Cisco VIP: Open Invitation

Vendor modifies security product rebate levels for partner program

By Jennifer Hagendorf Follett, ChannelWeb
12:01 AM EDT Mon. Aug. 29, 2005
From the August 29, 2005 issue of CRN

Cisco Systems this week is again extending its popular back-end rebate program, rolling out changes that aim to open the program to more security partners and boost partner sales of IP communications applications.

Entering its sixth phase, the rolling six-month Value Incentive Program (VIP) rewards qualifying Cisco certified partners for pushing VoIP and security technologies and maintaining high customer-satisfaction levels.

VARs said the program changes reflect trends they see in the market. “Security is inherently a part of every network now, especially as we drive more IP communications,” said Jon Jensen, CEO of Nexus Integration Services, Valencia, Calif.

Under the new program terms, retroactive to Aug. 1, Cisco is eliminating the stipulation that security partners had to have a security practice that accounted for at least 25 percent of their business to qualify for VIP.

“We want to move to an environment where basic security is sold by every partner any time they put in a network,” said Edison Peres, vice president of advanced and core technologies for worldwide channels at Cisco, San Jose, Calif.

The vendor also is modifying the rebate levels partners earn for selling security products. Instead of 10 percent rebates across its security product lines, partners now can earn 7 percent rebates on core security technologies, such as VPNs and firewalls, and 14 percent rebates on advanced products, such as intrusion prevention and end-point security offerings.

On the VoIP front, the vendor is pushing its partners to sell more Cisco applications such as contact center and unified messaging. Now, on top of a base rebate of 16 percent, partners that attach applications to between 15 percent and 30 percent of their VoIP product sales will earn an additional 4 percent rebate. Those that exceed 30 percent attach rates will earn an additional 6 percent rebate. Previously partners earned rebates of 20 percent.

Keith Goodwin, Cisco’s new senior vice president of worldwide channels, pledged to continue the vendor’s foundation for partner profitability built on initiatives such as VIP and said the company is looking at ways to make its incentive programs easier to use.

Some 94 percent of all of Cisco’s U.S. voice revenue and 75 percent of its U.S. security revenue now go through VIP, Peres said.