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EMC Issues Channel Ultimatum

EMC-no-tag_blue_RGB[1]Editor’s note: This article was previously published on Channelnomics.

EMC has declared it is not interested in working with solution providers that are not flogging huge volumes of its kit, and admitted its divisive new partner program was designed to force their hand.

Last year the storage giant announced it was axing its Velocity partner scheme in favor of a new Business Partner Program (BPP).

As part of the new framework — which will come fully into force in January 2015, although BPP branding is currently in play — EMC is set to slap eye-watering sales targets on its partners. To achieve top-level Platinum status on the new program, partners must sell $65 million worth of EMC kit in a year, $15 million to reach Gold and $1.25 million for lowest-level Silver.

On the old scheme, no revenue requirements were in place, meaning some resellers currently at top-level Signature status will face being thrown to the bottom of the pile next year.

Dividing Opinion

EMC’s EMEA channel boss Phillippe Fosse admitted resellers’ feedback had been divided. He said top-selling partners set to achieve Gold status have been so pleased with the move to make the channel more exclusive that they have even suggested raising the threshold to $20 million, but added that small- and medium-size partners have been split down the middle.

“Half are happy and half are not happy,” Fosse said. “But we’re telling them that they need to make a choice. By placing the thresholds we are being more selective than we have been before.

“We are forcing you, Mr. Reseller, to make a choice: You either believe in EMC and place your bets like we do… or you continue to do $3 million with EMC, $4 million with HP, $2 million with IBM, $5 million with HDS and God knows who else. Those associated with multiple brands have a huge cost associated with that.

“You will be a player of many vendors but you won’t be important to any vendor. We are forcing you to make a choice: you either play big with EMC or you don’t.”

Fosse said he expects EMC’s new attitude to prompt some VARs to cease selling EMC kit but said quality is more important to EMC than quantity.

He added that the general rule for most vendors EMC size was that 80% of business comes from 20% of partners, meaning fewer partners is not necessarily a bad thing.

“It’s not judgement, it’s purely mathematical,” he said. “Therefore [we] will do more with fewer partners.”

Getting Distributors On Board

Fosse said he had been working with EMC’s Global Channel Chief Gregg Ambulos over the last week on a new BPP program especially for its distributor partners.

While he could not give away too many details about the new scheme — which is set to come into force on September 1, 2014 — he laid out its general structure.

“I can tell you we’re going to divide the role of the distributor into three categories,” Fosse said. “One will be basic, doing things like logistics, finance and stocking. [The next tier up] will focus on partner management, including extended channel organisation and managing partners [and top level] will be a recruitment engine, driving new technology or expanding into new markets.”



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