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January 4, 2013
The Rise of a New Ecosystem
Surface Tension   


In our third quarter 2012 Global MW IT Index® report, valuations for companies in the U.S. IT Supply Chain industry decreased 23.3% between April 1 and November 30, 2012 - an unprecedented drop, even for a mature market segment.


As we have written before, one driver of this decline in valuations is Microsoft's decision to build and sell hardware direct to customers for the first time in its history, starting with the Surface tablet. This has, of course, caused major disruption in the Wintel partner network.

Some have argued that the Wintel ecosystem is the last of its kind - a partnership that created and sustained growth in sales, profits and value for thousands of companies for several decades.


We disagree. We believe that we are witnessing the birth of a new IT ecosystem that has the potential to surpass it: Amazon Web Services.


Amazon doesn't reveal much about AWS's size or performance, but some analysts expected total revenue last year to reach $2 billion and grow 45% or more during the next five-plus years. That would make AWS a $20 billion business by 2018.


There are three major reasons why AWS could lead the next major IT ecosystem:

  1.  Amazon has already proven that it can build and manage a large and complex ecosystem in its retail business.
  2. Comments from Amazon executives, including CEO Jeff Bezos, have made it clear that their formula is to offer initial services at low cost and profit only through customer use - which opens doors for partners.
  3. Amazon understands that a key to its success is to build and nurture a strong ecosystem.

Some recent moves by Amazon, such as the AWS Marketplace, show Amazon is willing to move up the stack itself - which could displace some of its existing partners.


But it will be a very long time, if ever, before Amazon blows up its partner network like Microsoft did in 2012.

The emerging AWS ecosystem was the subject of an article written by Marty Wolf and recently published in CRN. To read it, click here.

To learn more about martinwolf contact Matthew Putzulu at  

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With offices in San Francisco and Bangalore, India, martinwolf is a leading middle market M&A Advisory focused on companies with IT services-based business models. Since 1997, our team has completed more than 115 transactions in six countries. We are a five-year member of the Merrill Lynch PS Referral Network, and were selected as ICICI Bank's (India's leading private bank) exclusive strategic partner for acquiring U.S. IT companies. martinwolf is a member of FINRA and SIPC. For more information, visit


Featured Transactions


November 6, 2012

Rolta, through its subsidiary Rolta International, Inc. announced that it acquired AdvizeX Technologies, LLC, a US company providing a comprehensive set of IT products and services ranging from roadmap planning to cloud-computing implementation strategy. With the acquisition, Rolta is now one of the top national partners of Oracle, Microsoft, HP, EMC and VMware in the US. Rolta was represented by martinwolf in the transaction. 

Please click here to view the announcement.


June 15, 2012

glendonTodd Capital LLC announced that it acquired Aztec Systems, a leading provider of enterprise technology solutions to hundreds of U.S. middle-market companies. Aztec was represented by martinwolf in this transaction. Aztec, a member of Microsoft's Presidents Club, was recently ranked 27th in revenue on Bob Scott's 2012 Top 100 VARS list and serves more than 700 middle-market clients. Terms of the transaction were not disclosed. Please click here to view the announcement.


December 1, 2011

Softchoice Corporation (TSX: SO) announced it has it has fulfilled its regulatory requirements under the Competition Act and has now completed the acquisition of substantially all of the assets of UNIS LUMIN, one of Canada's most highly regarded Cisco networking and managed services companies. Softchoice was represented by martinwolf. The acquisition strengthens Softchoice's professional services capabilities while providing the technology foundation to support the Company's future cloud offerings.

Please click here to view the announcement.   



© martinwolf 2013

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"The successful cloud play requires an ecosystem of partners and collaboration to tie services together 

and make an environment 



- Amazon CTO Werner Vogels