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IBM And Red Hat: What’s Next For Their Channel Programs

Now that the mega-deal is a done deal, both IBM and Red Hat channel chiefs speak to CRN about the opportunity to seize synergies, along with the importance of preserving divisions.

Now that the earth-shifting merger of IBM and Red Hat is officially complete, channel leaders from both sides of the deal are working to maximize the synergistic opportunities for their partners while preserving independence and fairness across the two not-always-overlapping ecosystems.

IBM and Red Hat channel chiefs, John Teltsch and Mark Enzweiler, respectively, told CRN it's important for their programs to remain apart even as they attract many of the same solution providers and incorporate each other's best features.

"Our joint goal is to build the world's best partner ecosystem programs between our two companies," said Teltsch, general manager for IBM’s partner ecosystem. "But they will remain independent and very distinct."

[Related: IBM Sells $20 Billion In Bonds To Fund Red Hat Acquisition]

While maintaining that separation, both programs are preparing to welcome new partners that see the opportunity to develop their customers' cloud architectures across hybrid and multi-cloud environments, Teltsch said.

"A lot of these partners are spending a lot of time looking at each other's offerings," Enzweiler, senior vice president for Red Hat global channel sales and alliances, told CRN.

With the acquisition official, Enzweiler sees "a lot of hands going up of Red Hat partners wanting to become IBM partners. And I think we'll see a lot more of them come in."

They want to know how to get authorized and certified with IBM, and what are the offers that will help them on-board quickly, he said.

But they're not asking for a single, unified program, and there's no plan in the works to create one, Enzweiler said.

There's a reason it's so important to maintain distinct ecosystems.

Red Hat wants to remain a best-of-breed vendor, and partner neutrality—both among its channel and technology alliances—is critical to maintaining that posture, Enzweiler said.

IBM and Red Hat have been coordinating much of the channel development work through a Post-Close Synergy Office. Partner teams are exploring how to extend the reach and range of both channels.

There's a lot Big Blue can learn from Red Hat's approach, Teltsch said, noting the open-source giant sees more than 70 percent of its engagements, and revenue, through partners.

Working with his peers in Raleigh, N.C., presents a "huge opportunity for IBM to learn how to become more efficient, more effective from a partner perspective," he said.

Enzweiler's team has developed some unique go-to-market models that prioritize value over volume. That focus, particularly on specialized skills, has delivered great results in scaling recurring revenue, Teltsch said.

"That's a model we can learn from, even on the hardware side," Teltsch said.

IBM added 14,000 partners to its program last year, but the company wants to focus more on generating value for customers through its expanding channel.

"We're rethinking our enablement, skills, on-boarding around our partner program," Teltsch said. And "Red Hat's approach is reaffirming."

The companies will incorporate each other's strengths as they grow and cultivate their distinct partner ecosystems.

"The common goal here is for both companies to align the best practices over time," Teltsch said.

To enable partners, IBM and Red Hat made resources available online Tuesday morning aimed to "help them learn what this acquisition means for their businesses," Teltsch said.

Those include "go-to-market run books" that offer guidance, messaging on synergies, sales plays and enablement opportunities.

IBM sellers and partners can learn more on the company's Seismic platform—a partner-enablement toolset that will also be available to Red Hat internally and its channel.

"We're going to create synergies that will benefit our partners," Teltsch said, that include systems and tooling spanning both ecosystems.

Enzweiler started the day by emailing solution providers around the world.

He told IBM partners that want to become Red Hat partners they can go through a standard process to get a provisional certification. That will give them a year to meet all the requirements for their level.

As those ecosystems increasingly overlap, Red Hat will strictly protect incumbency for partners that have already engaged customers and neutrality among those chasing new deals.

Everybody plays by common rules of engagement, both channel chiefs told CRN.

"We honor route to market and incumbency," Teltsch said. "If a partner has a relationship, they are the provider of value, that will continue. It will remain on red paper, not flip to blue paper. That is something we will be maniacal about."

Partners are watching those complex dynamics translate into real developments in the field.

"We are cautiously optimistic about the Red Hat acquisition," said Darrin Nelson, vice president of software sales at Sirius Computer Solutions, a powerhouse in the IBM channel that's been building out its Red Hat practice.

"We anticipate this acquisition not only injecting adrenaline into our Red Hat business, but hopefully into our IBM software business as well," Nelson said.

Sirius is a big fan of OpenShift, Red Hat's application containerization platform, and Ansible, Red Hat's infrastructure configuration and automation solution.

"This acquisition finally enables IBM to be more relevant in public cloud considerations," Nelson said.

But that doesn't mean Big Blue can rest on its current technology stack.

"IBM cannot stop here," Nelson said. "We're hopeful they build on this acquisition and drive higher-value outcomes to the market via organic innovation and other strategic acquisitions such as this one."

Ensono, a partner of both companies, sees a benefit in the merger for its customers, Tim Beerman, CTO of the managed services provider, told CRN.

"The investment will deepen Red Hat’s pockets to build on its existing cloud capabilities, strengthening its presence in the cloud market," Beerman said. "It opens up more opportunity for businesses to manage workloads across multiple clouds, so MSPs should be looking to expand their hybrid IT offerings."

Teltsch told CRN many IBM partners seem eager to get on-boarded quickly with Red Hat.

Especially for those specializing in analytics, Io, or security, "it gives them this hybrid, multi-cloud capability" that thrusts them to the leading edge of the services market, Big Blue's channel chief told CRN.

"The opportunity to play in this enterprise hybrid world, lead with open-source products Red Hat brings to the table, it’s a game-changer for IBM," Teltsch said.

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