TD Synnex CEO Rich Hume: AI A ‘Massive Opportunity’ For The Channel
Joseph F. Kovar
‘There’s going to be a whole set of services that emerge around AI. It’s going to be a great opportunity for the entire business partner ecosystem. But like every other every new technology, the entire ecosystem needs to be very thoughtful about where they think they want to participate. Investments will be required in order to allow them to achieve their objectives,’ says TD Synnex CEO Rich Hume.
AI Will Drive Massive Channel Opportunities
TD Synnex, the world’s largest IT distributor thanks to the 2021 merger of Tech Data and Synnex, is gearing up to help its solution providers take advantage of several high-growth opportunities. Those opportunities, according to TD Synnex CEO Rich Hume, include hybrid cloud, analytics, IoT, cybersecurity, and hyperscale infrastructure
However, Hume told CRN during a meeting at last week’s TD Synnex Inspire 2023 conference in Greenville, South Carolina that AI is generating the most excitement for channel partners.
Hume, citing a report TD Synnex did together with analyst firm Canalys, said his company saw a 625-percent growth in its partner base saying they will engage in or are engaged in AI opportunities.
“I think approximately 35 percent of the channel now is either active or has the aspiration to be engaged in AI,” he said. “So a very profound shift has taken place with the emergence of ChatGPT. But make no mistake, AI is going to be a major inflection point in technology. It’s going to create a lot of great business opportunity moving forward. I liken it to mobile phones and the cloud. It is going to be a titanic opportunity for everybody in it.”
AI today is often discussed from the perspective of ChatGPT, but it is so much more, Hume said.
“It will be integrated in the broader offering set that goes to market today. It’ll demonstrate itself in the hyperscalers and all of the AI-enabled servers they’ll build out. It will find its way certainly into what is resonating with everybody right now, ChatGPT. But make no mistake. … It’s going to be the totality of this AI portfolio that is going to create a massive opportunity.”
Hume, who last week returned from TD Synnex’s European Vendor Partner Summit, also discussed international aspects of IT distribution, and how distribution is more relevant than ever despite the appearance of self-service and direct sales for the latest technologies.
“Our customers are leaning on us more consistently and more frequently based on having to digest and understand these new technologies,” he said. “And we get that done through the specialized resources that we’ve been building over time.”
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Many of the new technologies coming out, such as AI and cloud, are aimed at end user businesses or customers looking to do more self service, or otherwise make them easy to use. Does that encourage certain vendors to bypass the channel and sell such technologies direct?
We’ve been having this discussion as an industry for four decades. And the one thing that I have learned for sure is that, generally speaking, a vendor’s go-to-market model is to take their limited resources and apply them to the accounts where they think they can have a robust business outcome. Then they look at all the accounts that cannot be covered by their direct sales coverage and have for decades used the business partner ecosystem to serve those clients. And the reason that has been the case and will hold up in the future is that economically, the channel is a low-cost route to market for our vendors. And it’s also a variable cost road to market, meaning that if the business partner ecosystem doesn’t sell, they don’t incur any cost or expense associated with that sale. Vendor resources are finite. They have to manage their business, and they have always used the business partner ecosystem to serve the accounts outside of their large enterprise accounts to be able to meet their go-to-market needs at a reasonable cost.
[Analyst firm Canalys estimates that,] of the overall addressable IT market, three quarters of that market is going through partners. Almost 92 percent of cybersecurity is delivered via the channel. So a lot of these high growth technologies or newer technologies are going through partners.
[Regarding] AI, last year AI barely registered in terms of the priorities of the business partner ecosystem. And this year, there’s been a 625-percent growth in our partner base saying that they’re going to engage in or are engaged in AI opportunities. I think approximately 35 percent of the channel now is either active or has the aspiration to be engaged in AI. So a very profound shift has taken place with the emergence of ChatGPT. But make no mistake, AI is going to be a major inflection point in technology. It’s going to create a lot of great business opportunity moving forward. I liken it to mobile phones and the cloud. It is going to be a titanic opportunity for everybody in it.