Channel Concerns Voiced At Sun Partner Sales Meeting

However, beneath the energy-charged meeting was a strong undercurrent of partner concern about whether Sun was cutting some of its channel benefits to help ensure a profitable financial report.

Peter Ryan, Sun's new senior vice president of sales for the Americas region, who moved to the position on July 1 after the resignation of Tim Lieto, who held that position for just a year, was well received by solution providers who joined the sales meeting.

Ryan moved to Sun in the U.S. from the U.K. where he handled sales for Europe, the Middle East, and Africa.

One solution provider, noting that Ryan was Sun's third senior vice president of sales in two years, said the change in leadership might bode well with the channel. "He was saying the right things," the solution provider said.

Another solution provider said the sales meeting and Ryan's presentation were all very positive. "At the end of the day, those sales kickoffs all have the same high energy," the solution provider said.

However, solution providers were questioning just how far Sun might change its channel programs to help improve its profitability.

While Sun last week reported strong profit growth on the back of a moderate growth in revenue for Fiscal Year 2007, there is a concern among channel partners who attended the sales meeting that those profits come from cuts in Sun's employee count and in its channel program, the second solution provider said.

More cuts in headcount are coming. Sun last week said it is restructuring and taking a charge of $100 million to $150 million, most of which is expected to go towards layoffs.

Sun has cut its marketing, lowered its storage rebates, and cut other programs, the solution provider said. "The meeting tried to put a positive spin on results when everyone knows Sun made their numbers with cuts," the solution provider said. "And we look at where are the next cuts coming from to make their numbers going forward. The cuts helped in the last two quarters of the fiscal year, and will help in the next two quarters. But what about next year?"

The solution provider said that Sun is finding it hard to sell its their way to profitability. "The biggest feeling I got from meeting with other VARs is, they're waiting for the other shoe to drop," he said. "Sun's biggest sales growth comes from selling 1U servers, but that's a commodity product."

While Ryan was not able to comment on specific channel programs and issues, he noted that Sun in the U.S. cannot grow without the help of its channel partners.

"Coming to the U.S., I found we have a great team here, and great people in the company. I'm impressed with our partners here, with their breadth of experience. For feet on the street, our partners are critical," Ryan said. "I want to grow the business in the U.S., and grow it as fast as we can. Partners are a key part of our sales and technical team. I'm happy to help them make as much money as they can, and grow as fast as they can."

About 3,000 people attended the sales meeting, including about 2,000 Sun personnel and 1,000 people from about 250 partner organizations including technology partners, distributors, solution providers, systems integrators, and ISVs, Ryan said.

"The Americas sales meeting brought together all our sales teams and many of our partners," he said. "My style is, make it clear that we are all one team. Many of our technology partners are impressed with our meeting. They say they have never been invited to other vendors' sales meetings before."

Mike Thompson, president of Groupware Technology and Computing, a Campbell, Calif.-based Sun solution provider who attended the national sales meeting, said the message he brought home what that Sun is shifting more of its focus to improving sales.

"Sun has been more focused on technology," Thompson said. "They're a tech company. They have great products. But they will be more focused on driving sales. And that will be good for the channel."