IBM's Strategic Alliance Causes A Stir With Partners

Linux middleware

In a three-pronged announcement last week, IBM elevated Red Hat and Novell to its strategic alliance program and unveiled its new subscription models for selling those companies' Linux distributions. IBM promised to open up significant sales channels and access to IBM innovation centers in countries such as Brazil, Russia, India and China.

In exchange, the two leading Linux vendors agreed to promote IBM's Web Community Server based on the Apache Geronimo application server and open-source Derby database. Red Hat and Novell currently back IBM's open-source Eclipse development tools project.

The deal is expected to impact IBM Business Partners, Novell's channel, Red Hat resellers and open-source consulting firms.

IBM in the past could configure its servers with Red Hat and Novell Linux distributions but did not give customers a way to purchase subscriptions directly from IBM in conjunction with hardware, middleware and IBM Global Services (ISG) SupportLine services.

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IBM plans to make its "one-stop shopping" offering available globally after Jan. 1.

The move is deemed a competitive posture to JBoss and MySQL and an affront to the evolving Linux channel. One IBM Business Partner said the one-stop shopping approach encroaches on the channel. "Who is IBM kidding? They say they want to work with us, then they give a revenue generator from us to their internal sales staff and squeeze us out," said Christopher Carter, president of CCI-SAP, Milwaukee. "I know of two projects the reps have come in and low-balled on the price point to [below] margins. Just another play by Big Blue to screw over the partners."

Armonk, N.Y.-based IBM announced last week that it ranks No. 1 in Linux services revenue, with a 29 percent market share, up 30 percent year over year.

For its part, IBM said IBM Business Partners will be authorized to sell the solutions and won't run into conflicts in the field with its sales force or ISG.

One analyst said it could benefit SMB partners. "The end customer would find comfort in the fact that their ISV or VAR is providing a solution that shows up on IBM's price list regardless of whether they're actually selling the IBM package or one of their own creations," said Dan Kusnetzky, vice president at IDC.