytics, which means new VAR opportunities. Cloud Times reports that only 29 percent of companies are using big data for predictive analytics, while 65 percent are using big data for equipment control and operations. A Gartner study also reports that 73 percent of companies are planning to adopt big data in the immediate future and 49 percent want to use big data to create new business opportunities while 60 percent believe big data will improve operations.

What’s going to drive big data analytics in the coming year are real-time analytics and the Internet of Things (IoT). Real-time data analytics now can handle unprecedented volumes of data to manage operations, including data security response. IoT data will take on more significance this year, delivering real-time machine data for big data analytics to manage everything from the factory floor to enterprise performance.

This means smart VARs are going to start looking at data center operations from a new perspective, with new monitoring and diagnostic tools powered by big data.

New Big Data VAR Alliances

Another trend is the increase in reseller agreements with big data vendors. Hortonworks, for example, has a strategic reseller program for its data platform, which includes integration with partners like HP, Microsoft, Rackspace, SAP, and Teradata. And big data providers like Datameer and Cloudera have a number of strategic partners, all offering Apache Hadoop support.

Chances are some of the vendors you work with today already have strategic alliances with big data software and service providers. These relationships provide an easy entry into big data software and services, since many vendors offer training as well as support.

Other vendors are creating vertical big data reseller programs to reach target markets. IBM, for example, has a growing list of integration partners, many of them specializing in sectors such as healthcare, retail, or financial services.

The New VAR Big Data Business Model

So what is the new value added reseller business model for big data? You can approach big data in a number of ways:

  • You can continue to work with your current partners and follow their lead, using their hardware, software, and training to open new doors for big data sales.
  • You can broaden your current consulting offering, expanding your expertise to take on more software development, cloud services, and consulting services. The more expertise you can offer in areas such as virtualization, data storage, real-time analytics, and other big data requirements the more value you can offer.
  • You can go vertical. The unique use cases and requirements of big data customers in various markets – retail, healthcare, government, manufacturing, financial services, etc. – require unique expertise. Combining your understanding of specific markets with big data software and services will help you build big data sales in the vertical market of your choice.

These are just some of the ways that forward-thinking resellers are adapting their business models to conquer big data. You can find your own big data success, and if you need assistance drawing the right roadmap, don’t hesitate to contact your Ingram Micro representative to see how we might help.