Strategic partnerships/alliances to create new markets

In mid-May, Alcatel-Lucent Enterprise gave recognition to their top performing partners during their annual regional Connex event. Over 60 partner organisations from across APAC attended this event that was themed, “Technology for Good.”

During the event, the communications and networking vendor offered a deep-dive, or at least access to the folks who could deep dive into solutions like Purple on Demand, a subscription-based solution for secure business communications, and the autonomous OmniVista Network Advisor that minimises network downtime and enhances experience through integrated Artificial Intelligence/Machine Learning capabilities.

EITN was also present at this conference and when attending a regional conference for partners, we thought it would be a good idea to find out what “partners” actually mean to this vendor.

A chat with Damien Delard, Vice President at Alcatel Lucent Enterprise APAC and Dirk Dumortier, Head of Business Development at Alcatel Lucent Enterprise APAC, sheds some light.

We are using the word partners, in all of its different flavours, Dirk said when asked to explain what ‘partners’ means to the organisation.

Here it is good to note the types of interactions that happen can help to define the relationship. For example, there are the usual partners who interact with Alcatel-Lucent Enterprise (ALE) which is a vendor. “They buy products from us, value-add to it with services and then sell it to the customer or end user,” Dirk said.

There are also technology partners with whom ALE collaborate/innovate with, for example Nokia, to bring specific technologies to the end user. “So, we bundle their technology with ours and sell it to our partners who then sell it to the customer.”

First gen, second gen?

The category of partners that were described first, could be further categorised into first-generation traditional partners who sell only pure telephony solutions to the customer,

Interestingly, Dirk observed that more and more partners overall, are expanding their function to also integrate systems. Some of these partners are also big enough for ALE itself to become a part of the former’s total solution as a technology partner.

This was a natural evolution that the channel ecosystem underwent and finally settled upon, with ALE also consciously opting to work with resellers who specifically sell to specific verticals or industries.

“You need to classify them because they have specific needs,” Dirk explained.

So, how are resellers who sell cloud-based offerings different from traditional partners?

When asked this question, Dirk responded, “That is of course to do with how they go to the market.”

He was talking about flexible ways in how resellers can bring solutions to market, and basically change the spending model from one that is capital expenditure (CAPEX) to operating expenditure (OPEX). The cloud is well-known as a delivery platform that can effectively and efficiently offer this OPEX business model.

Definitely, partners also have to be able to embrace a different way of approaching their customers. For example, a hotel in Australia is buying an OPEX-based solution which is also flexible. In other words, the hotel business pays only for what they use, or the occupancy rate.

Damien also pointed out that this was very useful during the pandemic when occupancy rates in the hospitality industry was very low; this particular hotel was able to rake in substantial savings.

Strategically creating new markets

According to Damien, traditional partners still contribute about 70-percent of their revenue.

So, why is Alcatel-Lucent Enterprise spending so much time to grow their strategic partners?

“It is because this segment is growing very fast, and they bring us to new markets, said Damien adding that certain markets have become quite commoditised and saturated already.

“Data networking and WiFi – there are so many suppliers already,” he shared. “So, we ask ourselves, how can we differentiate? And the answer is with strategic partnerships for example with partners like Nokia.”

Damien explained two types of relationships with Nokia, the first being that of a distributor of Nokia solutions. “We actually take Nokia equipment and resell them to the customer which in this case is a service provider. In another type of relationship, Nokia buys ALE’s solutions and sell it.

This also happens when they both approach a potential client together to bid for a single project.

“This is an alliance, and it seems complex. But the beauty of this is that it creates a lot of new markets for us,” Damien concluded.