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Cisco Channel Partners Get More VIP Treatment

Cisco Systems last week introduced solution providers to the second phase of its Value Incentive Program (VIP), which makes it easier for participating IP telephony and security partners to qualify for rebates.

Cisco launched the worldwide program in January to help improve the profitability of partners working with high-growth technology. The vendor outlined phase two of the effort at its Innovation Through Convergence conference in Santa Clara, Calif.

VIP measures partners' product sales and customer-satisfaction ratings over a six-month period. Eligible solution providers that meet the program's standards receive 10 percent back-end rebates on IP telephony and security product sales and related SmartNet maintenance contracts at the end of the six-month period.

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Cisco's Edison Peres says the VIP's early success warranted an extension.

Cisco is extending the program for another round, which runs through the end of January 2004, said Edison Peres, vice president of emerging technologies for worldwide channels at the San Jose, Calif.-based networking vendor.

"It's a way to get more concentrated attention from our partners," Peres said.

The extension stems from the success of the initial rollout, Peres said. U.S. IP telephony partners that participated in VIP increased their weekly bookings by an average of 28 percent, while security partners saw an average gain of 10 percent, he said.

In addition, Cisco is expanding the portfolio of eligible IP telephony products to include VoIP gateway modules. It's also adding new growth incentives that grant an additional two-point rebate to solution providers that grow their business by 15 percent to 20 percent compared with the previous six months.

Cisco also is taking some "corrective actions" to adjust VIP elements that were too restrictive and is making those changes retroactive, which will boost the number of VIP partners that get rebates from their first-round activities, Peres said.

For example, Cisco is lowering the number of required customer-satisfaction surveys that solution providers must collect to qualify for the rebates. The vendor found that the numbers were difficult for many partners to achieve.

"We got the numbers, but it was a serious undertaking," said Ron Temske, director of converged technology solutions at Logical, a Bloomfield Hills, Mich.-based solution provider. "Of the total VIP [rebate], we probably spent 10 percent of the number in thank-yous back to the customers."

At the Innovation show, Cisco also unveiled the IP Phone 7970G, which features a high-resolution, color touch-screen display and XML support. The product is slated to ship in the first quarter of 2004 at a list price of $995.

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