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More on the NetSuite-Skyytek split

As with any divorce, there are a number of factors behind the imminent split between NetSuite and Skyytek, one of the largest, if not the largest, NetSuite business partner.

For one thing, NetSuite is building its own in-house consulting and services arm. Since services and support represent higher margins than the sale of licenses, NetSuite, like Oracle and other vendors before it, is competing more with its own services-oriented partners.

There also appears to be some contention over Skyytek’s use of what some call “sub-partners” to work with its NetSuite accounts. It sounds like Skyytek subcontracted out some work to other VARs to give it more geographical coverage or “feet on the street” at customer sites.

Layers of channel partners can make for some confusion, said other NetSuite partners.

“It is very difficult and confusing to address partnering needs on a global basis when you have a company building a sub-partner program within the current structure,” said Mick Gallagher, managing partner of LST, a southern California NetSuite partner via email. “The Skytech model works well for small companies who are building a channel from infancy, [which also] lack market locations and are trying to gain name recognition. However, when the channel matures it is confusing for the partner community as well as the end users.”

Skyytek CEO Ray Tetlow said he could not comment on this other than to say “sub-parnters” is an incorrect term.

“Skyytek operates one team all managed and controlled centrally for each and every SaaS ERP/CRM business process and implementation project. Geographical business units/regional offices with shared resources is more of an appropriate description. There is nothing wrong with Skyytek’s model ,our statistics in license subscriptions and customer satisfaction shows that,” Tetlow said via email.

Anyway, the breakup is causing a bit of a stir. D-tools recounts its less-than-stellar experience with both NetSuite and Skyytek. And here is more reaction to the NetSuite-Skyytek break up.

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