Sun Cuts In Partners

The system maker changes its direct sales promotion after VARs complain that it undermines in-process channel deals.

Four days after it initiated a sales promotion that offered deep discounts directly to customers on some of its major products, Sun Microsystems is making changes to the program to quell cries of channel conflict from partners.

VARs told Sun that the promotion was undermining deals they had underway with customers, the company said in a statement issued late on April 26.

"We regret that this promotion was not more fully inclusive of our partner community," company officials said in the statement. "As a result of discussions with a number of our partners, we have realigned the program to support Sun's channel strategy."

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Sun officials said that effective immediately the sale would include three new elements to ensure Sun partners get value from deals they initiated. First, VARs can register deals that they generated but that ended up being transacted via the Sun online store. Second, customers are now able to indicate the partner they have been working with so that Sun can credit and compensate partners for that business. Third, partners with deals in process that meet the sale criteria can register those deals.

"We underestimated the extent to which promotional pricing could overlap with proposals in process either through our partners and our direct sales force and believe this solution quickly addresses the issue," Sun said.

The Santa Clara, Calif.-based system maker initiated the two-week-long promotion on April 23, offering deep discounts directly to customers and billing it as the Sun 25th Anniversary Sale.

Among the products offered at the discount are several Sun Fire servers, a few Ultra workstations and several StorageTek NAS appliances.

Discounts offered are large. For example, the Sun Fire X4500, regularly priced at $47,995, is now priced at $24,000. The Sun StorageTek 5320 NAS, regularly priced at $44,814, is now priced at $15,630. And the Ultra 45 UltraSPARC workstation, regularly priced at $3,695, is now priced at $2,405.