Division to deliver more services to VARs
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Arrow Electronics' North American Computer Products Group is betting heavily on storage.
In the past, Arrow built the group mainly through acquisitions, but in the past several months, the distributor has invested millions of dollars in building a separate storage division from the inside out.
To bolster its storage offerings, Arrow this month dedicated 90 technicians to help VARs choose, design, integrate and implement multivendor storage solutions.
"We've designed the division to deliver more services to VARs to help them win and execute the larger, more complex deals they're not able to do on their own," said Lance Sedlak, director of marketing at Arrow's enterprise storage solutions division.
Arrow is pricing the engineering services at a flat rate or based on travel, time and materials. The services will be competitively priced, allowing solution providers to resell them at a profit, said Kevin Schoonover, director of engineering at Arrow's enterprise group.
He said the engineers are a mix of Arrow employees and outside consultants who are under strict non-disclosure and noncompete contracts to protect solution providers.
The unveiling of Arrow's new engineering services coincided with the opening of its second storage solutions lab. The 5,000-square-foot facility opened last week in Minneapolis, two months after the distributor opened a similar lab in Atlanta.
Both labs feature storage products by a variety of vendors, including Compaq Computer, Crossroads, EMC, Exabyte, Hewlett-Packard, Hitachi Data Systems, IBM and Veritas Software. Also, they're staffed with engineers to help VARs and integrators create and test solutions based on business continuity and disaster recovery; centralized management; data migration; high availability; and SAN interoperability, security and server consolidation.
Steve Johnson, senior vice president and general manager of edeltacom, Atlanta, has visited the lab there and has used Arrow's engineering services for systems design and pre- and post-sales support.
"Those services allowed us to stay engaged in a lot of opportunities that we wouldn't have had," Johnson said. "We also used them a lot on post-sales calls. It makes the customer feel good because they see not only that we're there to serve them but that representatives from the top vendors are there, too."
Johnson said edeltacom is starting to see more interest from large and midsize businesses in high-end storage solutions, despite the economy. Recently, the company sold a complex SAN solution to a large health-care group and has a few similar rollouts in the pipeline, he said.
"We're still not seeing corporate America spending a lot," Johnson said. "Some customers have held off, but people are starting to talk about leveraging these solutions."
Sedlak and Schoonover agree: Fortune 1000 companies will continue to invest in storage, particularly in management solutions, as their needs increase.
Gartner Dataquest predicts the hardware storage market will decrease to about $7.2 billion in 2005 from $7.7 billion this year, but more than 90 percent of those sales will go through indirect channels.
On the other hand, the entire services market is expected to skyrocket to $395 billion in 2005 from $276 billion this year, with more than 70 percent going through the indirect channel, Gartner said.
"Arrow has a corporate strategy of investing during down markets, and we've made a significant investment in the storage area," Sedlak said. "This is the single largest investment, outside of acquisitions, that this group has made."