Cisco Offers Partners New Upgrade Incentives

Starting off the week, Cisco Systems has launched a new program that will help its partners take full advantage of current technology-upgrade cycles.

Called Foundation Advantage for Partners, the program enables and rewards partners for upgrading their installed base, an opportunity that the company estimates could be worth more than $20 billion worldwide.

"The program is designed to motivate channel partners to take advantage of the tremendous opportunity within our installed base, because anything that's more than 5 years old is now somewhat obsolete," says Edison Peres, vice president of technology and sales for Cisco's worldwide channels.

The five-year number refers to the technologies IT customers installed in anticipation of Y2K issues--devices and applications that have served their purposes and now need to be replaced or upgraded.

"A large chunk of this technology is still out there," says John Growdon, director of routing and switching sales technology programs for Cisco's worldwide channels. "Customers are upgrading their networks because of security concerns and because networks are so much more complex today than they were a few years ago."

Foundation Advantage provides incentives for customers and partners to participate more aggressively. Among the highlights are a new trade-in program for non-Cisco equipment. Prior to this, the company had only offered trade-in credits on Cisco products through its Technology Migration Program (TMP).

"This dramatically opens the door for our partners to go out and upgrade non-Cisco customers," Growdon says.

Participating partners also will receive 15 percent back-end rebates based on TMP credits. The program is open to any certified partner that registers at least $25,000 in trade-in credits during the preceding six-month period, have minimum equipment-return rates of 85 percent, and have a business plan for Cisco's Trade-In Accelerator Promotion (TAP). Cisco will pay out rebates at the end of each six-month period. Finally, the company has created a network-discovery tool that enables partners to scan customers' networks to see which devices are present and due for an upgrade.

Cisco partners say Foundation Advantage will enable Cisco to keep growing in a market in which it already has huge market share.

"The enticement for us is a back-end rebate similar to what the VIP program offers," says Tim Carney, president of the Network Guys, a consultant and systems integrator in Fremont, Calif. "We can offer customers upgrades and additional discounts on what they're trading in."

Dave Woodward, vice president of sales for Calence, a network consultant in Tempe, Ariz., says the overall features of the program will make it easier for his company to initiate and close deals.

"The competitive trade-in feature is attractive, and the discovery tool has been moderately successful so far by helping us get our arms around what's in a client's network today," he says.