EMC re-architects its channel program

LAS VEGAS – The channel is about to find out that EMC Corp. has strength in numbers. Those numbers being its federation companies VMware, RSA, EMC II (Information Infrastructure) and Pivotal. And you can throwVCE and the newly acquired DSSD into that mix as well.

At EMC World, the company introduced a brand new channel program called the EMC Business Partner Program that will harness the power of its partnerships, incent channel partners to take packaged solutions to market in a repeatable, programmatic ways, take into account a solution provider’s investments, and maybe more importantly, enable partners to stack rebates from all federation channel programs. The program gets its official launch on Jan. 1, 2015.

Fred Kohout, the vice president worldwide channel marketing at EMC, told CDN that the new EMC Business Partner Program has been re-architected for a new ecosystem of partners. The program has been built with a common framework with a rewards section that increases for partners who are able to go deep and broad with EMC.

The EMC Business Partner Program creates links with EMC federation companies Pivotal, VMware, RSA and will also include the VCE alliance that includes Cisco Systems along with VMware.

“We’ve put everything under one brand. The idea with the common framework is to pick the track that best fits them as the channel has multiple models. How do you reward them? So they can be in multiple tracks and can share the benefits across these tracks. This will lower their costs, provides flexibility and choice,” Kohout said.

This new program will also bring to the channel for the first time EMC services tools and methodologies that support federation-built solutions.

Paul Edwards, senior channel analyst for IDC Canada, told CDN that EMC has to consciously ensure that solution provider partners are not stuck in the 2nd platform and this new channel program may incent them to do so.

“EMC is shaking the channel out of its legacy behaviour and pushing them to engage with all aspects of its federation and other parts of the portfolio,” Edwards said.

Fred Kohout of EMC
Fred Kohout of EMC

Kohout added that the EMC Business Partner Program will feature three tiers: silver, gold and platinum. Each tier will have a minimum clip level that will adhere to regional market sizes. Kohout told CDN that EMC Canada’s channel team is authorized to tweak the program for the channel partners in Canada and the market opportunities in the country.

EMC does not disclose clip level or rebate margin details, but he described them as significantly higher than in previous programs.

There is no global set of thresholds for the three tiers. How it will work is that EMC and the channel partner will work together on a forecast. From there a quota will be agreed on and the goal is for the solution provider to sell solutions involving hardware, software and services to retire that goal. This system will see solution providers earn reward dollars from the first dollar sold, Kohout said.

The EMC Business Partner Program will have a deal registration area on the resale side that will have rebates tied to it. There will also be a portion of the program focused on distributors who can enable and support the new ecosystem of partners for EMC.

“They have to be profitable because as they invest with us they need to increase profits and the new program has been constructed to reflect that,” Kohout said.

Edwards said that he can see partners being concerned that they now have to focus on others parts of EMC that they are not comfortable with. “EMC’s future will be based on the success with transforming its legacy channel down this path,” he said.

According to Kohout, channel partner models are changing and have become more fluid in EMC’s estimation.

“The channel distinctions are vaporizing. Before there were hard lines in the channel. That’s changing. You have companies who are VARs, cloud service providers, and integrators and they’ve become fluid engagements today,” he said.

Under the EMC Business Partner Program, how a solution provider makes money is by driving the value chain, sell solutions with services, and invest deeply with EMC, Kohout said.

The program has been architected to push solution providers up through the tiers. Solution providers get rewards as they grow. Each tier has richer rewards, Kohout said and channel investments are essentially matched by EMC.

Steve White, a market analyst for IDC, called the EMC Business Partner Program “a big deal” from an EMC historical perspective. He told CDN that fact EMC will be rewarding channel partners on dollar one of sales is something the company has never done before in its history. “This program makes sense. If I’m a partner and I have already cleared a few hurdles to start selling then why do I have to clear more hurdles just to get paid?” White said.

EMC is also building a joint development centre for channel partners in Bangalore and that too will be part of the EMC Business Partner Program.

“We looked at what’s happening in the industry with the channel and we needed a partner program that comprehends and addresses the unique elements of the partner community today,” Kohout said.

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Paolo Del Nibletto
Paolo Del Nibletto
Former editor of Computer Dealer News, covering Canada's IT channel community.

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