eChannelLine Daily News 11-September-2007 Channel consolidation inevitable: Symantec's Thompson by Robert Dutt SAN DIEGO -- Consolidation in the channel is inevitable as the IT industry continues to mature, Symantec CEO John Thompson told some 300 Symantec partners at the company's Partner Engage 2007 conference here Tuesday morning. Following the ever-popular example of early 20th Century consolidation in the automotive channel, Thompson said that with maturity and consolidation in the manufacturers of the IT world, channel partners will merge and consolidate as well. "Channel partners are not immune from the maturity of an industry," Thompson said. "It has happened in every other industry. It's as inevitable as life and death. The choice is, do I go deep, or do I go broad." Thompson told partners that they should follow the leads of both the vendors they deal with, and the customers they serve, and to keep track of the value-add they offer, in relation to what customers want. If the two don't map up, he said it's time to ask hard questions about where the organization is going. Thompson also addressed the results of those hard questions being asked internally at Symantec, calling the transformation of Symantec over the last 24 months as "the most challenging two-year period I've ever had." Thompson likened the changes at the company to changing the flight deck of an aircraft carrier while at sea and still launching and landing planes. But he stressed that while the software company has changed, and will continue to change, that the channel will continue to be its primary go-to-market. "You are too critical to what we do, and we know we can't get to the ultimate goal of world dominance without your involvement," he said. And while the company has been a big buyer, Thompson hinted that Symantec may be keeping its wallet in its pocket a bit more, noting that the product line was solid as-is, and that any acquisitions would be small, purchased to "bolt on" more capabilities. Of course, the veteran executive quickly added that he wouldn't rule out a major purchase, should the right opportunity present itself. On the services side, Thompson said that Symantec would be looking to get partners more involved in services, which represent five times the revenues accessible via software alone, and increase customer satisfaction, helping to make sure that they use the software and re-up at the end of their contracts, creating ongoing revenues for Symantec and partners alike. But he stressed that expansions on the services side will have to be accompanied by efforts to ensure that the partners delivering those services are certified and ready with the needed expertise. "There are more services revenues out there than any of us can get to, so we need to be careful that the discussion of margins [ on software] is not the catalyst for debate between our organizations," he cautioned. "If [customers] don't use the software, we don't get the cash flow that fuels future growth and expansion. That's what I want all of our partners helping us with. The company's focus at the conference seems to be a message of cross-selling the company's six main categories of products, or as Symantec put it, "connecting the dots." While the company does not expect all of its partners to be experts in all six areas, Randy Cochran, vice president of channel sales for the Americas, said that the company wants all partners to be "conversant" in all the areas. "You need to be able to paint the picture, and be able to call in the resources to solve those problems, be they Symantec resources, or the people in this room." Noting that there were over 2,000 Symantec certifications in the room, as well as countless other vendors' and industry standard certifications, Thompson echoed Cochran's calls for partners to partner amongst themselves to meet the needs of their customers. "Many of you are already doing that today, with the understanding that you'd rather have part of something than all of nothing," he said.