NetSuite Puts Development Tools, Sales Resources Behind Its Channel Expansion
April 15, 2010 7:46 PM ET
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NetSuite debuted the next generation of its SuiteCloud development platform Thursday in a move the company said will help expand the partner ecosystem the company is building up around its on-demand ERP, CRM and e-commerce applications.
Holding its SuiteCloud 2010 conference for customers and channel partners in San Francisco this week, NetSuite also announced a strategic initiative with Amazon's cloud service, a partnership with business process outsource service provider Genpact, and an alliance with systems integrator WiPro.
The announcements, combined with channel-friendly keynote speeches by executives and plans to increase resources for the company's channel program, were all designed to hammer home the message that NetSuite is serious about expanding its solution provider program and growing sales through the channel.
CEO Zach Nelson, in a keynote speech, dismissed as a myth the view that cloud computing and the channel are a bad fit.
"While many people have said the channel is disintermediated by SaaS, I believe this year you're going to see incredible new business models emerging [from partners] around how to deliver this new technology to customers so they can run their businesses more efficiently," Nelson said.
Nelson's speech is in line with other comments he has made recently, including during an earnings call in February in which he predicted that 2010 will be the year that solution providers fully embrace Software-as-a-Service applications.
Last month NetSuite unveiled the "NetSuite SP 100" program, offering resellers 100-percent margins for first-year revenue generated by new customer contracts, in an aggressive bid to recruit channel partners from Microsoft, Sage, SAP and other vendors.
"That's opened up tons and tons of conversations" with resellers expressing interest in joining the NetSuite program, said channel sales vice president Craig West in an interview. About 10 have actually signed up for the 100 percent margin program (which pays 10 percent on annual renewals), while others have opted for NetSuite's traditional program of 50 percent margins on first-year subscription revenue and 30 percent on subsequent years.
While West said, "there's some really great names in the pipeline," he wasn't ready to identify newly recruited resellers. NetSuite has about 125 channel partners in the U.S. and Canada today and another 75 to 100 around the world. In his keynote Nelson said revenue from NetSuite's channel operations has been increasing at a compound annual growth rate of 39 percent.
Next: Netsuite Aligns Sales Organization With Channel Efforts
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