10 Best-Seller Takeaways

The channel hasn't seen a year like 2008 in a long time, a 12-month period that began so strong and ended so wrong, at least economically, for most vendors and solution providers. It was also a year of change for many vendors, according to CRN's Best-Sellers research, which aggregates product sales through distribution, as compiled by The NPD Group.

Here are 10 Best-Sellers takeaways that illustrate how much the market can change, and stay the same.

Lexmark Gains Ground In MFP Market

In multifunction printers, Lexmark grabbed some share away from rival Hewlett-Packard. Its share increased from 14.8 percent of sales in 2007 to 20.5 percent last year. While Lexmark still trailed HP by a wide margin, it can take solace in the fact that HP's share fell to 49.6 percent from 54.3 percent. "I think it comes down to price, performance and flexibility," said Fred Heins of Technology Integration Group, Wayne, Pa. "Some of Lexmark's products are in the same league as HP's. But Lexmark costs less so you're getting more bang for your buck."

Panasonic Gains On NEC, Samsung

Panasonic made significant strides in the large LCD display (30 inches or more) category in 2008. The company now accounts for 19.2 percent share, up from 12.1 percent in 2007. While Panasonic joined a long list of companies from Asia also affected by the downturn in electronic sales, its market-share increase can be attributed to Panasonic's heavy investment in developing LCD technology, said David Barnes, vice president of strategic analysis at DisplaySearch. "Panasonic advanced technology relative to other makers, giving them a greater value-add," he said. "Other companies are not adding capacity."

Interestingly, the top five companies in the 2009 Best-Sellers listing also saw share gains last year, including market leader NEC Display Solutions. That could be due in large part to the departure of Pioneer, which saw its share plummet from 12.5 percent in 2007 to just 1.8 percent last year. Pioneer is basically exiting the LCD and plasma markets to focus on audio, Barnes said.

D-Link Takes Big Bite Out Of SMB Wireless Routers

Our 2008 State of Technology: Networking study suggested solution providers were seeing huge opportunities in wireless for small and midsize businesses, that 802.11n was catalyzing those opportunities, and that D-Link was among the most notable vendors for wireless solutions. Fast forward a few months and D-Link's share of sales of SMB wireless routers through distributors more than doubled in 2008. Cisco's Linksys Group remains the best-selling brand of wireless routers to SMB through distribution, but D-Link's dollar volume share went from 7.7 percent in 2007 to 15.9 percent last year.

Symantec's Suite Focus Pays Off

Whether it was foresight or a lot of luck, Symantec has jetted to the front of the market curve by emphasizing its security suites. Symantec's share of security suite sales was 58.8 percent of sales through distributors in 2008, up from 45.5 percent in 2007. Partners say that Symantec's move to consolidate its product lines provides a can't-ignore option.

"It's more and more cost-effective for organizations to partner with just a few security vendors to achieve their holistic security solutions," said David Sockol, president of Emagined Security, Santa Clara, Calif. "The cost associated with running an individual product line one at a time is becoming outrageous."

HP's Breadth Of Success HP's far-ranging product line ensures that a wide variety of VARs carry its products. So it's not surprising that it was a dominant player in the Best-Sellers results, too. HP had the top market share in four product categories: desktops, notebooks, multifunction printers and color laser printers. In addition, HP was second in blade servers, 19- to 30-inch color LCD displays, document scanners and NAS devices.

"HP is just a phenomenal company from top to bottom. I can't think of a better partner across the board to work with on a day-to-day basis," said Todd Barrett, director of sales for the security and networking division of CPU Sales and Service, Waltham, Mass.

Cisco's Mighty Share

Cisco might be one company that could rival HP's dominance in the channel, but in a different way. While Cisco might not have the reach across more product lines than HP, its share in those categories was truly remarkable. In 2008, Cisco had the most market share through distributors in network security hardware and SMB routers, SMB wireless routers, and was even more impressive than HP in the amount of share it had.

In network security hardware, Cisco accounted for 43.6 percent of all dollars sold through distributors last year, while also accounting for 69.5 percent of SMB routers and 56.1 percent of SMB wireless routers (the latter two including Linksys Group sales).

Greg Starr, COO of IT Works, a New Boston, Texas-based solution provider, said Cisco has positioned itself quite well in the market through strong acquisitions and solid technology. "They're a very stable company; they're money in the bank. It gives people confidence in times like these," Starr said.

Smaller Vendors Are On The Rise

While the Best-Sellers data is dominated by the HPs, Ciscos, APCs and Samsungs of the world, there are other, less-mentioned vendors with impressive share changes year-over-year. For example, Cyber Power Systems saw its share in UPSes jump from 0.9 to 1.4, a 55 percent gain. Planar Systems' share in the 19- to 30-inch LCD display category increased 56 percent, to 2.5 percent of the total market.

Elsewhere, Verbatim grabbed 1.9 percent of the external disk drive share sales through distribution, up from 0.1 percent in 2007. Asustek garnered an eye-opening 520 percent increase in its share of the notebook market, from 0.5 percent of revenue to 3.1 percent last year.

Fujitsu's Got The Scanner Market Covered

In the document scanner category, Fujitsu widened its market-share lead over competitors like HP, Canon, Kodak and Visioneer. Its dollar volume share of sales through distributors for 2008 was 45.5 percent, up from 41.4 percent in 2007. It gained share from its two nearest competitors, HP and Canon. Kodak was the only other company among the top seven market leaders to increase its share, from 5.3 percent to 5.7 percent last year.

Lenovo Solid, But Took A Dip

Lenovo was a solid No. 2 in terms of the share of desktop and notebook revenue sold through distribution last year, but the company lost ground to competitors in the process. Lenovo's share of 2008 desktop dollars sold through distributors was 20.6 percent of the total market, down from 24.0 percent in 2007. The company's notebook decline was even sharper. Lenovo accounted for 21.9 percent of all notebooks in 2008, down from 26.2 percent the previous year.

Lori Koch, director of marketing at CBE Technologies, Andover, Mass., said Lenovo's decrease may have more to do with HP's increased penetration into the education and government markets and that company's strategy to go after Apple. "Even though they were competing against Apple, I think they knocked Lenovo a little bit," she said. "[HP's] line of smaller notebooks is a huge play in schools and local governments. It obviously competes with [Lenovo's] ThinkPad. It's small but it still has the functionality people need."

Kaspersky On The Way Up

Among its recent achievements, Kaspersky Lab garnered a five-fold increase in e-mail security sales through distribution last year, up from 0.1 percent in 2007 to 0.6 percent last year. Partners say the strong quality of its technology has generated a buzz.

"They consistently have top placements in the comparatives, which make people feel better about a product they might not have known or heard of before," said Todd Leidner, vice president of operations for Norman, Okla.-based Intelek Technologies. "All these things combined are making people realize that Kaspersky offers security they can trust."