VARs React To Linksys Purchase


A spot survey of Cisco partners indicates they view the company's purchase of home networking provider Linksys Group as an opportunity to boost sales to the small-business customer.

The top maker of Internet traffic equipment on March 20 said it will pay roughly $500 million in stock for the opportunity to get up close and personal with consumers. Specifically, some of these partners see an opportunity to create a deeper impact in the hot IP telephony market.

"I think it's all positive for us. While [our] focus is midmarket, where the Cisco full-product portfolio competes well, the acquisition could allow us to have a more competitive offering in the small-business [arena]," says Robert Keblusek, vice president of business development for Downers Grove, Ill.-based Sentinel Technologies, which has been a Cisco VAR for more than eight years. "The more market segments we can appeal to with similar technology to complement our investment in training and resources, the better," he adds.

While it's true some partners consider the small-business market, well, small potatoes, they, nonetheless, believe there might be enough juice in the eventual amalgam to benefit them down the road.

"In the longer term, the capabilities that will be provided to the SOHO market will directly influence sales in the traditional corporate market [we serve]," says Ron Temske, director of converged technology solutions for US Logical, a Cisco Gold Partner. "IP telephony is a key focus area for both Cisco and Logical. A strong application of IP telephony is enabling access to the corporate phone system for remote and SOHO workers. [But] currently, the expense to provide such a solution has discouraged many organizations from pursuing this path."

Indeed, the consensus appears to be that Cisco R&D combined with the popular prices championed by Linksys will serve Cisco partners well. "Cisco's infusing the product with greater performance while keeping the price attractive to the small business and home owner will only improve the total Sentinel offering and value proposition to the end user," Keblusek says.

And while Chris Piecukonis, vice president of Western sales for Cisco partner Technology Integration Group, sees no immediate impact on Cisco channel partners, like Keblusek, he expects partners will benefit down the line. "The long-term benefits for the channel will be continued brand recognition from SMB customers who buy into these types of low-end product lines," he says. "They eventually grow and become bigger customers."

What remains largely unanswered in all the chatter about the acquisition is whether the new channel now opened to Cisco,the retail market,will ever present any real competition to its partners. After all, mass-market chains such as CompUSA and Circuit City have now become Cisco VARs in the blink of an eye. "Only time will tell if these channels begin to carry other Cisco products, or stick to the small SOHO-oriented product lines," Temske speculates.