Dennis, I can tell you that having spoken to one of the largest cloud providers about this matter, that they are very concerned with "how will VARs make money" selling or reselling cloud OEM products. You are right that the cloud model moves money from the up-front implementation to a recurring revenue stream.
My gut tells me that long term it can be profitable, and it certainly is an easier business to manage (VARs of cloud service providers can see their cash flow a year or more in advance, vs. the project-to-project orientation of traditional VARs). But going from one model to the other will be difficult. Just like it's difficult for a traditional on-premise vendor to transition to cloud offerings.
So, I think the green-field pure play cloud VARs are going to have an easier time that traditional VARs trying to make the transition.
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