Virtual Iron Inks Distribution Deal with Tech Data

Published: July 10, 2007

by Timothy Prickett Morgan

Server virtualization software maker Virtual Iron is lining up to do battle against its rival, VMware, by inking a distribution agreement with IT reseller Tech Data. VMware has previously allied itself with Ingram Micro, which distributes its ESX Server and related products.

According to Mike Grandinetti, chief marketing officer at Virtual Iron, Ingram Micro was keen on peddling Virtual Iron's server virtualization alongside of VMware's products, but after assessing its options, Virtual Iron decided against it. "We felt that we would rather work with a company that had no direct relationship with VMware," he says.

Finding such a company is a bit of a challenge, but Tech Data, which had $21.4 billion in sales its last fiscal year and which has more than 90,000 customers in over 100 countries, fit the bill and has the pull with the small and medium business market as well as in the enterprise space to potentially push a lot of Virtual Iron software. Tech Data's Advanced Infrastructure Solutions (AIS) division, which was established this February, will resell Virtual Iron in North America. AIS distributes various servers and related technologies, mostly from Hewlett-Packard and IBM. More importantly, by inking a deal with Tech Data, Virtual Iron expands its reseller channel from the 170 partners it has signed up around the globe so far to over 500 partners. The size of its channel and its marketing might is important, since Virtual Iron only sells through resellers; it does not have a direct sales force.

Incidentally, Tech Data does indirectly distribute VMware hypervisors and related system management tools, making use of existing partnerships between VMware and HP or IBM.

In the long run, of course, Virtual Iron will probably be keen on having its server virtualization tools sold by any distributor or reseller that is interested in peddling its products. And, if it gets strong enough, it may even carve out some corporate or government accounts to sell directly to rather than forcing key customers to go through the channel. Channel strategies change as companies and the conditions in which they operate change. With Ingram Micro having $31.3 billion in sales in 2006, and a network of 165,000 resellers in over 100 countries, no one can afford to ignore the company.

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