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Sun resellers not told about new rebate structure

Microscope contributor

Oracle has left Sun Microsystems' resellers in the dark over what their new rebate structure will look like despite ending the current channel programme this month.

At the same time it has upset some partners by changing the special bid process for key accounts, increasing the cost of support services and wiping out the RMA system.

Distributors have until October to roll resellers out of Sun Partner Advantage and into the Oracle Partner Network scheme, a process that is kicking off now.

"Oracle will publish the new rebate scheme in June," said one disgruntled reseller that asked to remain anonymous for fear of reprisals. "Sun is losing mind share in the channel because it has not been clear on compensation plans or strategy."

Another said he had received an indication that x86 and Sparc rebates may be further slimmed down and was now actively seeking alternative vendors, which were being particularly welcoming as they try to convince customers to switch from Sun.

The patience of even the most ardent Sun loyalists in the channel has been tested by Oracle ever since CEO Larry Ellison revealed its intent to take 4,000 of the largest accounts direct on the day the acquisition was completed in January.

The concerns then shifted in relation to operational issues - elongated lead times and difficulties with placing orders - as Oracle audited and overhauled Sun's internal systems, but some partners report that they still struggle with pricing and availability.

The special bid process has been changed, wiping out the key account agreement in place for larger customers and now partners must apply in individual cases to receive bigger discounts to win projects.

"This is a cumbersome process and if we have 10 big deals a month we have to apply for 10 special bids," said another frustrated reseller.

The nature of the support offering underwent a facelift some months ago, with the two lowest tiers being cut forcing customers to select the upper tier option which are dramatically more expensive.

"This change is starting to feed through now and our customers are not happy," said a dealer source.

Oracle has digested a number of software acquisitions and some had suspected it would wrestle with the integration of Sun. Its decision to switch off the RMA process is evidence of this.

"The idea of returns is alien to Oracle, it had no concept of returns," said one contact, who added it was taking up to four weeks on average to complete the process whereas it should take no more than four hours.

Sun/Oracle refused to comment.

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