Beware Behemoths

So, naturally, when Everything Channel senior editor Joseph Kovar reported last week on the story of a Southern California solution provider suing Cisco Systems for breach of contract, my gut told me the case probably had merit. After all, why would a $5 million VAR go after a multibillion-dollar titan if it had any reason to believe its case wasn't solid?

In this particular case, Infra-Comm, a San Juan Capistrano, Calif.-based Cisco partner, alleges Cisco handed a major deal it developed and sold over to AT&T—even after Infra-Comm filed the project in Cisco's deal registration program.

Infra-Comm president Luke Hosinski further charges that Cisco dumped his company as a partner after he filed a lawsuit about the deal he claims went to AT&T.

The Infra-Comm/Cisco relationship goes back to 1999, and Infra-Comm has based many of its biggest sales wins around Cisco's IP telephony line, with several clients in the $400 million-plus revenue range. Cisco gave Infra-Comm the West Coast Commercial Ops Top Channel Partner "Trail Blazer" award in 2005 and certified Hosinski's company as a silver-level partner in 2007.

But these days, because Infra-Comm was a Cisco-exclusive solution provider, the breaking of the relationship has left Infra-Comm a devastated company, with Hosinski facing the prospect of rebuilding his company from scratch.

Infra-Comm is not the first company to charge that Cisco handed a big project it landed off to AT&T or another of its largest partners. And it's not the first partner Cisco has dumped. So, it is entirely possible that Hosinski's charges are completely true. It's also possible that the charges are true and that legally, Cisco still did nothing wrong.

It's not an open and shut case. But none of that matters.

What matters is that Infra-Comm's story is a cautionary tale for all solution providers. While some solution providers say the lesson to be learned here is don't bite the hand that feeds you by suing the vendor you built your business on, I choose to take it a little further.

Don't build your business on one vendor. I have had this argument before. And yes, there are lots of profitable solution provider businesses out there based on one vendor. But are they solid? If one company's actions can take you down, then you haven't built a solid, sustainable business.

When it comes to vendors, are you exclusive? Let me know at [email protected].