Partners Look to Make Money Amid Vendor AI Fanfare

Vendors are notorious for the hype they place on AI. One analyst says "partners shouldn't believe it."

Moshe Beauford, Contributing Editor

July 9, 2024

3 Min Read
Vendor AI hype: Where's the money for the channel?

Artificial intelligence (AI)-fueled tools present plenty of prospects in the channel, but partners should approach the deluge of messaging from vendors with caution.

David Smith, founder and principal of InFlow Analysis, tells Channel Futures that no one, aside from a few vendors such as Microsoft that charge for its Copilot offer, is directly making money on AI. Many other unified communications and collaboration vendors give theirAI away for free.

The channel, says Smith, can add value to an otherwise free offer on which vendors often promise and underdeliver.

"The truth is, nobody is selling AI itself, so partners in the UC landscape have to get creative around the services [they] can wrap around AI, meaning the channel will have to become experts in niche markets like health care, education, etc." Smith told Channel Futures.

InFlow Analysis' David Smith

The other end of the spectrum is blind trust. By that, Smith points out that vendors often promise high levels of accuracy from their AI platforms.

Yet the proof is usually in the pudding and often gets laced with inaccuracies in meeting transcripts and beyond. Marketing materials say one thing, while the reality is another — a more stark contrast to what customers experience without the aid of a trusted advisor to help make that AI journey less frictionless.

Related:Don't Get Lost in The Generative AI Hype

"You can't trust something that is only 99% accurate, because in an area like financial services, there is no room for error," Smith said. "Partners need to get creative to make money on AI."

According to Smith, there is no direct revenue opportunity, so data management and ongoing security management are two primary components of the AI pie from which partners can make money via artificial intelligence.

Vendor AI Hype Surrounding AI Has Channel Starry-Eyed

Despite the lack of direct revenue, Smith says if partners don't find a way to work AI into their portfolios, they risk becoming yesterday's news.

"Partners have to be in the AI game because it is becoming an animal. Vendors are already doing AI, but what can a channel partner do to add value to AI?" Smith said, maintaining that's the real question.

Moving forward, this will remain a "big challenge," Smith said, remarking that the stakes are far too high to sit on the sidelines.

"In some ways, some of the tools vendors have introduced have reduced the need for partners, Smith shared.

Even mergers and acquisition expert Tim Mueller acknowledged that becoming an AI expert, especially in Copilot, would be to a partner's benefit, sharing in a LinkedIn post that it can help enhance productivity, improve collaboration and empower employees, which can be on the partner side or for the partner's customer.

IT ExchangeNet's Tim Mueller

Mueller does not, however, mention how partners will make direct revenue on AI, yet writes in the same post, "The true value of Copilot lies in its ability to transform how clients work. By mastering Copilot, you can help them achieve significant benefits."

Meuller then cites the $100 million dollar channel partner opportunity, which still appears to be tied directly to the partner and how creative they can get with enhancing out-of-the-box AI functionalities vendors tout as highly accurate.

Leveraging AI to Sell Your Microsoft Consultancy

Another area where AI could make channel partners big bucks is in the world of mergers and acquisitions, Mueller notes.

He believes becoming an expert on tools like Copilot, if you have a Microsoft consultancy, will only play to your company's strengths and could lead to a more successful exit.

Regarding selling your Microsoft practice, potential acquirers look for more than just a customer base.

"They're seeking partners who understand the future of work and can unlock the value proposition of Copilot for their clients," Mueller penned.

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About the Author(s)

Moshe Beauford

Contributing Editor, Channel Futures

Moshe has nearly a decade of expertise reporting on enterprise technology. Within that world, he covers breaking news, artificial intelligence, contact center, unified communications, collaboration, cloud adoption (digital transformation), user/customer experience, hardware/software, etc.

As a contributing editor at Channel Futures, Moshe covers unified communications/collaboration from a channel angle. He formerly served as senior editor at GetVoIP News and as a tech reporter at UC/CX Today.

Moshe also has contributed to Unleash, Workspace-Connect, Paste Magazine, Claims Magazine, Property Casualty 360, the Independent, Gizmodo UK, and ‘CBD Intel.’ In addition to reporting, he spends time DJing electronic music and playing the violin. He resides in Mexico.

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