Top Avaya VAR Realigning Business To Prep For Nortel Deal

That's definitely the case with Cross Telecom, a Bloomington, Minn.-based Avaya Platinum partner and Avaya's top U.S. solution provider, which is gradually reshaping its portfolio to focus intensely on telephony and the applications side of networking infrastructure.

Earlier this month, Cross Telecom sold the Cisco-centric networking piece of its portfolio to storage VAR Datalink for $2 million. The deal, finalized Oct. 1, also has Cross Telecom agreeing to buy a minimum of $1.8 million in networking products and services from Datalink over the next three years.

For Bob Coughlin, Cross Telecom's president and CEO, the deal is a win-win: Datalink builds out its networking portfolio beyond the storage specialty it's had for 20 years, and Cross Telecom is freed up to focus on growing its telephony strategy without completely divesting itself of networking infrastructure.

More to the point, Coughlin said, Cross Telecom will now seek to acquire or at least partner with solution providers that can help Cross Telecom gear up for a soon-to-be-combined Avaya-Nortel ecosystem.

"We're looking at scaling up in support of our customer base and our future customers on Nortel," Coughlin said in a recent Channelweb.com interview. "We had to look at two things: what do we invest in and where's our growth area? Datalink was in the same situation -- they needed that competency around Cisco. Let me be clear: Cross is not doing away with the networking practice, but we have a huge chance to grow what is already a very functioning piece of our business."

Cross Telecom is a Cisco Silver partner, and according to Coughlin, the only way to take that to the Gold level would be to focus on Cisco's unified communications portfolio or ramp up its own Cisco data center practice, "which isn't our competency."

"The sale of data products is less interesting -- it's kind of the plumbing, the backbone," added Dave Lover, Cross Telecom's CTO. "Where our expertise is is applications. This gives us the opportunity to let Datalink focus on the infrastructure and see partnership on the data center."

Coughlin and Lover confirmed they were on the hunt for acquisitions that would add to Cross' telephony base and help it gear up for Avaya-Nortel and capitalize on what it sees as golden opportunities around Aura, Avaya's new virtualized unified communications platform.

"We're in the process of talking with numerous parties about bringing a Nortel competency into the fold of Cross," Coughlin said. "With the capabilities of Aura, which plays right into this opportunity, we're seeing what the competency of the customer base will look like. We think there's a big opportunity for the pieces around Nortel to shore up our ability to help those customers with a migration path. National as we are already, there are other areas we can focus on growth -- there are a lot of benefits for regional players."

Both Coughlin and Lover were in attendance last week at Avaya's 2010 Americas Partner Conference in Nashville, Tenn., and said they were encouraged by Avaya Connect, the vendor's revamped global channel program.

"Being the biggest and best and most certified around Avaya, Cross is going to benefit. We've got the pieces of the puzzle, we're growing professional services across all geography, and we're excited about the evolution, as well as beginning to benefit from their channel shift," Coughlin said. "We've been at it for a long time, and seen leaders come and go, ebb and flow, and we think we've got a group of leaders over there that gets it."

One of the key benefits of Avaya Connect for a partner like Cross Telecom is the increased incentives for top-level partners, as well as the less cumbersome program structure Avaya hopes will mean less confusion -- and less channel conflict with its direct-sales force -- going forward.

"In the past, there wasn't a lot of extra benefit to being the largest and most certified," Lover said. "The 'top tier' comes in a lot of different flavors, but being aligned with them strategically on where the industry is going is going to be big. Aura is totally transforming what we think of as a PBX, and we're not selling PBXes anymore, but there's still a ton of PBX resellers out there because they sell a lot of these parts. You'll start to see people really get on board with the solution approach [Avaya's] taking."

Still, there's the question of the product road map -- that is, how Nortel's portfolio will integrate with Avaya's and how the channel will sell both sets of products going forward. Avaya executives are bullish that the Avaya acquisition of Nortel's enterprise unit will be approved by early December, but in the meantime, Avaya's VARs, top to bottom, are left to speculate.

"We've been talking to a lot of Nortel customers, and they're interested in Aura," Lover said. "A lot of the Nortel customers tend to be with products that tend not to be very feature-rich and application-rich. Nortel is a very inexpensive provider of simple dial-tones, so I'm curious how Avaya will integrate that -- they've never been the cheapest dial tone, you know? But they pride themselves on advanced feature sets. It'll be interesting especially to see what's going to happen on the SMB side."