Patrick Lo, chairman and CEO, Netgear talks exclusively to Dqchannels on why and how the company is pushing for channel development in India
“In 3 years, 50% of our India business should come from the commercial side” PATRICK LO, chairman and CEO, Netgear
Netgear has been looking at developing its channel in India for sometime now. What is driving this increased focus on channels?
We are by now well established in India as a consumer brand, especially in tier-1 cities. We are trying to leverage this brand equity on the consumer side now to grow on the commercial side. We will be able to address SMBs through resellers and SIs only and therefore the need to develop the channel. We are building various channel programs for this purpose. In Asia, generally our revenue split between consumer and commercial sides of the business is 50-50 and we aim to achieve this in India too in 3 years time.
What has been the success rate of this channel development drive till date in terms of getting partners on board? How has Netgear fared in the India market in past year in terms of partner business and customer numbers?
We currently have Ingram Micro and Rashi Peripherals as our national distributors; together they address close to 1,000 partners in the country. This fiscal, the company will spread its footprints to the top 40 cities, up from the top eight cities and some B- and C-class cities last year. We already have a strong presence in Chennai, Hyderabad, Bengaluru, Mumbai and Delhi and have at least 40 to 50 partners in each of these metro locations. We do have some direct connect with partners in tier-2 cities and some of the major city SIs have connect with the smaller companies too. We plan to have 20-30 SIs across eight tier-1 cities and 25 sub-distributors throughout the country.
There are established brands like Cisco in networking and those like D-Link strongly entrenched with SMBs. In this scenario, what benefits are you offering to your partners especially in a price sensitive market?
It is true we have better developed channel programs in North America and Europe, but we plan to implement the same gradually in India. The most important aspect is to protect our partners’ margins. We have a true deal registration in place wherein we treat every deal on the partner portal as a secret. In case of companies like Cisco and HP, many partners are involved in the during the bid, and often these vendors bid directly. In case of Netgear, one deal per partner is sacrosanct.
In terms of product differentiation, what are Netgear’s plans vis-a-vis emerging technologies?
We are the #1 NAS provider in the SMB segment that started supporting virtualization. In cloud computing, we have introduced the unified storage that would enable our channel partners to provide cloud services to our customers and will let our them build their own private cloud. With the introduction of the ReadySHARE Cloud, we are enabling our customers to access their data from any mobile platform.We are investing a lot in wireless LAN and have a skilled team that is building a next generation wireless LAN controller coupled with our security appliances, which would accommodate the concept of Bring Your Own Device (BYOD).
What are the product expansion plans in India in order to address increasing opportunities amongst SMBs?
Netgear in India is focusing on its SMART IT vision which envisages a reliable, affordable and simple range of products covering the entire infrastructure needs of SMBs, encompassing switching, storage, wireless and security solutions and we foresee huge growth in this field. We already have home and prosumer product business in wireless routing, including 802.11AC routers, ReadyNAS storage, and security hardware products like UTM and VPN. We have now forayed into service providing with 3G products and Wi-Fi equipment.
With these wide array of product lines, we can surely address the requirements of every aspiring SMB company in India. Our products are technically competent, rightly priced, and easy to use that provides much more compelling value proposition to the consumers. We want to see ourselves as leaders in home and retail segment, commercial space, and service providers sector. In India, the initial focus was on low-end market but now the company is having very ambitious plans to expand heavily into the mid-market.