Perth, Australia: The Annual edition of Canalys Channels Forum APAC region was held in Perth last week. Partners from across APAC, the majority of who were from India, headed to Perth, the vibrant capital of Western Australia. About 900 delegates from across the APAC region attended the event.

Steve Brazier, CEO & President- Canalys in his keynote address on the tech trends said that the death of IT hardware channel has been greatly exaggerated. “Technology is transforming every industry, and the channel is lucky to be at the heart of this new industrial revolution. Good and bad tech news stories have frequently hit the headlines in 2017. Artificial intelligence, deep learning, IoT, robotics, chatbots, cloud and edge computing are driving the channel forward, while issues around regulation, ethics, tax, security and monopolistic behaviour cause complications. Augmented and Virtual Reality (AR & VR) offers exciting opportunities for human computer interaction, the enhancement of places and new business cases. Many use cases in US, China, Japan and Singapore came to the limelight where AR/VR technology has been adopted as part of training programs across certain industries such as manufacturing and healthcare. With the potential to spread even further, it brings immense opportunity for the channel partners across the world for worldwide growth. Tech truly offers partners a ‘Limitless Landscape’.”

According to Canalys, APAC distributors grew 8 percent and partners grew 10 percent in the first half of 2017. The organisation expects channel partners in APAC to grow at least 10 percent per annum over the next three years. Resellers have been told for years that they need to expand into services to bolster profitability. However, Brazier predicted that hardware would still contribute more than 50 percent of revenue for 90 percent of partners in 2020.

Steve spoke about PC selling going up. “Whoever said the PC was dead two or three years ago was wrong. Commercial PCs are growing, and price points are going up not because there has been a shortage of memory and component, but also because some people are willing to pay more for well-designed notebooks that are thin, light and sexy. Prices are going up, that means margins are going up. Better segmentation of the market is helping, better marketing is helping and this is providing growth,” said Brazier.

The world's top seven hyperscale cloud providers (Super Seven) are reshaping the IT channel, with industry trends increasingly guided by partnership decisions of the "super seven, according to Canalys. The Super Seven includes Amazon Web Services, Microsoft, Google, Facebook, Alibaba, Tencent and Baidu are rewriting the rules for the IT supply industry. Tencent and Alibaba are planning very aggressive and expect them to appear in most APAC countries in next 12-18 months. The super seven face a massive capital expenditure challenge.

AWS is working closely with VMware which allows people to move applications quickly from one environment to another. Microsoft and AWS are spending US$2-3 billion a quarter each on building datacenters, whereas Salesforce is responding to Microsoft's acquisition of LinkedIn and the threat that might crop up. The super 7 are thus changing the structure of the industry and the priorities of component vendors and the focus of their sales forces and their design," Brazier said.

“The big three power providers – AWS, Microsoft and Google – are now buying more servers per quarter than HPE or Dell EMC selling worldwide in the same quarter. The scale of capital investment is simply enormous and the component suppliers are responding to this. Google was first at Intel Sky Lake. You cannot get Sky Lake inside AWS. Well, think about it. Today, they have spent something like $20 billion on their data centres,” he added.

India and Singapore too is encouraging a cashless system. Singapore government is working with seven local banks to allow consumers to transfer money to each other just by phone numbers.

Lastly, with solid growth in PC sales in Asia-Pacific, opportunity for the channel business seems promising for the next 3 to 4 years. It is also expected that there is boom in edge computing, as local processing power increases at the fringes of the network to support the computing firepower in the cloud. With this the ability to process multiple data sources at high speed close to the source of the data will go up and up.