Bay scheme creates Var free-for-all

Bay Networks' effort to bolster its reseller programme has raised fears over decreasing margins and increased competition, as all partners are now entitled to sell across the vendors' full product range.

Under the latest incarnation of its strategy, Bay has done away with its hard segmentation policy which previously only allowed a certain number of resellers to sell its high-end ATM products.

Nick Pegley, director of worldwide channel marketing at Bay, said: 'To make the programme simple we have introduced soft segmentation which will make more products available to more partners and give them a price advantage.'

But Charlie Stewart, European sales director at Ilion, said: 'I think there will be problems but Bay is trying to be realistic with this programme.' He added: 'If Bay can manage the resellers going into a deal there will be less conflict.'

An industry source said customers were in danger of losing out on support because more resellers had greater access to products, some of which might not have the same level of expertise as Enterprise Solution Partners (ESPs).

'It will become more like box shifting,' she said. 'Distributors will sell to anyone, and the more high-end the better because that's where the margin is.'

Mark Hyland, UK channel Var manager at Bay, said it had about 30 resellers or ESPs at the top level that sold directly into corporates.

However, a source said: 'It is quite intense in the high-end area and if this is opened up, margins will diminish.'

Through the business partner programme, which will roll out on 1 March, Bay is also attempting to address criticism that it failed to provide enough marketing and strong branding for its resellers.

Hyland said: 'The branding will help the fact that there was not a strong message within the programme.'