Westcon Acquires Cloud Distribution Platform Developer Verecloud

Westcon Group Thursday acquired cloud distribution platform developer Verecloud in a move aimed at further solidifying its cloud strategy.

Terms of the deal were not disclosed.

Verecloud, which was founded in 2006, will act as Westcon's foundation for cloud distribution via its cloud aggregation and brokerage platform. Verecloud's cloud and services distribution platform capabilities include a cloud and services offering catalog, including bundles and stand-alone offerings; solution bundling; white-label-branded solutions; automated life cycle and more. Westcon said it is building channel enablement services around the Verecloud offering, including billing-as-a-service, upselling, marketing, legal contracts, sales enablement and technical support.

[RELATED: Exclusive: Westcon CEO Says Company Shifts And Investments Are Paying Off]

The two companies have worked together for 18 months, with a pilot launch going live as part of an effort earlier this year in New Zealand with eight vendors and a dozen resellers. Now that the acquisition is complete, partners can look forward to a more formal launch, said Westcon CEO Dolph Westerbos.

Alistair Ross, national services manager for Cyclone, one of the New Zealand resellers who participated in the pilot program with Verecloud, said that after seeing the two companies work together first-hand, it will be a great fit going forward.

’Cyclone believes that this new platform offers our customers a new level of ease and flexibility to deploy the cloud services through Westcon Group’s growing channel cloud platform catalog," Ross said.

Using the platform, Westcon can deliver cloud and services solutions to solution providers, with the option for them to white-label all the offerings, Westerbos told CRN.

Verecloud has distinguished itself as able to handle a multitiered channel industry with white-labeling at every level, billing, and monitoring for feedback to both vendors and resellers, said Westerbos. Those factors make having Verecloud exclusively available for Westcon a "complete differentiator," he said. However, that differentiation doesn't come without risk, according to Westerbos, as Westcon strides into what it says is new territory for the industry.

"The fact that no one has yet cracked the mold is because it's not easy. This level of granular transaction-based and billing and monitoring and adjusting, that’s really complex stuff," Westerbos said. "I think we will be a very early leader in this space. I think we will be the broadest provider in this space, but we're having to make that model and create it. It's not without risks. If we're not taking a step now we're not creating the solution of tomorrow."

The Tarrytown, N.Y.-based distributor's strength is bringing key solutions down through solution providers to end users, instead of changing course and building the solutions itself, he said.

"That’s a big part of our strategy in cloud. We're not necessarily looking to be our own service provider; for us that’s not our strategy. We think that will compete with some of our customers and it’s a very different skill set," Westerbos said.

Instead, Westerbos said Westcon's cloud strategy will involve adding sales enablement, training and more to help solution providers transition to a recurring revenue model around the cloud.

"I don’t think this is a space for followers. No one has figured out go-to-market in the cloud. ... End customers are not looking to buy point solutions but are looking for one stop for a multitude of solutions. There isn’t really a compelling model that works yet. It's still in flux and the need is there," Westerbos said. "I think we need to lead this. We're making very serious investments and I think Westcon has a responsibility to play here to help the traditional vendors and resellers transition to cloud."

Ron Renjilian, CEO of Verecloud partner Cloud Wrangler, said the Verecloud solution helped launch his cloud business from the ground up. Now that the vendor is part of Westcon, Renjilian said he expects enhanced benefits as Westcon adds "domain expertise and resources" on top of the platform.

’Verecloud helped me launch my cloud services business from ground zero; now as part of Westcon we can take our business into hyperdrive," Renjilian said.

PUBLISHED SEPT. 4, 2014