Cisco VAR case signals changes to come

In an with ChannelWeb, a Cisco executive said that the company doesn't believe the case has any implications for the contracts it has with other resellers.

However, the suit "portends the shape of things to come for Cisco," said Zeus Kerravala, an analyst with Yankee Group. Because the breadth of Cisco's product portfolio has grown so large, Cisco has been trying to encourage smaller value added resellers to specialize in certain areas, rather than try to sell all products, Kerravala said. "Not all VARs mind," he said. But some are used to being a one-stop shop for their customers and they don't want to specialize.

Infra-Comm alleges that Cisco said it was too small to handle the deal with The Irvine Company.

Large enterprise users of Cisco gear may not notice these changes in the reseller environment but smaller companies that tend to do business with smaller regional VARs might, Kerravala said. If VARs end up being forced to specialize in certain products, those smaller businesses might have to buy some products from larger VARs and that might mean higher prices for the end users, he said.

In addition, some of the larger VARs like Hewlett-Packard and EDS aren't designed to or particularly interested in catering to smaller businesses, Kerravala said, which could make buying more difficult for those smaller businesses.