EMC to channel: Go hard or go home

Bullish vendor admits controversial new partner programme was designed to get resellers to up their game

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

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

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

Under the old scheme, no revenue requirements were in place, leaving some resellers currently at the top Signature level facing being thrown to the bottom of the pile next year.

Dividing opinion

EMC's EMEA channel boss Phillippe Fosse admitted channel 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 $20m, but added that small and medium-sized partners have been split down the middle.

"Half are happy and half are not happy," he 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 $3m with EMC, $4m with HP, $2m with IBM, $5m 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 its 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 was that 80 per cent of business comes from 20 per cent of partners, meaning fewer partners is not necessarily a bad thing.

"It's not judgment, it's purely mathematical," he said. "Therefore [we] will do more with fewer partners."

But he was keen to stress that betting on fewer partners does not mean EMC is snubbing its smaller partners.

Bigger not always better

Many of EMC's SMB resellers were outraged when the vendor first announced its BPP thresholds because even though a large portion of their business is based on EMC kit, their small size means there is no way they could ever reach the new sales targets to maintain their top-level status.

Fosse admitted EMC had upset this section of the channel but promised to make things right.

"There are 20 partners [in EMEA] that have invested to be Signature [level] because there was no threshold, but are far away from the [new] Gold threshold," he said.

"That is the only real issue we have. It doesn't have an impact on us revenue wise but it is important from a quality and service [point of view]. We're working with each of them and looking at how we can help them mitigate the downside of the BPP implementation."

CRN understands that one idea mooted by the channel was to introduce a Bronze tier for smaller firms so they could enjoy higher margins and maintain some sort of EMC status.

Fosse said this had been considered by EMC, but it decided against the move.

"We're not going to dilute the strategic intent by creating a Bronze level," he said. "We are just going to take care of those [affected] partners."