Resellers 'must resist cloud's race to the bottom'

Cloud distie intY has expressed concern that continued cloud market consolidation and domination by the bigger vendors will result in channel players being forced to compete on price alone, offering less value to end users.

“There is a real risk that in 2018, as the cloud market consolidates and Google, Amazon and Microsoft continue to assert their dominance, resellers will come into the market and lower their prices to the point where they completely undercut their competitors," said Craig Joseph, COO at intY.

"We know that the IT reseller market is competitive, but our concern is that the resellers that sell on price alone will not offer the service levels required to support customers as they transition to the cloud. This may include neglecting after-sales assistance and technical support."

But there are factors at play that could prevent the worst from happening. Indeed, Microsoft may have stolen some of AWS's market share in 2017, but analysts think Azure popularity will start waning in 2018. Microsoft has already said it wants to take AI more seriously, so could it start to focus more on that than core cloud services?

The channel needs to start shifting the way cloud products and services are sold, using its privileged position to promote the benefits of great customer service to ensure firms remain competitive.

"Customers are of course price-conscious, so if resellers start selling cheap and ignore dedicated customer services, it may become increasingly challenging for those who prioritise top-quality customer support to compete," Joseph added.

"Resellers must ensure that their customers understand the value of good customer service and build it into their proposition, as focusing on customer service can reap dividends in repeat business and further business development.”