Telco denies formation of its own reseller arm is a threat to channel partners

BT has hit back at implications that the formation of its reseller iNet poses a threat to channel partners.
The telco giant formed iNet earlier in the month after it merged its two reseller arms: BT SkyNet and BT TNS (CRN, 17 July).

BT was criticised by some channel players who saw the formation of iNet as a BT ploy to strengthen its direct business and a potential blow for BT’s indirect partners.

Cormac Whelan, business management director at BT, denied these claims and insisted that all is well in the BT channel.

“BT has always had a multi-channel approach to the market, and the capabilities of iNet are also available to our channel partners,” he said.

“Channel partners could look at [the formation of iNet] as a strengthening of BT’s direct sales, but they may think we have taken two of their competitors out of the market.”

Whelan added that iNet will focus on the mid-market in the LAN and IP telephony convergence space, which covers mainly the 50 to 200 user market.

Scott Dobson, managing director of voice over IP distributor Vcomm, said: “BT resellers are focused mainly on the SME segment, which BT does not have the capability to reach. However, if BT is acquiring integrators, it is sending out a message that it wants to focus on [the SME] arena, which its channel is already servicing.”

Dobson added that the acquisitions of SkyNet and TNS are an indication that BT may make further acquisitions to service certain markets directly.

Peter Patsalides, managing director of telecoms provider Bailey Teswaine, said that telcos making acquisitions to contribute to a mixed channel strategy is something that is becoming more common.

“Partners tend to add more value than direct sales, so I don’t think BT’s partners will be worried because the channel is such a different type of sale,” he said.

Patsalides added that BT does not always get its channel strategy spot on, but channel conflict depends on which part of BT partners work with.