Adapting To Channel Economics

IBM and Intel recently decided to license, free of charge, a significant amount of the technology behind blade servers, one of the hottest technologies in today's market. Rather than focus on developing a proprietary blade server, IBM decided to push the market faster.

The decision to focus on market expansion is a wise one. Proprietary systems are holding less and less sway; witness the rise of white-box systems in the market.

In the new era of the multivendor, solutions-based channel model, standardization is fast becoming the rule as the channel looks to provide their customers with the best solutions at the lowest possible cost.

In addition, several major Linux vendors have agreed to back a single version of the increasingly popular operating system. By doing so, these companies hope to avoid the fragmentation of Linux into multiple proprietary versions, as was the case with Unix. Development and support of a single, standardized version of Linux will give solution providers greater ability to provide long-term, cost-efficient solutions for their customers.

These vendors are drawing on lessons learned by companies in other industries in times past.

Sony's decision to keep its Betamax technology proprietary, along with slow product feature upgrades, led to a massive loss of share in the VCR market to the competing VHS system. In contrast, standardizing production on Ford's Model T sharply lowered costs, vastly expanded the market for automobiles, and made this car the market leader for nearly two decades.

What do you think of these recent moves? Let me know via phone at (732) 919-1530 or e-mail at [email protected].