Sun JES To Pay Up Front

Sun soon will begin compensating its salespeople when they book a deal based on the net present value of the JES deal over the life of the contract, said Sun President and COO Jonathan Schwartz. This means salespeople would receive commission on the entire price of the deal up front rather than each time the yearly subscription fee is paid.

That model eventually will be extended to Sun's channel partners, Schwartz said.

Sun currently gives partners a discount on the initial price of a JES sale and margins on the renewal fees when the customer pays a yearly subscription. The JES pricing model today is based on a flat rate of $100 per employee per year.

Solution providers said the new model can help solve two problems for Sun and its partner community. Under the new plan, the commission on a sale will be protected even if a customer opts out of a JES contract early.

More importantly, it also will help alleviate channel conflict over who has the right to renew JES customers if their yearly subscription payment is past due, said Marc Maselli, president of Back Bay Technologies, Needham, Mass.

Sun already has about 350,000 JES subscribers, generating about $350 million in annual revenue.

Sun also expects to launch a number of new managed services on top of JES over the next three to six months. Those services include a new Desktop on Demand service that allows users to download their desktop environment to any desktop client, create several virtual environments on one remote server, and extend compute jobs by dynamically provisioning additional servers to create a grid network, said Robert Youngjohns, Sun's executive vice president for strategic development and financing.

Those types of services are available to end users at a cost of $1 per hour of CPU time. Billing for those services will be handled for Sun and its partners through a forthcoming alliance with a telecommunications partner that already has the ability to issue bills based on metered usage of services, Youngjohns said.