1. What's the Red Hat strategy?
In IBM's Q3 results yesterday, Red Hat's 19 per cent rise in normalised revenue to $371m was a ray of light in the vendor's otherwise dreary financials.
However, at IBM Think London, several partners told us they are still very much in the dark on what IBM's mammoth $34bn acquisition of open source giant Red Hat means for both IBM and Red Hat partners.
However, SCC's IBM sales manager, Richard Potts, said that he welcomes IBM not fully integrating its latest buy.
"I've been really surprised - really surprised - having used to work for IBM in the past, that they've not tried to Blue wash Red Hat. It's refreshing," he said.
"We've been a Red Hat partner and IBM partner for a long time and I thought that was the big risk. IBM has a culture that's very different to Red Hat.
"What customers are looking for, and it doesn't matter what buzzword you use - multi-cloud or hybrid-cloud - is to modernise applications and be able to move them across whatever environments they work with."
The chief sales officer of MSP CSI, Scotty Morgan, said that in a recent meeting with clients he was "not able to give many answers" on IBM's Red Hat strategy.
"I'm not going to sit here and say I have all the answers because it's brand new. These guys have only been in bed for 10 weeks. We literally just had a session with our clients three or four weeks ago in the Shard and that was the first time the proposition was presented."
"My biggest question I have for IBM is: how do we make money with this? How do we take what IBM is putting together [with Red Hat] and incorporate that into our proposition?
Morgan said he's put these questions to IBM. So, what was IBM's response?
"We'll, they're in the process of truly understanding this themselves," he said.
2. Will there be more ESA marketing investment?
IBM VP partner ecosystem Paul Brown said that IBM is focusing on helping partners to build solutions to take to market, pointing specifically to IBM Embedded Solution Agreements (ESAs).
"It's about co-creation with partners," he said.
Brought in two years ago, Brown said it's his goal with ESAs is to make it "hard to see where IBM ends and IBM partners begin".
"We now have 600 separate ESAs. And we have roughly 100 active in each quarter. They've grown to a level where now a third of our transacted revenues are derived through partner ESAs. And we're looking to double that."
He added: "The incentives for ESAs are natural in that there is more margin than just resell, by definition, as there's more of their IP. But we're also investing in marketing their ESAs."
Several partners said they would welcome much more of that additional ESA marketing spend.
SCC's Potts highlighted ESAs as one of the more promising partner sale models IBM has ever presented to partners.
"The ESA's are where we buy the software and then provide a service built on that software. And that's a model they didn't have before. It's definitely transforming the way we go to market," he said.
"And I see that model expanding rapidly, but not at the expense of traditional transacting business. We're interested in seeing where IBM takes this."
3. Will IBM cough up more to help partners invest in emerging technologies?
IBM's executive team are at pains to point to its investments in emerging technologies in cloud and open source.
CPI asked one of its longest standing partners, reseller Meridian IT, what it makes of IBM's attempts to transform itself.
Meridian is a platinum global partner with IBM, having resold IBM power flash storage for 20 years.
It's now diversified into creating its own IP and offering other services.
The view from its UK MD Steve Young is that IBM needs to consider even older, established partners as "developing businesses" if it wants to incentivise more to invest in IBM's emerging tech.
"The biggest incentive from IBM to us is development funding, because we're in development," he said.
"We're not ashamed to put our hand in their pocket. We've got money in the bank but we want to scale."
Young highlighted IBM's AI vision product as an area Meridian IT sees significant potential in.
"It has a hugely expensive capital licence cost. But we've negotiated a subscription model where we can take that into smaller start-up businesses with the help of IBM.
"So, the incentives have got to be around helping us develop the business, mainly with cash, but also lead generation and aggressive marketing with IBM.
"You know, if they can afford $34bn to buy a company, I think they can send a few shekels our way to help us grow their developing business."
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