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December 11, 2018
By now you have likely heard that eCommerce platform developer AppDirect purchased telecom master agent World Telecom Group (WTG). What you may not know are details of the strategic vision for the companies going forward and why it matters to you. Here’s what you need to know.
AppDirect bought WTG to extend the reach of its cloud monetization and management platform via a cadre of established app, cloud and telecom services resellers and agents. AppDirect told Channel Futures that it will merge WTG with NeoCloud, a company it previously purchased, and build out a part of the company known as AppSmart.
AppSmart is a cloud marketplace where agents, VARs and MSPs can quickly and easily evaluate, select and bundle apps for clients. It competes with similar offerings from other marketplaces.
With the acquisition of WTG, AppSmart adds an invaluable sales force with an almost unshakable influence on millions upon millions of end customers globally, which is a significant boost to AppSmart and AppDirect by way of extension.
“Our vision from the very beginning has been to make technology more accessible globally,” says AppDirect co-founder and co-CEO Daniel Saks. “When we started, our strategy was built around delivering technology through a channel of local trusted advisers.”
When it comes to telecom and digital services delivered via the cloud, that’s agents, MSPs, VARs, cloud consultants and more.
Over the past few years, a variety of companies have invested in various efforts to make it easier for ISVs and telecom service providers to sell their services through these local trusted advisers. In 2015, for example, Ingram Micro purchased the Odin service platform from Parallels Holdings. Then in May of this year, Ingram Micro introduced the CloudBlue commerce platform.
Other platforms where ISVs, independent technology consultants and even end customers can come together to select and deliver technology bundles in a nearly frictionless way include the Salesforce AppExchange and the SaaSMax Marketplace. While each has a different focus and go-to-market strategy, they are collectively reshaping how technology services will be sold and delivered.
“I am calling ‘marketplaces’ as one of the top 10 disruptive trends for 2019,” says Jay McBain, principal analyst of channels, partnerships and alliances at Forrester Research, Inc. While these marketplaces will reduce traditional resale opportunities in the channel, they are likely to create some significant downstream services opportunities for independent practitioners.
Right now, it’s not clear which type of marketplace will prevail. One owned by a platform developer? An ISV? A distributor? No one knows.
What AppDirect believes, is that its chances of making its cloud monetization and management platform an industry leader will be greatly enhanced by owning a well-connected and respected master agent with ties to a robust and reliable network of sales agents. Rather than shoot for the moon and hook up with a traditional distribution company such as Ingram Micro, Synnex or Tech Data, AppDirect opted to go with a smaller master agent with longstanding ties to downstream consultants who sell tech services not as one-time transactions but for monthly recurring revenue instead.
To those in the master agent community, the AppDirect-WTG deal is yet another endorsement of their way of doing business.
“The IT industry is accelerating its pace of adoption of the channel, with more and more companies [leveraging] agency models instead of traditional distribution CAPEX or resell models,” says Drew Lydecker, president and co-founder of Chicago-based WTG rival Avant Communications. “The agency model is powered by master agents like Avant, which has, in fact, helped many legacy providers …
… transition from legacy distribution to monthly-recurring revenue (MRR) agency models.”
While online marketplaces could theoretically compete with individual agents for customer revenue, many partners, including Angie Tocco, co-founder of LanYap Networks, are excited about the prospects of working more closely with them.
“The enablement of better tools is becoming increasingly important to agents as we look for ways to more efficiently interact with our customers,” says Tocco. “I think this move is the wave of our future.”
It’s also vital for AppDirect, which unveiled its “multidimensional commerce” strategy at its annual Engage customer and partner conference in San Francisco this October. The multi-dimensional commerce strategy is built upon an audacious vision: Help any business of any size sell any product or service through any channel from any smart device anywhere. After almost 10 years in development, the platform required to deliver on that promise is largely done. But now AppDirect needs partners and products to deliver on that vision.
“What we are doing with WTG and NeoCloud under the brand AppSmart is really building out a network of resellers to access more businesses around the world,” says Saks.
Senior Director of Content, Informa
T.C. Doyle, is the Senior Content Director of Channel brands at Channel Futures, and is responsible for the editorial direction of channelfutures.com. A veteran technology writer, editor and video storyteller who has covered the IT industry for more than two decades, he was previously the Executive Editor at Channel Partners, and the Editor@Large with Cisco, where he traveled the world in search of stories that captured the social and technological transformations occurring in the economies of Africa, Latin America, the Middle East and Eastern Europe. A frequent speaker at IT industry events and trade shows, he resides in Park City, Utah.
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