Two companies that many people have not heard of got together last
week--Avanade and En'tegrate, with the former buying the latter. It is the latest chapter in the movement towards large reselling organizations with an international focus.
Make that resellers that handle products from Microsoft Business Solutions. Because right now, there's a clear contrast between what's happening with the MBS channel and that of its largest mid-market rival, Best Software/Sage.
Super VARs, or VARs that are morphing into systems integrators, are developing for MBS products to the point that it looks like new level of distribution is being created that will help in the verticalization of MBS products.
The 3,000-person Avanade, owned almost 50/50 by Accenture and Microsoft, purchased En'tegrate, a Chicago-area reseller that was one of the largest Axapta resellers in the United States. Tectura, an MBS VAR based in California, aims to have a run rate of $300 million by 2006 as it expands across the world. Epartners, based in Irving, Texas, and Interdyn, a consortium of Great Plains resellers, both established European connections last year, while Altara, a New Jersey-based MBS VAR opened its London office in the last few weeks, with plans to have 40 to 60 people working in Europe by year's end.
This growth is being fueled largely by two MBS lines, Axapta and Navision, which are strong overseas and growing in the U.S. By contrast, Great Plains, the best-known accounting product in this country, and Solomon are not well known overseas.
Best, on the other hand, seems unlikely to see the growth of its channel partners, at least in part because there's more investment money available for those doing business with Microsoft.
Best has also taken a different approach to marketing products on a world-wide basis. It doesn't, and that means less need for international resellers. The MAS 90/200/500 line, strong in the United States, is virtually unknown elsewhere. Accpac is international, but largely in the English-speaking countries. Sage Ltd, Best's parent, markets different lines in different countries, buying players in Spain, Poland, and elsewhere that are little known here. On the low end, Sage has Peachtree in the U.S., Simply Accounting rules Canada, and Pastel, strong in South Africa, does not sell here.
Microsoft likes to picture itself as having the R&D that Best lacks. Best says that technology isn't everything and that Sage has purchased players that are dominant in many countries.
Thus, the lines are drawn for the battle that has been underway for some time. It's too early to tell how the battle will be fought by the MBS multinational VARs facing off with the regional players, or even who the players will be.
But the battle plan is taking shape rapidly.
