Networking: Change of Guard

HP Networking dethrones Cisco from the #1 slot for the first time in the Channel Satisfaction Survey; partners are also happy with others like Juniper, Netgear and D-Link

The biggest upheaval in the Channel Satisfaction Survey 2015 took place in the networking category. Cisco was dethroned as the most popular channel-friendly networking vendor for the first time in the history of the survey; HP Networking was the gainer emerging as the new darling of the channel. There were signs in the last few years with the gap diminishing between the two—this time it is not just HP and Cisco, the gap between all the top 5 vendors (Juniper, Netgear and D-Link are the others) has substantially reduced.

Analysis of any channel partner perception about these five networking vendors should keep in mind some critical points. Cisco, HP and Juniper are now primarily focusing on the high-end networking products and services (including software-defined networking) while Netgear and D-Link earn their bread and butter from the more low-end commoditized products like switches and routers. This should not give the impression that Cisco, HP and Juniper have stopped selling switches and routers (their active commercial channel is evidence on the contrary). The survey amongst the base of channel partners, therefore, has consciously attempted homogeneity within the networking category though the vendors might have come from a heterogeneous background.

Marketing and after sales support, commercial terms as well as relationship management parameters have helped HP Networking turn the scales on Cisco. Partners are happy with HP’s innovative market development programs, its co-op funding programs as well as its flexibility in conducting localized promotions. Before HP’s demerger in FY2016, the HP Enterprise entity has initiated new MDFs and this seems to have paid strong dividends amongst partners. Naturally, partners are also happy with HP’s back-end incentives and schemes, flexibility in commercial terms and credit policies.

Cisco though is preferred for its technological leadership, product diversity, price vs performance ratio and overall product reliability. But it has lost out on marketing and after sales support and more particularly on commercial terms. Cisco’s shifting focus on areas like servers and storage plus its solutions-based approach for large projects like smart cities might be partially responsible. Nevertheless, the networking giant needs to communicate its schemes and incentives more promptly, and enhance its credit policies and profit margins for partners.

Juniper, on the other hand, runs HP close on both marketing support and commercial terms. Juniper’s point of sales materials, prompt communication of schemes and incentives and their settlement has endeared many partners. Another set of partners are especially happy with Netgear’s promptness in stock replacement and turnaround time as well as its consistency in honoring commitments made to partners. Even D-Link’s product pricing, credit policies and profit margins are making some partners satisfied.