Some Symantec Partners At Risk of Losing Gold Status

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April has traditionally been the month when Symantec and Veritas have evaluated contributions from channel partners and either raised or dropped them to new levels based on performance. This time around, under a unified channel program that is approaching its one-year anniversary, Symantec is offering partners new contracts, showing them where they stand against their commitments, and informing them of any changes to their status.

This year, the stakes are higher than ever, according to solution providers. Partners that don't meet their numbers are getting bumped down a level, which affects their margins on registered deals. But some partners claim that Symantec hasn't been clear enough about when it would begin enforcing the terms and how it recognizes partners' contributions.

With the launch of a new channel program last April that unified 20 different Symantec and Veritas programs, the Cupertino, Calif.-based vendor grandfathered in partners at equal or better levels, and told them they needed to drive sales volume, invest in training, and drive market demand, said Julie Parrish, vice president of global channel sales and strategy at Symantec.

At the same time, Symantec introduced a three-tier partner ranking system in which Platinum partners receive a 12 percent rebate and 8 percent upfront discount; Gold partners get a 10 rebate and 8 percent upfront discount; and Silver partners get a 5 percent rebate with no upfront discount.

This year's releveling is causing many Gold partners to scramble to maintain their status or face the consequences of being dropped to Silver, which includes a 15 percentage point margin loss on registered deals.

One solution provider, whose channel account manager has told him he's going to be dropped from Gold to Silver level on April 1, said he'll suffer an immeasurable impact from the move. "Partner level gets worked into how competitive you can be and makes a huge difference in margin structure," said the source, who asked not to be named.

One Platinum channel partner said that when Symantec launched the program, his understanding was the first year would be a trial period to see what would happen with the new channel program benchmarks.

"The problem is, they started enforcing the terms early, so people who are more connected to Symantec in terms of leads are fighting and kicking to maintain their level, while those who are less connected are getting kicked down a level," said the source, who requested anonymity.

Parrish acknowledged that there's a "big drop" in margins on registered deals between the Gold and Silver levels. However, she noted that most of Symantec's competitors don't offer deal registration to their lower program tiers, and last year Symantec lowered the deal threshold to $5,000 for Backup Exec and antivirus software to allow more Silver partners to participate.

The annual sales volume requirement is $2 million for Platinum level, $250,000 for Gold level, and $150,000 for Silver, according to Parrish. "We want a significant difference to offset the investment required to be Gold or Platinum," she said.

Parrish says Symantec last April informed partners of the terms of the new program and said they'd have a year to meet them. "I believe we were very clear in letting them know about the terms and our intent to enforce them," she said. Symantec in general tends to raise partners' level throughout the year if they meet their requirements, she added.

NEXT: Why some partners welcome the program releveling.

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