Ruckus over Thecus distribution deal

Johannesburg, 21 May 2010

International storage operation, Thecus Technology, has canned a deal signed only a week ago with local operation Computer Storage Services (CSSI).

CSSI released a statement last week, saying it had won the right to distribute the international company's storage devices. However, ITWeb discovered that Thecus already has a local distributor, IntelliStor, which was concerned by CSSI's announcement.

“Firstly, we were quite surprised because this is not the way that Thecus Technology Corporation operates,” says Chris Roux, MD of IntelliStor.

IntelliStor has been the company's partner since 2006.

Language barrier?

In a sudden about-face, Thecus has reneged on the deal with CSSI, saying the company was appointed because of a communication error. Thecus says communication broke down between the headquarters in Taiwan and the Austrian branch, Thecus Asguard.

Asguard branch manager Lee Liangtsai says: “The Austrian branch appointed CSSI last week as a distributor serving the South African market.”

According to Peter Sun, territory manager at Thecus, Liangtsai appointed CSSI last week. “Liangtsai did so not knowing Thecus already had an official partner, IntelliStor.”

Thecus held an internal meeting to resolve the matter. “Thecus made the decision to allow IntelliStor to remain as the official and only distributor for Thecus in SA. Asguard has been asked to stop all pending and future business with CSSI,” emphasises Sun.

“Channel management is the most important thing here and I think we got it straightened out with the conclusion of this event,” he adds.

Sun says he does not believe this issue will hurt Thecus in a negative way at all. “If anything, we've responded in a very professional manner.”

No communication

Thecus adds that it has done everything it can to resolve the confusion over the awarding of the deal as quickly as possible.

However, CSSI has not been notified that the contract has been cancelled.

CSSI says as far as it is concerned, it still has the rights to distribute Thecus storage devices, since it has not been officially informed of the cancellation of the contract. The company adds that it has not received any documentation to contradict its position as reseller.

“As far as we are concerned, we are still the channel partners for Thecus in the region,” says CSSI MD James Grcic. He adds that CSSI still has the signed agreement in hand.

Grcic also says CSSI's understanding is that Thecus in Taiwan manages the channel in Asia, while Thecus in Austria manages the EMEA region.

He notes that CSSI is still selling Thecus products, which are doing well at the moment. He adds that he wants to deal with this case professionally as it might affect his business as well as the other parties involved.

Grcic says he will meet with IntelliStor to discuss the issue. “I want us to approach this professionally. I will show IntelliStor the documents that I have signed with Thecus.”