Dell EMC Rolls Out 'Flexible Consumption' Rebate For Partners

Acknowledging that customers' desire to pay for consumption of cloud resources can threaten to leave solution providers high and dry, Channel Chief John Byrne is adding a flexible consumption element to the Dell EMC Partner Program's rebate system.

"Think of something like VxRail, and customers want to pay for what they're consuming," Byrne said. "Partners want to go and find those opportunities. So we're building a model where on VxRail, for example, I will pay your rebate for that product, and I will also pay you as it's consumed. It's exciting for the customer and it's unbelievable for your balance sheet, the cash coming in."

Byrne, who announced the new model at the Dell EMC World conference in Las Vegas Monday said his team considered something more like a "finder's fee" for partners before settling on the consumption-based rebate model, which works like a profit sharing program tied to the initial sale and ongoing consumption of certain hyper-converged resources.

[Related: Dell EMC World 2017]

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The program is being run by Dell Financial Services and it comes in two flavors: Cloud Flex covers VxRail and XC Nutanix hyper-convergence solutions and Flex On Demand covers all Dell EMC storage platforms. In addition to profit sharing, solution providers using the flex programs get full tier credit and are eligible for line-of-business incumbency, which guarantees that accounts where partners have gained traction remain partner-led accounts.

"Customers have been asking for more options to operationalize their infrastructure," said Scott Harper, vice president of go-to-market strategy at SoftChoice, a Toronto-based solution provider. "The market's move to the cloud is driving an appetite for more utility service, pay-as-you-go options."

Harper said the flexible payment system being introduced now appears to build on some of EMC's past efforts. "We've seen EMC offer this type of program in the past with creative finance options, and it sounds like Dell EMC is bringing more scale to that type of offering. It should help remove financial barriers for some customers."

The model is also a neat fit with Dell EMC's cloud unit, Virtustream, which offers both its basic Virtustream Storage Cloud and high-performance Virtustream Enterprise Cloud on a pay-for-consumption basis. Part of Virtustream's secret sauce is the "micro-VM," which measures cloud consumption in "fine-grained" units, allowing the company to track usage and billing more accurately.

Also during the conference, Byrne announced that Virtustream Enterprise Cloud is being brought into the Dell EMC partner program. The move to the Dell EMC Partner Program means solution providers will be able to retire full tier credit in the Dell EMC program when they sell Virtustream Enterprise Cloud. Partners will also make front-end margin, have flexible selling options and get back-end rebates at the highest level under the Dell EMC program.