Tech Data, XenSource Talk Up Virtualization
Xensource selected Tech Data as its first distributor in the United States for its XenEnterprise server virtualization platform and plans to use the channel as its primary means to reach customers, said John Glendenning, XenSource vice president of worldwide sales.
"We're looking to drive volume virtualization. Today, we've barely scratched the surface with 5 to 6 percent penetration for virtualization servers," Glendenning said at Tech Data's TechSelect conference in Chicago Thursday.
The conference was XenSource's introduction to Tech Data's SMB solution providers, many of whom said they were interested in virtualization.
XenSource, based in Palo Alto, Calif., is unique in that it plans to adopt a channel-focused model so quickly in its existence, said Ken Lamneck, president of the Americas at Tech Data.
"That's a nice channel story. They're really trying to build the business around the channel right out of the chute," he said. "They're asking us the right questions and listening. 'How do I position this? Does it make sense if I did this bundle?' They're looking to build a grass roots channel model."
The software retails for $750 per jewel socket server and solution providers should be able to make about 15 points margin plus significant attached services revenue, Glendenning said.
"There is a low rate of penetration with this. People can't continue to spend money on servers as energy costs continue to rise and they run out of space. This is the perfect solution to address that concern. The product is priced for volume and there is no pressure to deliver discounts," he said. "Given that the customer is unlikely to have significant skills in this area, we're expecting solution providers to make a healthy margin."