Solution Providers Anticipate Brighter Days Ahead
2021 Channel Forecast report reveals scarred, but resilient, channel
By Chris Gonsalves
Last February, Channelnomics (formerly known as The 2112 Group) took a hard look at the factors at work in the technology channel and declared, with some degree of certainty, that we knew what the year of 2020 would look like for partners and the vendors that serve them.
Coming off the economic malaise of 2019, the safe bet for 2020 was guarded optimism. We forecasted a year of slow but steady progress in cloud and service transformation, and modest growth in revenue and profitability built around key emerging technologies and platforms. Looking back now, these predictions might just as well have come from a different decade. In a different industry. On a completely different planet.
We couldn’t have known it at the time, but last February wouldn’t simply mark the beginning of another incremental year of adjustment in the channel. It kicked off an entirely new era in our industry, our businesses, our lives, our world. Much – but not all – of that turmoil was due to the global coronavirus pandemic.
In our 2021 Channel Forecast report, we reveal that fewer than 60% of the partners we polled – 315 North American solution providers, systems integrators, MSPs, resellers, and other channel entities – saw meaningful growth in 2020, more than 20 points short of the predictions of just a year ago. That gulf between expectation and reality is the greatest ever measured in more than six years of Channel Forecast research.
We saw a similar gap in 2016, though that was more a difference between great and good.
This year, it’s a rift spanning sour and dire.
According to our research, just 70% of the channel will enjoy meaningful growth in 2021, a sobering figure that transcends company size or vertical focus in the population we surveyed, and it’s the lowest we’ve ever reported.
The epidemic spread of malignant viruses is hardly a new phenomenon, of course. Viral infections are as old as life on Earth itself. What was novel about the coronavirus crisis is that it came at a time of unprecedented computing and communications technological capability.
Very quickly, we saw technology play a critical role in helping the world deal with COVID-19. IT service and solution providers remain vital to this effort. Already well-positioned to administer robust IT services remotely, channel partners are now delivering the communications, collaboration, networking, bandwidth, and security capabilities their clients need to support remote working, remote learning, e-commerce, and more in a COVID and post-COVID world.
Expanding their capacity and capabilities to embrace this core group of growth technologies is proving to be the recipe for limited success for partners in an otherwise withering environment, our research finds. As the 2020 dust settles, such solutions, and additional, adjacent services to support them, should help buoy channel IT providers through 2021 and beyond.
Given the chaotic nature of 2020, the key findings from our 2021 Channel Forecast research understandably diverge from many of the predictions we made last year. However, obscured between the bright, red lines, they also demonstrate the continued resilience of partners and the channel itself.
Particularly in the big-picture analysis of what lies ahead, their prognostications may not be as exuberant as they were in years past, but most of this hearty channel contingent expects to weather the storm and remains poised to put together a hopeful year of lower double-digit growth with better times ahead.
Here’s to brighter days.
Download the report here.
Chris Gonsalves, senior vice president of research at Channelnomics, is an award-winning journalist, researcher, author, and public speaker who’s spent more than two decades researching and analyzing enterprise IT systems and the channel ecosystems.