Hostway: Revamped Channel Program Will Knock Down Barriers, Open New Doors

Hostway, a managed server and cloud hosting provider based in Chicago, has revamped its channel program with a vision of making business easier for its partners, the company's channel chief told CRN Wednesday.

The program, being rolled out in phases for different use cases, adds tiers, price discounts, more-responsive technical support, marketing assistance and free usage during customer on-boarding.

Jim Ciampaglio, vice president of channel sales at Hostway, told CRN those elements were crafted in consultation with resellers, some of which find themselves being neglected by infrastructure providers that have grown out of touch with their needs.

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The new structure "takes away barriers that resellers have from doing their job," he said.

Hostway's channel constitutes a number of telecommunications and cable companies -- large white-label resellers that deliver Hostway's services to hundreds of thousands of users. The provider of public, private and hybrid cloud, as well as Web hosting and enhanced email services, also relies on a growing network of smaller VARs, MSPs and ISVs to bring its service to market.

The reinvented program integrates those channel business models in a more holistic approach, Ciampaglio told CRN.

Ciampaglio came on board eight months ago to oversee that channel expansion. One frustration he said he has seen mounting for resellers, both in his current post and those he has held in the past, is inadequate high-level technical support.

"The infrastructure we sell is a core component of the solution, but the core product is the support that goes behind the solution," Ciampaglio told CRN.

Once they've decided on a provider to partner with, channel resellers understand the infrastructure, they've done the testing and evaluated the solutions, he said. The differentiator they're looking for is confidence that they will get immediate assistance when something goes wrong for their customers.

The new Hostway program sends customers or partners with problems immediately to Tier 2 technical support, bypassing the initial "troubleshooting" phase that often only builds frustration, according to Ciampaglio. Platinum customers those that are more technically adept and operate larger environments go directly to Tier 3 support when they contact the service center, he said.

Another way Hostway is holistically integrating its ecosystem is through a new discussion forum within its partner portal that allows partners to connect with their peers and help each other expand their solution sets.

"Partners might be strong in one particular area, not so strong in another. Partnering with another reseller might satisfy the need for that reseller," he said.

The new channel program also attempts to ease a financial burden inherent in the on-boarding process.

"A big pain point for resellers is that they start incurring costs on day one when they access the server. But they traditionally don’t start generating revenue for a couple weeks, if not a month later, when they stand up the solution for the customer," Ciampaglio told CRN. "That becomes a cost burden."

To solve that problem, Hostway has implemented a first-month-free policy. Platinum partners that have more complex transition needs will get three months free.

Mark Sharkey, owner of PrecisionPros, a Web hosting reseller based in Mesa, Ariz., told CRN Hostway listened to its partners when rebuilding its channel program.

As the middleman between the data center and the customer, PrecisonPros often needs to customize servers to meet the specifics needs of its customers while not sacrificing comprehensive technical support.

"In putting together a reseller program, Hostway realized that a cookie-cutter approach to server deployment does not always work," Sharkey told CRN via email. "With some hosting companies that we have worked with, you give up data center support if you need to make core changes to the servers."

The free migrations that Hostway offers partners, and the free one to three months of server usage, do much to alleviate the costs of on-boarding new customers said Sharkey.

"Sometimes this alone is the edge we need to win a new client over a competitor," he told CRN.

PrecisionPros also is taking advantage of the peer discussion forum.

"If we need a recommendation for a specific skill set, or advice on best practices, we have a community of like-minded business resellers to turn to," he said.

Hostway, founded in 1998, followed a somewhat familiar trajectory of an ISP that became a hosting provider, then built a cloud. It now operates six data centers in North America.

After being acquired by private equity firm Littlejohn & Co. more than a year ago, Hostway has focused on unifying its products and divisions, according to Ciampaglio.

The company's new CEO, Robert Boles, who came to Hostway from Cognizant, also implemented a major new initiative: "The company needs to be absolutely focused on growth within our channel," Ciampaglio told CRN.

PUBLISHED MAY 14, 2015