CRN: Apple's Growth Brings Frustration and Halos to Channel Partners

by , 1:10 PM EDT, July 30th, 2007

Apple's explosive growth has been generating frustration amongst some of its channel partners. Others, however, have seen a halo effect, according to CRN News on Monday.

Apple has continued to open retail stores, and the sales in those stores is growing according to Apple's recent earnings report. Those stores serve about 22 million customers each quarter. That's great news for Apple, but for some channel partners, it can create a problem.

"It's adversarial," said George Blakely, owner and manager of MacHeads in Lancaster, Pa., an Apple solution provider and channel partner. "Apple would like to sell everything themselves. They keep opening more and more retail locations. They want to drive business to their own stores. They offer deals there that they don't extend to (the channel)." As a result, Mr. Blalely sees each store that Apple opens as potentially putting another solution provider out of business.

Some others are annoyed that Apple chose to keep iPhone sales to themselves.

In the education sector, Apple has been dealing directly with many customers. When sales were more modest, it didn't matter. Once again, however, Apple's growth is leaving some channel partners behind. "Obviously, it's harder than it used to be," said Bob Young Jr., president of ComputerTree, a solution provider and Apple channel partner in Winston-Salem N.C.

In other ways, however, Apple's sea change is floating other boats. Mr. Young noted that Apple's strength and sales have generated a halo effect, and many Windows customers have come into ask about Macs. However, he also noted his disappointment in being left out of the iPhone sales.

Apple is a company that has a unique ability to reach out and connect with customers. As Apple continues to be successful, channel partners will likely always have a mix of conflict and halos. How the channel partners avoid conflict and cash in on the halos will likely remain a key component of their success.