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VCE hiring, as Acadia fades, spurs channel conflict

The Virtual Computing Environment coalition is trying to hire partners' employees and competing with the channel for Vblock sales, some partners say.

In its effort to ramp up its Vblock push, the VCE coalition is recruiting from the ranks of its channel partners, according to channel sources, leading to hard feelings and channel conflict.

As previously reported, the Virtual Computing Environment (VCE) coalition, a joint venture by EMC, VMware and Cisco Systems, is hiring hundreds of technical and sales staff to boost Vblock sales. (Vblocks are the coalition's preconfigured bundles of EMC storage, VMware virtualization and Cisco servers.)

Some of those hires are employees of VCE's parent companies, but the coalition is also pursuing employees of its allied VARs and systems integrators. Many vendors -- including Cisco and EMC -- have rules in place against hiring people from their own channel partners or at least have hiring processes that discourage that practice.

VCE sources said the coalition is not supposed to recruit or hire from the ranks of its nearly 90 VCE partners, all of which are also top-tier EMC, Cisco and VMware partners. But that's not always the case, several VARs said.

"Cisco and even EMC are very protective of partners," said a sales engineer for a VCE partner on the East Coast. "I couldn't interview at EMC without jumping through hoops, and forget Cisco. But VCE is playing outside all those rules."

This sales engineer said VCE had approached him about a job and even interviewed him, but he remained with his current company. Two other VCE partners in different geographies said VCE had also approached their employees as well.

EMC, VMware and Cisco formed the VCE coalition a year ago, and it was initially staffed by a handful of Cisco and EMC employees on loan from those vendors. But hiring accelerated a few months ago, and sources put the current headcount at about 700 and growing.

VCE channel conflict
At its inception, VCE appeared to be very channel-friendly, but it has since developed more of a focus on direct sales, said two partners interviewed for this story. And an executive with another VCE VAR on the East Coast said the coalition tried to take at least one deal direct from his company in recent months.

None of the VARs interviewed for this story would speak on the record.

"VCE started out seeming very Cisco-like, in that it protected partners," said one integrator that works with VCE as well as all three of its parent companies. "But it is increasingly feeling very much like EMC, which does not."

Some VCE insiders acknowledged that the corporate culture of the founding partners -- in this case, EMC -- sometimes spills over into VCE. But they stressed that the marching orders from on high are to move at least 80% of deals through the channel.

VCE will clarify these go-to-market issues in the future, coalition sources said. VARs expect VCE to announce channel incentives as well as more competitive Vblock pricing early next year, with the goal of making it more profitable for VARs to sell Vblocks instead of their individual components.

Another New England-based VCE partner also reported attempted poaching of his personnel by VCE but was philosophical about it.

It makes sense, he noted, because VCE as well as its founding vendors as well as the VARs associated with all those vendors are all seeking out technical people with expertise in virtualization, the new Cisco Unified Compute Server and storage.

"There just aren't a ton of people out there with all those skills," he noted.

Farewell, Acadia
The VCE hiring push and reports of conflict come as Acadia, a services entity set up by the VCE, fades away.

The Acadia group, led by former Compaq CEO Michael Capellas, was chartered to design Vblocks for large service providers, build and test them before turning them over to customers. But that model did not catch on because, in many cases, customers turned out to be smaller companies that moved faster and didn't want Acadia to be involved, said a source close to VCE.

But others said VARs viewed Acadia as a competitor, and VCE executives realized that was thwarting their efforts to sign the virtualization-savvy partners they needed to sell and service Vblocks. Whatever the case, Acadia as a name and entity is going away, merging into a new VCE company, several sources close to the coalition said.

By all accounts there is strong customer interest in Vblocks, but sales haven't caught up yet. Richard Flanders, director of product marketing, at MTI Technology in the UK, said his company, already a strong EMC partner, is fully aboard with Vblocks, having sold two with several more in the pipeline. One customer, a large German recycler, bought in because it was running out of data center real estate and power. "It needed something to concentrate resources into one block, without costing too much," Flanders said.

He said Vblock sales require considerable up-front needs assessment and gap analysis of the customer's existing resources. These types of services are very important opportunities for integrators.

Kent McDonald, vice president of business development for Long View Systems, a Calgary-based systems integrator, said bundles like Vblocks and the analogous Flexpod offerings based on the Cisco, NetApp, VMware based multi-tenancy architecture, are striking a chord with companies that increasingly appreciate pre-packaged and completely-architected solutions. "That whole notion of one-hand to shake and one throat to choke remains compelling for many customers," he said.

This story was updated late Friday with additional VAR comment

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