Arrow Empowers Partners To Peddle Converged Systems, Eats Another IT Recycler

October 29, 2012 Timothy Prickett Morgan

It would be a good thing for IBM to be able to have the full focus of a master distributor such as Arrow Electronics when it introduces a new technology such as the PureFlex modular systems. But the master distributors are just that: The main conduits that buffer the server makers from the capriciousness of the IT buyers and lets them all get product into a vast distribution channel and essentially outsource the sales job to all but the largest accounts. In exchange for that service, companies like IBM have to share the attentions of Arrow and give them the best deals and technology they can muster.

Arrow launched a co-marketing program with upstream vendors and downstream partners to help them both do a better job peddling their converged boxes, which put servers, storage, switching, and management software all in a pre-configured setup that is easier to buy, install, and manage than piece parts from multiple vendors. This program, called Empower, was launched in North America and was specifically designed to assist in the sales of IBM’s PureFlex, Oracle‘s Exadata and Database Appliance, Vblock mashups of switches and servers from Cisco Systems and storage from EMC and sold through its Virtual Computing Environment (VCE) partnership, and Hewlett-Packard CloudSystem.

The Empower was last week boosted with more comprehensive training, solution scoping and architecting, live or virtual proof-of-concepts, configuration help, and post-sales implementation assistance for partners peddling these products. The exact feeds and speeds of these enhancements are available here, and I would just love to know what Arrow says as it positions these different converged systems against each other. That would be some fascinating reading, indeed.

In a separate announcement, Arrow said that it had acquired a company called Redemtech, a subsidiary of a conglomerate called Micro Electronics, that specializes in IT asset recovery and disposal, which for some reason is abbreviated ITAD instead of ITARD. (Well, I guess we can see why that happened, now can’t we?) Redemtech is based in Columbus, Ohio, and has around 400 employees and 2012 sales that will be on the order of $60 million, according to Arrow.

What Arrow did not say, but which IDC analyst David Daoud did in a research note, is that this is the fourth ITAD vendor that Arrow has picked up after acquiring Intechra, TechTurn, and Converge already.

That means Arrow is now the third largest provider of ITAD services among those providing these services in the United States, according to surveys of the IT community done by IDC. Dell is apparently the leader with a 38 percent share of this market, about 10 points ahead of Arrow with its 28 percent share. IBM has more ITAD biz than Arrow, and Hewlett-Packard a little less. If revenue is proportional to market share (and I am not saying that it necessarily has to be), then this market should generate somewhere on the order of $750 million in the United States alone and Arrow should have somewhere on the order of $200 million of that now.