Sun Microsystems may be reeling from the $1.7 billion loss it posted last week, but it's still trying to drum up...
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paying business for its software stack -- and the partners who sell it.
As the company takes more of its software open source, it wants to help value-added reseller (VAR) partners build practices and expertise around that software, which will earn them generous margins via Sun's new Open Access Channel Program.
The Sun Software Specialties program targets what Sun sees as high-growth areas in identity management: service-oriented architecture (SOA), MySQL, xVM virtualization, virtual desktops and open storage, according to Bill Cate, senior director of Sun's global channel. Last spring the company announced a similar effort around green computing involving clustering and Solaris.
Partners who train and develop expertise in these areas can earn additional margin and rebates, said Cheryl Turja, Sun's director of U.S. partner programs.
"The bump they get will depend on what their sales mix looks like. We already had rebates for software sales, a flat figure paid to anyone who sold Sun software," Turja said. "Now we'll take that rebate and change how it's laid out. So a partner who's just in Sun Partner Advantage but doesn't pursue a specialty could actually see a decrease in rebates."
There are about 12 partners in the U.S. now building practices in these areas, and Sun hopes that number will grow.
The program rewards software specialization with high margins
Brian Wolfe, co-founder of Laurus Technologies, an Itasca, Ill.-based Sun partner, said companies like his that can provide full solutions integrating tricky technologies like identity management do reap higher rewards. Laurus does a lot of work not only with Sun identity management and other Sun software but with Oracle E-Business Suite and SAP applications, and that is where the value lies.
Sun VARs have complained that Sun's emphasis on freeware or open source versions of its software has hamstrung their ability to make money, but Sun CEO Jonathan Schwartz continues to talk up the free options. Sun has also made some channel-friendly moves in opening up potential new business to partners only. And Turja said those overtures are starting to pay off.
Wolfe said Sun is seeding the market with samples of its technology so that students and others can get a taste, and when they go on to get jobs, they start requesting those products, hopefully in commercial (paid) form.
And a new Open Access Channel Program will make it easier for VARs outside the Sun ecosystem to source Sun software from distributors. "There are hundreds of VARs who buy from the disties who run into situational opportunities where Sun partners may not be involved. [In those cases] we want no barrier to entry to our products," Cate said.