E-commerce specialist Avangate is warning the channel that it must change if it wants to continue selling software. This is aimed at software vendors and resellers alike.

Carl Theobald, Avangate CEO, in a discussion with Jeff Barrett on how the software industry is not dying, but rather, it needs a different approach toward distribution and sales in the age of cloud computing.

Social and mobile are already set to soar according to several experts, but one more area could see skyrocketing numbers in 2013. The cloud, which helps businesses operate both social and mobile options, could see significant growth from large and small businesses throughout 2013.

With direct sales forces under heavy pressure and channel partners becoming scarcer as the reseller market undergoes shifts, a new type of distribution that encompasses both and more is emerging.

The current state of subscriptions in software is not a long-term solution, with the hype around it placing rose-colored glasses on the eyes of many businesses that directly affects their delivery and revenue models and subsequent viability.

Avangate was mentioned in the Forrester Wave™: B2C Commerce Suites, Q3 2012, Forrester Research Inc, 2012, among digital or media focused commerce solutions.

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Cloud computing is changing the relationships customers have with their vendors and partners, but according to Avangate, the next stage of evolution is under way and will continue to evolve in the coming months and years.

Software vendors must redefine the role that their channel partners will play in this new world. Empowering the channel to own the relationship with the end customer and manage renewals, upgrades, cross-sales is the right way to go.

Raj Badarinath, Director, Product Marketing at Avangate, commenting on how retailers as well as software vendors need to adapt the way they sell software in a market shifting to Cloud services and online delivery.

Still some in the market expect that a few key IaaS players will emerge over time. “There will probably be consolidation because of sheer economics,” said Carl Theobald, CEO of Avangate, an Amsterdam-based provider of e-commerce payment and transactional services. There will be a few big players that provide a higher level of service at scale — there won’t be hundreds but there won’t be just one, he said.