When I was a kid, my dad ran one of the handful of electronics shops my incredibly small southern hometown could support at the time (this was early '80s - Walmart's electronics section was an aisle, not a department). As the '80s gave way to the '90s, the commoditization of TVs had taken hold, and the market was flooded with upstart no-name brands (Goldstar is the one I remember from the time; you now know them as LG) that were available at incredible prices. Unable to compete on price, the big-name legacy brands focused on quality, and then that argument began to falter. Now, the marquee brands are shells. When's the last time you saw a Magnavox? Or considered buying an RCA product? Or even remembered that Quasar existed as Panasonic's upscale cousin?
I tell that story, not because a bit of my childhood died when I learned that Quasar - the brand my dad was the exclusive outlet for in Selma, AL - is now being slapped onto cheap, third-party manufactured flatscreens, but because that same type change is happening all over electronics now as patents expire and overseas manufacturing becomes more skilled. If you read any technology news on the underpinnings of web successes like Facebook, you'll see that IT equipment is rapidly being commoditized and undercut with no-name and generic suppliers. But what's uncanny is that the concerns that plagued the early days of TV commoditization are being repeated, almost word-for-word, with these insurgent IT equipment providers.
Quality? Reliability? Service? Warranty? These are all big questions that you hear in an attempt to mitigate the appeal of much-cheaper no-name equipment, so it's again a question of price vs. quality. Here, though, quality holds a much higher place. In the '80s, if your cheap, no-name TV went out, you were out $200 and your bratty kid couldn't watch A.L.F. for a few days until you went and bought a new one. Buying off-brand or no-label IT equipment offers tremendous value opportunities, but it's much more risky than buying a cheap TV. There are quality of service questions throughout the process:
- Is your IT team capable/skilled enough to determine needs and specs to the point that they can order equipment directly from a manufcturer?
- Is the manufacturer reliable enough that you will receive the equipment that you actually ordered, and receive all of what you ordered?
- Will the equipment be reliable in the long run, or will it fail more often, increasing the TCO?
- Will your network be built robustly enough to accommodate for equipment failure, or will you need rapid replacement service from the supplier? Does the supplier offer any type of service package?
All of these are big questions right now, and are big enough to still sway purchases towards the big legacy brands like Dell and HP. So while there are tremendous cost savings available from no-label equipment manufacturers if your IT budget is large enough and your IT team skilled enough, it's still not a universal route for savings.