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Spanning Cloud Apps' channel outlook following acquisition by EMC

Spanning Cloud Apps was bought by EMC two months ago. The company's vice president of sales explains what that will mean to channel partners.

A couple of months ago, Spanning Cloud Apps became an EMC company. The acquisition was one of three acquisitions -- Spanning, Cloudscaling and Maginatics -- all of which are part of EMC's hybrid cloud strategy and vision across cloud infrastructure, storage and data protection, according to EMC.

SearchITChannel caught up with Garrett Jones, vice president of sales at Spanning Cloud Apps, to find out how the EMC acquisition will impact the company's 200-plus channel partners, who account for almost one-third of Spanning's new business revenue.

Jones joined Spanning in May, just months prior to the EMC acquisition. As vice president of sales, a title he held both prior to and after the EMC acquisition, he is also responsible for Spanning's channel partners and noted that 25% of his resources are channel-focused. Just last week, Spanning made its first post-EMC-acquisition product announcement, an enterprise-grade cloud-to-cloud backup service for Microsoft Office 365 (general availability will be sometime in the first half of 2015). That product joins the company's Google Apps and Salesforce backup services.

What do Spanning partners need to know about the EMC acquisition?

Jones: As Spanning Cloud Apps, an EMC company, we're going to keep doing what we've been doing. By the end of Q4 we expect to increase the number of partners by about 25%, or about 50 partners. We're on a recruiting push, especially around smaller managed service providers (MSPs) selling services with cloud.

The EMC acquisition validated what we've been doing so we're continuing down our path except that now we have more backing, more resources and we have EMC reps opening doors for us.

We have a healthy run rate among small businesses, usually below 25 seats. Those are customers who buy product via a credit card. In those cases the channel is not involved. We do have programs where people start a trial, they don't put down a credit card, and we'll filter them to channel partners to see if we can close that business.

We've seen a real upstream migration into the enterprise, in terms of the size of the customer. Here our typical sales motion is that we find a customer or they come to us, we'll find out who's administering their Google Apps environment or [whether they are] working with any Salesforce administrators and use that as an opportunity to onboard channel partners. Many times they're already working with a channel partner so we'll let the partner know about the opportunity.

Our channel business is outgrowing Spanning growth overall, meaning that channel is growing at an accelerated rate. One thing that changes the mix of channel versus direct is [our] Salesforce business. Partners don't resell [the Salesforce cloud backup service from Spanning], they don't typically transact. Partners consult and do integration around Salesforce and some administration of the Salesforce environment – that's the value-add to their business. [The Spanning Salesforce service is available to customers in Salesforce's AppExchange.]

Our Google Apps business is pretty channel-centric, Salesforce not as much. Office 365, which we just announced, [is] going to be heavily channel-centric, and we'd expect the lion's share of revenue in that space to come through the channel.

So now that Spanning is an EMC company, what does that mean to partners?

Jones: We have our channel program, and we'll maintain our channel program. Ninety-five percent of our partners will continue to be Spanning partners and wouldn't necessarily become core EMC partners. Think about EMC's business and the legacy there; [there's] a lot of hardware, infrastructure and systems deployment. The majority of our partners are born in the cloud so you wouldn't see them picking up the more traditional EMC portfolio.

That said, we're part of what EMC calls their Data Protection Cloud organization, which also includes Mozy and Maginatics. … In terms of aligning the EMC and Spanning channel, our partners have the opportunity to expand their portfolio. … Our partners ultimately … protect data that resides in cloud applications, while Mozy protects information that resides on the endpoints (desktops, laptops, etc.). So … you're protecting the data in the cloud; what about the data on the device as well?

We started to perform some education and general awareness to the Mozy channel about how it makes sense to complete that protection around the information that resides in Google Apps, for example. We're educating our partners as well; they're seeing the opportunity to sell more Mozy.

We think that Maginatics will also open up a lot of opportunities for our partners to expand their portfolio and be on the cutting edge of technology in this space. It's a budding market, where real problems have not yet been solved. Our born-in-the-cloud partners are adding value, solving pain points for customers in the cloud. With our product, it's about backing up the data that's unprotected. I think it's going to be a logical extension for them to go pick up these new technologies as we pull this together. (Maginatics enables unified data protection and management across disparate private, public and hybrid clouds.)

Do you expect to integrate the Spanning channel with those from EMC or the other acquisitions?

Jones: For our partners, in a lot of ways nothing has changed. They're working with us in the exact same way. The processes are the same in terms of how they quote, procure, sell our products. … Our program is the same. They shouldn't see any change, shift or disruptions. I think a lot of our partners are excited about being able to say, "Spanning is an EMC company."

A lot of our competitors are smaller companies, privately held, and you're protecting your data so there's a level of reassurance … being back by a company like EMC. So it may change the partner's value proposition. But day to day, nothing has changed.

Now that we're on the EMC price list, all EMC partners have access to sell Spanning. The backup is going to follow the application so EMC has partners that are also reselling Google Apps and Office 365 – so they have the opportunity to sell Spanning as well.

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