HP Increases Rebates For HP 9000 Servers, Storage, Package Deals

Starting this week, HP is offering an additional 4 percent discounts to solution providers that sell HP 9000 series servers during the vendor's fiscal fourth quarter, said Dan Vertrees, HP's vice president and general manager of enterprise partners, Americas.

To help stimulate HP 9000 sales, HP is also giving its enterprise channel partners (ECPs)--the HP term for distributors--extra dollars that they can offer solution providers on the spot without getting specific authorization from HP, Vertrees said.

The company is also offering four new incentives to stimulate market share in the enterprise storage space. All Enterprise Storage Elite authorized solution providers that overachieve their enterprise storage sales targets for the quarter will receive rebates on demo equipment of up to $100,000, which essentially makes one or more items purchased for demo use free-of-charge, said Vertrees.

All enterprise storage authorized solution providers also will be eligible for rebates under HP's new business registration program when selling the XP series of enterprise storage arrays starting Sept. 1. Vertrees said this is the first time these products have been eligible for new business rebates. HP is also putting together new incentives for tape-library sales, but the details have yet to be finalized, said Vertrees.

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In addition, HP's Enterprise Storage Elite solution providers will get a fourth quarter 50 percent boost in back-end rebates on their enterprise storage sales, with the rebate now hitting 6 percent compared with the normal 4 percent.

Finally, HP is introducing a "Better Together" program under which solution providers that sell an HP 9000 server with storage--and the storage sales account for at least 45 percent of quarterly partner sales--will be eligible for an additional 3 percent rebate.

HP has about 500 enterprise storage authorized solution providers and 46 Enterprise Storage Elite partners, said Vertrees.

The incentives count for sales between Aug. 1 and Oct. 28, which corresponds with HP's fourth fiscal quarter, Vertrees said.

Jim Milton, managing director for the Americas and senior vice president of the Enterprise Systems Group at HP, said HP is going for market share with "aggressive" incentives.

"If you go back to the merger [with Compaq], since then, in every category, we have held our ground in terms of market share," Milton said. "But that's not enough. We've been defensive in the first year of the merger, making sure the merger went well. Now the merger is behind us. Now's the time to go on the offensive and take share."

That market-share offensive is aimed primarily at the channel and does not include discounts direct to end users, Milton said. About 55 percent of HP's revenue from its 775 non-public-sector named accounts comes from the channel, he said. "We are giving incremental incentives to the channel to get into those accounts," he said.

Rich Baldwin, president and CEO of Nth Generation Computing, a San Diego-based HP solution provider specializing in enterprise storage, said the incentives show HP's commitment to using the channel to help it increase its market share. "They really want to push those numbers," he said.