Red Hat's Enzweiler stressed that Egan's departure does not change the company's channel strategy.
"The strategy is not changing," said Enzweiler. "While [Egan's departure] is inconvenient with the partner conference, I actually view it as if there is a time for this to happen, it's a good time because now we can go have those conversations with all those partners within a week of when Roger left the company. I think that will minimize some of the disruption."
One sign of Red Hat's continued channel commitment, Enzweiler said, is changes that will be announced at next week's partner conference focused on additional margin and sales opportunity around Red Hat renewals. "We are going to do some things around renewals that will give partners additional margin opportunity and protection," he said. "We are obviously going to want them to be responsible for making sure they optimize around the annuity model."
What's more, Enzweiler assured, partners will see strong commitment from Red Hat CEO Jim Whitehurst.
Another sign of Red Hat's channel momentum: a steady uptick in net new customer business being brought to Red Hat by solution providers, said Enzweiler. "That is an indicator of future performance and margins for the partners," he said. "Obviously getting the renewal costs less than it does to get the first transaction."
Enzweiler acknowledged that some partners will likely be concerned about Egan's departure. He said he is focused on reassuring them that the company's channel commitment remains strong. His message to partners: "Don't be concerned. There is a lot of good news. There is a lot of momentum. The commitment they are going to get from Red Hat is pretty clear. We are going to continue what got us here. We were, way back, a direct-centric company. We have steadily made improvements in terms of percentage of sales going indirect. We want to drive this business to 70 percent channel."
James Chinn, CEO of Shadow-Soft, an Atlanta-based open-source software developer and channel partner of Red Hat, said he was a little shocked and worried about the departure of Egan. "Egan is leaving quite a legacy," Chinn said. "I'm worried about who will step into his shoes."
Red Hat product sales account for nearly half of Shadow-Soft's revenue, or well over half if services are included, Chinn said. In the five years that Shadow-Soft worked with Red Hat, the company's business with the vendor doubled every year except the last, when business still grew 50 percent.
"How Red Hat reacts is important to us," he said. "Do they go back in time to a more direct focus or carry on with Egan's vision?"
Egan will be missed in a big way, Chinn said. "He definitely has some big shoes to fill," he said. "We hope that whoever steps into that role continues his legacy. Red Hat now has the best channel program we deal with."
PUBLISHED JAN. 6, 2013