Kathy Gibson is at Techscape 2022 – Artificial intelligence (AI), cybersecurity, cloud and the hybrid workplace are among the many opportunities that IT resellers should be prepared to seize in the coming year.
This is the word from Tim Humphreys-Davies, CEO of Pinnacle, speaking to 300 delegates attending Pinnacle Techscape this week.
He points out that the IT landscape has seen some significant shifts over the last two years: although data centre systems have experienced flat growth, sales in enterprise software, devices, IT services and communication services have all grown.
On the huge increase in device sales, Humphreys-Davies points to IDC figures which show that South African sales of devices were 1 505 639 in 2019, 1299 920 in 2020 and a massive 2 177 351 in 2021.
“This reflects how the end user device sales skyrocketed in this period,” he says. “And we think it will be an opportunity for a while still.”
But devices are just the tip of the iceberg, Humphreys-Davies says. There are many opportunities for the IT industry over the coming years as digitalisation becomes more important for all organisations.
New opportunities
Workplace trends are driving many of the opportunities. Indeed, as many organisations set up hybrid working, they are looking to equip both the office and their workers’ homes with fast, connected and secure systems.
With loadshedding back, and expected to remain for the next few years, resellers are also seeing opportunities in helping customers to mitigate power outages with UPSs, inverters and other power solutions.
Cloud computing has become mainstream over the last two years, a trend that has been accelerated by working from home and hybrid working, and Humphreys-Davies believes it will continue to grow in relevance.
Pinnacle offers the Huawei public cloud, and is looking to set up its own private cloud in the coming months.
Hybrid working and the growing move to cloud has also served to highlight the growing cybersecurity risks, and drive new technologies to counter it.
“Pinnacle launched its cybersecurity solutions division almost a year ago,” Humphreys-Davies says. “We offer solutions from Guardicore, Comodo and Stormshield.”
Artificial intelligence
Pinnacle believes there is a growing role for artificial intelligence (AI) in the cybersecurity field, even as it grows in importance throughout the industry.
To this end, Humphreys-Davies is excited about the distributor’s relationship with Nvidia, which came about when the chip-maker bought Mellanox.
“Nvidia is tagged as the next trillion-dollar company,” he says. “It is the 10th largest company in the world by market cap. And its technology powers 66% of the top 500 supercomputers.”
Nvidia is also a strong contender in the data centre AI market. “We think Nvidia is driving an explosion in AI, and is pioneering the accelerated data centre.”
Pinnacle aims to become the flagship value-added distributor for Africa for Nvidia, Humphreys-Davies says.
Online commerce
It’s no secret that online spending took off during the Covid-19 era. “And the growth in online shopping is predicted to accelerate,” Humphreys-Davies says. “Going forward, retailers are focusing on omnichannel shopping experiences.”
Interestingly, electronics and fashion are the most popular categories for online spend, so the IT industry is well positioned to maximise opportunities in this space.
In 2019, online sales in South Africa totalled $3-billion, a figure that saw robust 12% growth over the last year. This rapid growth is expected to continue, at about 9% a year.
Indeed, Takealot has seen sales rise from $318-million in 2019, $382-million in 2020 and $606-million in 2021, demonstrating how quickly this market is growing.
“Online commerce is a big opportunity for all of us,” Humphreys-Davies says. “And it’s something we realised we had to invest in.”
During lockdown Pinnacle not only migrated its ERP system to Sage X3, it also built an e-commerce platform based on Magenta, for its reseller customers.
“We now offer a full back-to-back e-commerce web site. In future we will add functionality like white-labelling and delivery direct to customer.”
The Pinnacle vertical companies, DataNet and PinnSec are also online.
The e-commerce portal has proved popular with customers, with 3 048 resellers and 1405 users already signed up to buy the 4 245 products listed on the portal.
“The platform has been very solid for us, and there is a lot of integration we can do,” Humphreys-Davies says. “It is growing well.”
Alongside the online portal, Pinnacle has also become an electronic software distributor for Microsoft 365, which makes it quicker and more efficient for partners to get product keys.
Sustainabillty
The IT industry can’t ignore the challenges and opportunities of sustainability ahead.
“Sustainability is a big global issue, and there is a focus on green dollars,” Humphreys-Davies points out. “And there is a lot of technology behind all these sustainability initiatives.”
He explains that the extended producer responsibility (EPR) legislation has now been signed into law, which makes the producer of a product responsible for the products they place in the market, which extends to the post-consumer stage.
“It is about implementing a circular economy,” Humphreys-Davies says.
There are opportunities for resellers in replenishment and recycling, and Pinnacle will help them to fulfil these functions.
“The vendors will drive EPR, but on the ground waste prevention will become our job. We need resellers to allow us to implement a mandatory takeback at the point where they are replenishing.”