Eaton Steps Up Rack PDU, IPM Software Sales Offensive; Partner Recurring Revenue On The Rise

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Herve Tardy
Herve Tardy

Eaton is stepping up its rack PDU sales charge, which is paying off in a significant increase in recurring revenue software sales for its partners.

Eaton – a $23 billion power management behemoth – in the last several months has refreshed its entire ePDU (enclosure power distribution unit) G3 lineup resulting in an astronomical increase in deal size for partners and recurring revenue with Intelligent Power Manager (IPM) software and PredictPulse remote monitoring and management service.

[Related:Rise of Rack PDUs: Market Opportunity Is Promising for Eaton and Partners]

The company has also expanded its product lineup with the addition last summer of its RS Enclosure, the first rack in the data center cabinet market made available through channel partners.

The new product lineup, combined with Eaton software, is driving dramatic sales gains for partners, said Eaton Vice President Herve Tardy in an interview with CRN.

"Every $1 of rack PDUs sold by the channel translates into a sales pull-through of another $3 to $4 in rack PDUs and another $3 to $4 in UPSes, plus the recurring revenue of 15 percent of the total sale," Tardy said. "It's huge. The fact that we didn't have a competitive rack enclosure line previously put us at a disadvantage. Now we have the best rack enclosure in the industry at the right price."

The PDU offensive continues the recurring revenue charge that Eaton began last year with its Intelligent Power Manager (IPM) and PredictPulse offerings.
Eaton's IPM software sales grew a whopping 400 percent over the last year, driving robust recurring revenue sales through the 300 partners actively selling IPM and the PredictPulse service, said Tardy.

Eaton is introducing new Rack PDU SKUs every month, said Tardy. "This product line is an unbelievable margin opportunity for our partners," Tardy said. "To select the right PDU configuration you have to go through an 8-step process. For UPS it is a 3-step process. It is a fairly technical, complex sale. Partners add real value in this market."

The intelligent rack PDU market – which grew at a six percent clip in 2016 - is expected to be 50 percent of the power market in the U.S. by 2020, according to IHS, a London market research firm. The IT rack enclosure market, meanwhile, grew at five percent in 2016, according to IHS.

"The rack PDU market is on fire," said Tardy. "It's a big opportunity for our partners. We are moving fast in this market. The rack PDU is becoming the intelligent hub of the entire power chain."

Before the Eaton PDU and rack enclosure sales offensive- which began in earnest late last year -  Eaton simply did not have competitive offerings in those markets to go head to head against power management kingpin APC By Schneider Electric, West Kingston, R.I. That put Eaton at a competitive disadvantage versus APC, a perennial power in the rack PDU market.

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