HP Offers Extra Rebate On Storage Management Software

Starting March 1, authorized HP storage solution providers can sell 121 software SKUs, which normally require certification, and qualify for a 6 percent rebate in addition to normal channel discounts, said Dan Vertrees, vice president of enterprise partners for the Americas at HP.

The program was presented at HP's ENSA@Work storage solution provider conference, held here this week.

The Partners in Excellence program is open to distributors and business-class and enterprise-class storage solution providers, Vertrees said.

Ed Burke, HP's director of partner storage sales, said the new program puts in place an immediate benefit for any authorized partner, while giving the solution provider until June 30 to certify sales and technical personnel on the software. "We are giving them the benefit of the doubt now," Burke said.

Starting July 1, the additional 6 percent rebate no longer will be offered to solution providers who do not pass the certification tests, Burke said. Technical training for its higher-end software such as OpenView Storage Area Management typically requires three days of in-class instruction, while sales training is done over the Internet, he said.

The program gives solution providers an opportunity to see the benefits of selling HP storage software, Burke said. "Partners should see that when they get competent, their sales will go up," he said.

The program comes at a time when HP is pushing its solution providers to increase sales of storage management software. Storage hardware average unit prices are falling, but software can help solution providers get back some of the revenue and profit, said Howard Elias, senior vice president and general manager for network storage solutions at HP. Software also gives account control, he said.

As a result, more than half of HP's storage R&D is spent on software, Elias said.

Solution providers said the Partners in Excellence program carries a potential risk to those that have already gotten certified in the storage management software, but they expect the rewards of the program to outweigh those risks.

Such promotions have no effect on Prosys Information Systems, said Steve Perea, regional vice president at the Atlanta-based HP solution provider. "We'll certify with a software application the second we know how to certify," he said. "So regardless of whether there is an extra rebate, we will sell it."

However, Perea said, there will be more competition as a result of the program. "Some of that competition will be bad for the market. But it also will help us show our credibility," he said.

Ultimately, the program will do exactly what HP desires, which is open the channel to new products, Perea said. "HP's message to resellers is that we must diversify our products," he said.

Gary Hazard, vice president of Atrion, a Hillsborough, N.J.-based solution provider, said he does not expect new competition as a result of Partners in Excellence. "Certification is not easy," he said. "This creates barriers to people who are not qualified. Also, selling such software is a six-month sales cycle. From now until June, unless a solution provider finds a needle in a haystack, they won't make a sale. ... For the other guys who are trying to sneak into selling this software, it is hard to do."

Burke also said he does not expect the program to result in problems for solution providers that are already certified, although he promised no guarantees. The business-class software is open to any HP-authorized solution provider, while the enterprise-class software is only for about 500 authorized partners. "We've done a pretty good job of segmenting the market to avoid the risks," he said.