Feeds

Networking vendors eat their babies

Hey, it's a tough world out there

  • alert
  • submit to reddit

Internet Security Threat Report 2014

Networking vendors are poaching business from their dealers, making life even tougher for the beleaguered corporate reseller sector, trying to close sales from customers with drastically lower budgets.

Recovery in the networking market might be delayed up the second half of next year, according to a survey of networking resellers in Europe and the US released today.

Ninety five per cent of U.S. respondents to the Global Touch survey indicated that networking equipment sales for Q2 2002 were below the same period in 2001. Just over half (52 per cent) of European respondents indicate that the quarter was flat compared to the same period in 2001, while 27 per cent said that it was below the same period in 2001.

Many respondents indicating that customers are cancelling or postponing orders, but there are some signs that the market is bottoming out.

Most European respondents predict moderate growth in the single digits for Q3 2002. 3Com and Cisco Systems are predicted to experience the strongest growth among networking equipment vendors. US respondents predict a flat Q3 2002 compared to the same quarter last year.

Denise Sangster, president and chief executive of Global Touch, a US channel consultancy, said that end users' "technology replacement cycles extended to levels reminiscent of the mid-1990s".

She added that many equipment vendors are using their direct sales forces to compete directly with partners, "often providing customers with prices and terms well below best channel prices or terms.

"When they can't sell their products directly to customers or to a channel partner, brokers or liquidators are being sold new, excess products. Brokers or liquidators then sell the latest and greatest products at pennies on the dollar or Euro."

Sangster commented that the recovery of the networking sector is tied to a recovery in end user spending which she now believes will not happen until the second half of 2003, later than many commentators previously forecast. ®

External links

Global Touch's study

Internet Security Threat Report 2014

More from The Register

next story
Docker's app containers are coming to Windows Server, says Microsoft
MS chases app deployment speeds already enjoyed by Linux devs
IBM storage revenues sink: 'We are disappointed,' says CEO
Time to put the storage biz up for sale?
'Hmm, why CAN'T I run a water pipe through that rack of media servers?'
Leaving Las Vegas for Armenia kludging and Dubai dune bashing
Facebook slurps 'paste sites' for STOLEN passwords, sprinkles on hash and salt
Zuck's ad empire DOESN'T see details in plain text. Phew!
SDI wars: WTF is software defined infrastructure?
This time we play for ALL the marbles
Windows 10: Forget Cloudobile, put Security and Privacy First
But - dammit - It would be insane to say 'don't collect, because NSA'
Oracle hires former SAP exec for cloudy push
'We know Larry said cloud was gibberish, and insane, and idiotic, but...'
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.