Get Into SaaS Shape: HP VARs To Offer NetSuite On-Demand Apps

Hewlett-Packard's 15,000 VARs can offer NetSuite's on-demand ERP and CRM applications to their small and midsize customers under a deal HP and NetSuite unveiled Tuesday. VARs will receive a percentage of the sale as a referral fee.

HP and NetSuite executives said the program gives VARs an opportunity to get into the Software-as-a-Service application market and expand the scope of value-added services they offer. "This whole space is something they've been seeking out and looking for ways to get into," said Janet Pretti, HP vice president of channel marketing, in an interview.

The deal marks NetSuite's first such relationship with a hardware vendor. NetSuite uses HP hardware, including ProLiant servers and StorageWorks data storage systems, in its own data center.

With some businesses pulling back on capital expenditures such as IT acquisitions, vendors like NetSuite have been touting their SaaS applications as an alternative to traditional, often expensive, on-premise applications. The opportunity for VARs, beyond earning commissions or margins paid by vendors, is developing value-added services around SaaS software such as implementation and customization, business process design, training and data migration services.

While channel partners will refer the NetSuite applications to customers, the job of hosting the software will remain with the vendor, which will also hold the customer contract. NetSuite executives declined to disclose the percentage VARs would be paid for referrals.

NetSuite has begun training HP VARs on the NetSuite technology and how to identify sales opportunities. Some of the VARs already have experience selling on-premise ERP and CRM applications, said Mini Peiris, NetSuite product marketing vice president.

NetSuite and HP executives cited a report from AMI Partners that found that while 60 percent of midsize businesses see CRM applications as strategically important, only 16 percent have implemented them.