Conflicts Between IT Vendors, Channel Partners on the Rise

DOWNERS GROVE, Ill.,  Challenging economic times, new technologies and new methods for selling information technology (IT) solutions have contributed to an increase in conflicts between vendors and their channel partners, according to a new study released today by CompTIA, the non-profit association for th­e IT industry.

Six in 10 IT channel companies say the incidence of conflict has increased in the last two years. Eight in 10 say
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conflict has affected their business negatively, including 21 percent that described the impact as “major.” The findings are included in CompTIA’s Third Annual State of the Channel Study: Channel Conflict and Deal Registration Trends.

“Conflict between IT vendors and their channel partners is not a new issue, but it’s a dynamic that ebbs and flows,” said Carolyn April, director, industry analysis, CompTIA. “Right now, the channel is roiling for many firms.”

The report also includes encouraging news. A significant number of channel firms are responding to conflict by reinventing their business.

“They’re looking inside their own organizations to get their own house in order to become more appealing to the customer,” April explained. “They’re improving their own service capabilities, specializing in vertical markets and making the move to a managed services business model, which cements them to a customer.”

April cited three factors that have contributed to the rise in channel conflict.

  • A poor economy, which drove a number of technology vendors to focus more on direct sales to customers at the expense of their channel partners.
  • New methods for reaching customers with technology services, such as cloud computing.
  • New entrants into the market, such as telecom companies that now offer IT services in additional to their traditional voice services.

The result has been lost business for many channel firms. More than three-quarters said they lost one or more deals in the last 12 months due to channel conflict.

The study is the result of an online survey of 350 U.S. IT company executives conducted in February 2013. Additionally, a series of in-depth interviews with IT channel executives at a cross-section of Fortune 500 and mid-tier technology vendors were conducted in February and March 2013. The complete study is available at no cost to CompTIA members who can access the report at www.CompTIA.org or by contacting research@comptia.org.


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