Service and support a work in progress 4 July, 2007 By Paul Weinberg

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Also, 37 per cent of revenues in the IT industry are derived from maintenance and support, compared to 42 per cent for products and 21 per cent professional services/consulting and education, he told eChannelLine.com.

Channel partners continue to represent the primary means that most IT vendors rely upon to make their maintenance, support and warranty programs available to end users.

However, Sweeny has heard complaints from resellers that the process "appears to have been far more informal for too long."

"There is a major gap between what the channel partner is able to do and the support that the vendor is willing or able to provide."

Sweeny stated he was "actually surprised" in interviews to discover what channel partners most wanted from vendors.

"I expected that I would hear, 'more money,' and that was not at the top of the list. It was more support, more communication -- 'share more with me, include me in your processes, so that I can better serve our mutual customer.'"

Sweeney discovered a disconnect between the parties, which he explained, "is partly systems, partly mindshare and partly the original charter or mandate behind the vendor channel relationship."

The challenge for everyone in the supply chain including vendors, channel partners and end users is how to best manage maintenance and support contracts, commented Scott Herron, chief executive officer at, MaintenanceNet which is a developer of a contract management application.

"So from a supply chain perspective it is a revenue opportunity, to make sure they are capturing the service renewal, and from a customer's perspective, it is really a management capability, at being aligned with your supply chain to ensure the assets are properly covered."

Many end user customers including those at the enterprise level "are not fully leveraging" the value of their maintenance and support contracts in software, observed Nauman Haque, research analyst with Info-Tech Research Group.

"Many companies that we talk to are not aware of, nor do they make use of all of these additional features both in the new version of the software as well as the additional benefits and throw-ins that are associated with the contract."

Haque has found in his research that maintenance contracts are being purchased as an insurance policy to mitigate risk and to ensure compatibility.

"So if something happens, they want to make sure they can transfer that risk to the software vendor. But really, they are not making use of all of the new features and functions that are available to them."

This may be just fine for the channel partners and IT vendors since maintenance and support is "a slow growth area" for revenue in mature IT markets in North America and Western Europe, reported Ron Silliman, principal research analyst at Gartner.

"In the US and Canada the build out of technology is largely complete. If you are talking about South America or Southeast Asia, then yes, [maintenance and support] are growing by leaps and bounds because it follows the build out of the technology."

However, Silliman warned that the IT industry cannot afford to be complacent about maintenance and support.

"If you don't do it, you will allow competitors into your account and they will take your accounts away from you."