Causing A Ruckus In The WLAN Channel2:00 PM EST Fri. Dec. 10, 2010
It doesn't have the name recognition of its biggest competitors, nor the breadth of channel partners and resources. It's in one of the most competitive markets within the broader networking segment -- wireless LAN -- that's getting more crowded all the time. And there are plenty of observers who are encouraged by its IPO aspirations but still believe the company's going to be acquired before that day comes.
But darn if it isn't a great time to be a Ruckus Wireless solution provider. Products, margins, quirks and all -- the company has become one of the WLAN channel's hottest plays in the past two years, and it's getting stronger still.
"We sell two or three different wireless technologies, and the way we've been handled by Ruckus is superior to how we've been handled in the past," said Dave Casey, principal at Westron, Carrollton, Texas. "They help us drive business, define business and get creative about the ways to differentiate the product. It's been a good thing for us: They're a combination of the technical and the personal."
"What gets me here is the passion," said Pat Grillo, president and CEO of Atrion Communications Resources, Branchburg, N.J. "It took them a year-plus of meeting with me and getting me to move away from my previous wireless vendor, but what made it easy was meeting Selina [Lo, Ruckus' president and CEO] and the team and the excitement they bring. Then when their technical people came in to meet with our technical people, my people told me that this was so much better than what we were working with."
Tim Hebert, president and CEO of Atrion Networking, Warwick, R.I., added Ruckus earlier this year. Though primarily a Cisco shop, the value Ruckus products could present to certain customers proved too compelling to ignore, he said.
"This is a very crowded space, and everyone says a lot of the same things, and what excited me about Ruckus was the passion and energy they brought," said Hebert. "We deal prominently with Cisco, and Cisco is big and wireless is a priority for them but a small market overall, so it doesn't get the same attention and energy you get from someone like Ruckus, where it’s a primary business."
Ruckus' major WLAN competitors, which include market leader Cisco, Aruba Networks, Meru Networks and a slew of others, have taken notice, not least for the fact that both IDC and Gartner have at various points in the past year named it the fastest-growing company in the space. According to Gartner, which in March 2010 ranked Ruckus No. 8 in the space, it was the largest gainer of share since 2009, with 105.8 percent gain year-over-year. In CRN's Annual Report Card (ARC), Ruckus' impressive showing in the SMB Networking Hardware category put it within spitting distance of category toppers Cisco and Adtran in nearly every criterion, and ahead of longer-established players like D-Link, Hewlett-Packard and Netgear.
Revenue gains also tell the story. Ruckus in 2009 grew to $56 million in product shipments, a 100 percent gain from 2008 -- and had hit that mark and passed it by the third quarter of 2010, expecting to post another year of volcanic growth.
So how did it get there? And why has Ruckus struck such a channel chord?
Next: The Bark And The Bite
The Bark And The Bite
CRN had an opportunity to visit with Ruckus' top executives and some of its top partners as an exclusive media attendee at the Ruckus Big Dogs partner conference in October.
More than dozens of interviews over two days in Atlanta yielded excitement, engagement and anticipation -- for Ruckus to make its leap into the big time, for the fact that its gains have been so consistent over the past two years especially, for the idea that its bark -- its mascot is a barking dog, after all -- has been even louder than the noise and tumult that have made the hypercompetitive WLAN space something of an echo chamber.
First, it's a strong product. Ruckus has pushed a great story, VARs say, behind beam-forming, the method of radio frequency transmission that, when incorporated into wireless access points (APs), can up client signal transmission and, therefore, throughput, by focusing RF energy directly at Wi-Fi clients. Its ZoneFlex line came to life as primarily an SMB play, but Ruckus in early 2009 began to expand its focus to midmarket and enterprise deployments, too.
The combination of its products’ technical prowess and their price points, which come in well below most competitors, make them easy to sell, provided they get a chance to strut their stuff.
"As the technical anchor of our business, I'm time to time called in to help the sales team when there's an opportunity, it's late in the game, and the pitch is in the dirt," said Brian Young, CTO at Convergence Technologies Inc., Burr Ridge, Ill. "They've made up their mind already, and then we get their attention with how beam-forming works -- forget the flashy marketing material, we map it out for them using a pencil and circles -- and the physical difference with what Ruckus does. That gets them. We've been a Ruckus partner for three years and done huge market installations outside of our turf because of the references we've had."
Nearly all of the interviewers said they were comfortable not only selling, but also leading, with Ruckus products, and those who didn't said it depended largely on the situation. Ruckus has a stronghold, for example, among hospitality customers, but it is still breaking into WLAN-interested verticals such as health care, where rivals like Cisco and Aruba dominate.
Its vertical strengths, however, have allowed several VARs to craft entire practices around those niche markets. Gary Patrick, owner of Hotel Internet Services, Palm Harbor, Fla., noted that many hotels average one AP per eight to 12 rooms, but Ruckus' coverage is as strong as one in 20 -- for less investment per AP.
"Wireless is as important there as having the lights on, or the phone or any other thing working in the room," Patrick said of the hospitality space. "So for them it's a very important investment. Ruckus comes in at an excellent price point, but there's lots of cheap equipment out there. It has to work, too, and customers have to see it working. We know it's working because they don't complain. And we've built up tons of references of people who can attest to the fact that the stuff is really good. I can think of one client [for whom] we've ripped out Cisco in all of their properties, put in half the equipment, and they're blown away by it."
Many solution providers say Ruckus’ lack of wider name recognition can be a hindrance. But it allows VARs to be trusted consultants because, without the name recognition of a Cisco or an Aruba, Ruckus products require demonstration to get over the goal line.
"It's a high touch-sale. The team has to go in and demonstrate, really bring in the customer, and convince them," said Gary Berzack, CTO and COO of New York-based eTribeca. "I love telling the story and I love selling it. I want to have less effort to sell Ruckus, and I'm not seeing that in all the verticals. Where I think we've got to increase is that mindshare so it's not as difficult."
When discussing the day-to-day machinery of its programs and its marketing support -- that nebulously defined channel saw known as "air cover" -- the word partners most often used for Ruckus is "nimble."
"Their air cover is 10 out of 10," Berzack said. "We have a simplified product set. We're selling wireless, we're not selling laptops and a lot of complicated, interoperable things here. When you do that, it makes it easier for them to get their message and communication across. A lot of the FUD has been taken out of both the marketing and the deployment."
Trinh Pham, chief marketing officer and vice president of sales at OCx Networks, a Denver-based solution provider, said that not only did Ruckus find a spot in the market on price, but it also saw, and nurtured, a class of channel partners that weren't always seeing support from their incumbent wireless vendors.
"The VAR community and the profit margins out there are really being squeezed," Phan said. "When you have 12 different Cisco VARs in your market, the margins are going to be squeezed. But when you have a unique name and are one of the few selling it, you can differentiate yourself. The ease of doing business with Ruckus is a phone call, which you don't always see. When the industry was younger, the [vendors] wanted the VARs -- they treated you really importantly. But now they're going after all the carriers, the big boys, and VARs don't matter to them. I think Ruckus sees that, which is why their VARs are recognized and close some of the larger deals."
BACKTALK: Reach out to Chad Berndtson via e-mail at email@example.com.