MCI to Sell Managed Services Through Cisco Channel

The two companies are working together to identify Cisco partners with IP communications and security expertise to sell MCI's IP-based services, including its MCI Advantage hosted VoIP and managed firewall offerings, in exchange for a monthly commission. The services are targeted at SMB customers.

MCI has designated dedicated personnel to support the Cisco initiative and is offering channel-neutral compensation to its sales reps on SMB deals that involve Cisco solution providers, said Phil Meeks, vice president of MCI's strategic ventures and alliances. Compensation neutrality will also apply to larger deals if partners register them, he said.

Meeks declined to disclose commission levels on services sold by Cisco partners, but said they would be on par with the terms and conditions offered through its own channel program.

Despite turmoil surrounding the pending sale of MCI, the Ashburn, Va.-based telecom carrier has forged ahead with bolstered channel plans, including the launch two weeks ago of a new partner program specifically geared to drive sales to SMB customers.

Last week Verizon Communications agreed to acquire MCI for $6.7 billion, a deal which still needs to garner MCI shareholder and regulatory approval. Qwest Communications International, which also courted MCI with an $8 billion bid, is expected to up the ante with an even larger offer, meaning that the deal might not be done.

Nevertheless, MCI and Cisco are encouraging some Cisco solution providers to make an investment in their managed services practices in order to sell MCI's services.

"Clearly selling a managed service is different than selling CPE [customer premise equipment], so you need to go through a change in your business model in terms of training your sales staff, your systems engineering and network design people," said Nigel Williams, vice president of worldwide service provider partners at Cisco Systems, San Jose, Calif. "Pricing managed services is very different than pricing CPE, so let's just recognize that upfront and be clear with our partners that, although extremely profitable, there's work you've got to do to put some skin in the game here."

The companies have developed a training regimen for Cisco partners that sign on to sell MCI's services, the executives said.

Meeks declined to comment on the acquisition or its potential impact on the company's channel efforts. "It's a success-based world we live in, so as we draw the kinds of revenues we anticipate driving with Cisco over the next 12 months, I see no reason why that wouldn't continue to happen in a broader environment," Meeks offered to solution providers seeking assurance that such an investment would not evaporate if MCI's plans are scuttled by its future owner.

Through Cisco's regional planning efforts, a strategy through which the networking vendor keeps a close tally of channel partners and their capabilities throughout different geographies, Cisco and MCI are recruiting partners to sell the services, Williams said

For Cisco, the move is part of an ongoing strategy to tap its service provider customers as a broader source of revenue for its partners, Williams said. Cisco already has similar partnerships with AT&T and SBC designed to boost sales of services delivered on Cisco-based networks.