Partners Say Cisco's MaintenanceNet Acquisition Creates Competitive Advantage, More 'Stickiness'

Partners said Cisco's purchase of MaintenanceNet is going to add more stickiness, increase renewal rates and give the channel community a leg up against competitors who will no longer be able to use the service.

"We now have MaintenanceNet as a competitive advantage, and can continue to grow and expand using that functionality," said Kent MacDonald, vice president of converged infrastructure and network services at Long View Systems, a Calgary, Alberta-based solution provider and Gold Cisco partner. "Bringing it into the Cisco family will only make it more Cisco-centric and more applicable to the partners."

The San Jose, Calif.-based networking giant recently closed its $139 million acquisition of MaintenanceNet, a developer of cloud-based solutions for handling renewals for channel partners, with plans to drive adoption and renewal services for the channel, said CEO Chuck Robbins in a recent interview with CRN.

[Related: Cisco's Hyper-Converged Strategy Is To Partner, Not Acquire, Says CEO Chuck Robbins]

"As we think about our move into software with our partners, and our move into recurring revenue with our partners, one of the key things we need to do is to build up the operational capabilities to ensure that, together, we can drive the appropriate adoption and renewal services so that all of us can maintain an ongoing profitable business," said Robbins. "MaintenanceNet [was bought] so that they could actually accelerate the infrastructure that we need to help our partners build out those capabilities as well."

MaintenanceNet, which Cisco has been working with since 2009, provides technology for automating renewal contracts for the channel. The company will become part of Cisco's Global Customer Success organization to aid partners in simplifying and digitizing businesses processes.

Cisco told CRN that other vendors who work with MaintenanceNet will need to consider finding "alternative options" as the company will use it for its own and its partners' use.

Partners said acquiring MaintenanceNet instead of contracting them makes sense and will help creating stickiness in customers.

"The whole maintenance renewal piece is a part of our business and it's part of what helps us keep sticky with the customer, and we're always trying to find more creative ways to add more value around the maintenance piece," said Ethan Simmons, vice president, East, for Lumenate, a Cisco partner based in Dallas.

"I'm hopeful the MaintenanceNet acquisition lets us be more profitable in our maintenance business but also gives us ways to be more sticky with our customers," he said.

Solution providers said some Cisco partners need to improve practices built around going after renewals, which is where MaintenanceNet could fill the gap.

"It's giving partners more tools to drive efficiently and automate our processes of maintaining renewals so we can keep our maintenance more current with our customers," said MacDonald.

Debbie Dunnam, Cisco's senior vice president for global customer success, is leading the integration of MaintenanceNet into Cisco, with hopes of utilizing the technology to help partners as soon as possible.

"I think that as fast as [Dunnam] can push it, the partners will see benefits from it," said Robbins.

PUBLISHED AUG. 14, 2015