Another AMD master reseller moves out

There has been an increasing number of Advance Micro Devices (AMD) master resellers moving out of the distribution of its processors in India. Zeta Technologies is the 13th master reseller--said market sources--to stop distributing AMD processors about two months back. Among the earlier master resellers, there were players like Compuage, Neoteric, Aditya, Great World etc.

Sources at Zeta stated, "Low margins and favoritism towards Tech Pac was the reason we stopped dealing with AMD processors. We have been dealing with AMD right from the beginning and it was not fair towards us." He added, "Tech Pac was doing the rupee billing for Hagemeyer in India. At the same time Priya, Abacus and Zeta were doing the same for Avnet Max."

When contacted, Sanjeev Keskar, Country Manager (India), AMD, said, "We cannot comment upon this as master resellers are not appointed by AMD. We have three distributors for India--Avnet, Tech Pac and Intraco--with whom we have distribution agreements. Our channel numbers have grown quarter on quarter for past several quarters which shows that our channel strategy and channel programs are well accepted by resellers and system integrators and it also underlines the fact that AMD products offer a good business proposition."

Even Mumbai-based distributor Tech Pac did not have much to add. "Master reseller is the term used to refer to in country re-distributors of AMD CPUs who source their products from Avnet who do not have in country operations. Zeta was a master reseller who was sourcing AMD from Avnet. However, the reasons for the break up are not known to us," pointed out K Jaishankar, CEO, Tech Pacific India.

On attaining profitability on AMD products, he added, "Tech Pac is competitive on its price offering to channel partners as it is an expectation that they have from us. However, we provide various opportunities for our partners to optimize the profitability of the business by dealing with Tech Pac. This can be done by reducing operation costs by leveraging our value added services such as door delivery, drop shipment etc."

Jayesh Sheth, MD of Great World, one of the earlier master resellers of AMD, said, "We had moved out mainly because the management model had changed and Tech Pac had been appointed. Therefore our role was getting eliminated and margins are not low only with AMD as it's there in the IT channel in all products."

Channel sources also added that the earlier master resellers moved out because many of them were involved in gray market dealing of AMD processors, selling at low costs thereby causing low margins to others. An insider close to AMD added, "The reason given by master resellers that there was favoritism showed towards distis like Tech Pac is baseless. This is mainly there is a difference between a master reseller and a distributor."

Nancy Sudheer