It’s easiest to describe the two extremes with the understanding that lot’s of intermediate models exist.

On the one hand, you have physical distribution of enterprise software on a CD supported by a channel that provides complementary manual services in order to deliver a more complete solution.

On the other hand, you have electronic distribution of SaaS/Cloud applications over the network supported by channels that provide complementary online services and applications in order to deliver a more complete solution.

Since the channel services are essentially information goods, they can be delivered over the network instead of in person, and if the services are highly standardized they can be delivered as SaaS/Cloud applications in their own right. PaaS is essential for the latter, in order to sew all these applications together.

Consider the purchase and integration two systems: CRM and support in the old school software channel model vs. the new network channel model. The network channel partner provides online purchase through a reseller relationship, an integration-as-a-service offering that connects the CRM and support systems out of the box, and online on-boarding support and training (the integration as a service product would be the PaaS element and is by far the highest value added by the channel partner).

Another good SaaS-centric example is the GoodData / Zendesk relationship.

Where GoodData is distributing its BI solution via Zendesk.

Hope this helps,

Joel

What is the actual definition of the “channel” in “the network in the channel” versus the Channel partners? I’m thinking aloud about someone asking me when I whip out your neat phrase, and I’m not clear about a simple explanation?