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Technology investment fund to give Sun partners $100M for demo gear

Sun partners say they can see growth opportunities with the newly launched technology investment fund that gives partners cash to secure Sun technology for test, demonstration and proof-of-concept opportunities.

Sun Microsystems Inc. partners say they applaud yesterday's announcement that Sun is launching a new technology investment fund to help partners buy Sun products for customer demonstrations.

The Partner Growth Fund (PGF) is a $100 million pool of cash that partners can tap when they want to secure Sun's latest hardware and software for demonstrations to end users about to make purchasing decisions.

The technology investment fund will be distributed to partners worldwide, starting Sept. 1; amounts will reflect the revenue levels of the partners involved.

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"It's a progressive scale," said Bill Cate, Sun's senior director of global channel planning and programs. "So for instance, I think the U.S. accrual rate for executive-level partners is half of a percent of everything they sell. If you take a reseller that sells $10 million in a year, they are going to earn somewhere around $500,000 to use on demo equipment."

The PGF is not designed as a way for partners to fund the purchase of gear for resale; Sun requires partners to keep any system bought with PGF money for six months.

Worldwide, eligible partners include global systems integrators (GSIs) -- companies such as Accenture and EDS -- as well as 150 executive-level partners and 450 principle-level partners.

Access to the program for Sun's 2,400 associate-level partners will be managed through Sun's distributors. To kick-start the technology investment fund, Sun is giving GSIs, executive-level resellers and executive-level ISVs systems worth about $30 million.

The new program is designed to alleviate partner complaints that they were paying out of pocket for systems they acquired through Sun's current demonstration program, which only discounts the products, Cate said.

"It's a good program for us," said Scott Robinson, chief technology officer at Chanhassen, Minn.-based Datalink Corp. "In the past it has been challenging to use our traditional marketing funds from Sun to acquire that demo gear. What this does is give us a formal way to allocate essentially what otherwise would have been other marketing funds."

The PGF will also let VARs who use the existing discount demo-system program only rarely increase their hands-on marketing, according to Mike Willard, principal partner at Dallas-based Soccour Solutions.

The new technology investment fund, Willard believes, will be valuable not only because it makes it easier to run proof-of-concept demonstrations at his company's facilities, but because it allows them to more easily obtain Sun technology for demonstrations at customer sites.

"I would say that there is a significant percentage of closure of deals if the customer comes to our demo center, and that number is raised exponentially if we can put together a proof-of-concept solution on their floor. Proof-of-concepts and demonstrations at customer sites equal closed business deals," Willard said.

Sun's storage practice -- one of its weakest -- should get a particular boost from PGF and programs like it, according to Mike Thompson, president and CEO of Campbell, Calif.-based Groupware Technology Inc.

"Sun has great technology and these programs will allow our customers the opportunity to kick the tires and become further aware of all the capabilities that Sun has to offer," Thompson said.

Let us know what you think about this story; email: Nicole Lewis, Senior News Writer.

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