TDS will open up the application service provider (ASP) model to the indirect channel by using resellers rather than a direct sales force to spearhead its drive to become a leading figure in the UK.
The German company, which set up office in the UK in 1998, is expected to recruit its first reseller in the next couple of months.
Tim Foxlow, managing director of TDS UK, said the ASP is courting consulting resellers and enterprise resource planning resellers to ensure it is the first "true ASP" to market. TDS has been renting applications through networks for more than 25 years.
Foxlow said an indirect channel will allow TDS to go to market quickly and to focus on its core business rather than building a huge sales force. In return, resellers can forego the huge start up costs related to entry into the ASP market.
"We have to move quickly with this model. Application service provision is going to evolve as we move through. The ASP model lends itself to the small and medium-sized business market as well as the enterprise space. Working with resellers is the best way to move forward," said Foxlow.
He said TDS wants its channel in place by June. "By the second quarter of this year, we have to have the partners that we are going to work with in place. We will ramp up quickly, then be more controlled," he added.
Foxlow acknowledged that TDS needs to address how best to compensate resellers for the disappearance of turnover normally derived from software sales, but said it is considering giving resellers a percentage of the rental proceeds. This will translate into more income from software over three to five years, he claimed.
Foxlow said TDS is running seminars with SAP and Sun Microsystems to educate resellers about ASPs. He predicted that the ASP market - which he claimed was mainly hype at the moment - will kick off by September. "This market will fly by the third or fourth quarter. It will come from small and medium-sized businesses, from enterprises, from the entire industry and it will change the way resellers do business," he said.
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