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In my previous blog posts (Part 1 and Part 2) I described how, paradoxically, increased functionality is leading to greater commoditization, and that this can be explained by the Consumption Gap: technology companies are adding functionality faster than our customers are able to absorb it.  Rather than trying to understand how all these new features could benefit them, they simply throw their hands up, decide all products are equal and choose on price.  The solution lies in services: the job of the VAR or Systems Integrator is changing from providing product to counseling the customer and creating great results. Read more to find out what Bob Dylan would have said about it.

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In my last blog I introduced the paradoxical idea that adding features and functions to networking products is actually driving them towards commoditization, rather than differentiation. This sounds like a contradiction: shouldn’t more functionality equal greater value to the customer, which should lead to better prices (or, at the very least, less discounting)? Technology is driving down costs, and customers expect to reap the benefits of that in their capital expenditure costs. But even powerful new features and functions don’t always command the price premiums they used to.  Here is why . . .

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The traditional set-up of vendors providing product, channels implementing, and support being split between them is not going to be enough in the future, because the market is changing in a number of ways.  Here is why we all have to think beyond what we have always done: customers are demanding more turnkey implementations, they are insisting on more personalized support, and they are expecting ever greater creativity from suppliers to not just fulfill their needs, but to anticipate them.  This has lots of implications . . .

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Luanne Tierney
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Worldwide Partner Marketing

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