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By | Kat Hall 3rd June 2015 14:31

Second-hand IT alliance forms to combat 'bully' vendors

Free ICT Europe says: vive la resistance!

Second-hand IT providers have formed an alliance to combat what they claim are increasingly aggressive tactics by big vendors desperate to claw back falling revenue.

Tomas O'Leary, secretary of Free ICT Europe, and chief executive of independent provider of IBM software maintenance Origina, claimed big vendors have stepped up efforts to squeeze out second-hand IT providers.

The not-for-profit foundation's principal remit is to address what it deems to be unfair practices by original equipment manufacturers.

The most common tactics are to perform software audits on companies and crackdown on second-hand repairs as a means of maximising sales, said O'Leary. By doing so they intend to restrict the number of suppliers not directly part of their own ecosystem, he added.

"It's purely economic, they are carrying out a land-grab," he said. Many traditional vendors have recorded a loss in revenue. O'Leary singled out IBM, Cisco, HP and Oracle as being the worst offenders.

O'Leary is currently lobbying the European Commission for greater regulation and clarity on the rules governing the second-hand market. "We're in the process of deciding what the next step should be," he said.

Vendors do appear to have been been tightening their grip of software and maintenance over the last few years.

In 2013 Hewlett-Packard said it would restrict who is allowed to fix its ProLiant servers. The move means customers will need to be on a full-blown support contract to receive a service agreement ID.

Oracle has been accused of unfair competition and of breaking US anti-trust laws over its Solaris support business. In April last year fix-it company Terix claimed the database giant had undermined third party providers by forcing customers to sign with Oracle.

The software maker was also previously accused of only allowing a limited number of services-based resellers and integrators in the UK to renew maintenance agreements when they expire.

Cisco also launched an EMEA-wide crackdown in the channel, sending letters to more than 1,000 resellers, integrators and vendors in Europe, informing them they had been placed on a "Denied Partner List" preventing them from quoting Cisco kit or carrying out transactions.

However, Cisco recently announced plans to move deeper into the second-hand market itself, with the launch of its of its Cisco Refresh programme in May to "address the growing secondary market".

The second-hand market has been tough for providers, as earlier this year the biggest broker of second-hand gear Gamma Global went under.

El Reg has contacted the four IT goliaths mentioned for comment. ®

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