Novell plans distributor discount changes

Novell is to shake up the way it awards discounts to distributors in Europe, despite claims that its reseller strategy is continuing to show benefits.

Johan Rosius, Novell's European director of market sales, said that the company wants to better measure the value it gets from partners.

He explained that Novell is looking to "optimise" its distribution strategy in order to give more money to resellers.

Instead of offering one level of discount, margins will depend on the value distributors add to the company.

"All products go to all distributors at the same discount rate and that's no longer cost effective," Rosius told vnunet.com. "My plan is in 14 to 18 months to have a new distribution strategy."

At Novell's Brainshare conference in Utah, Rosius also said that Novell's strategy in Europe is already paying off, with sales through the channel increasing by 15 per cent in the past year.

Novell controls the relationship with the customer in a small number of named accounts, but may also involve channel partners. Remaining accounts are led by the channel partner, and Novell only gets involved if invited.

Rosius claimed that Novell had removed technical and consulting barriers by giving partners access to its methodologies, providing rebates to resellers involved in complex deals, and offering free support and training.

"That works very well and a lot of trust has been put in place. If you can lower [partners'] time to market and investment costs then you have their ear," he said.

The strategy has also affected the make-up of Novell's channel, creating a stronger emphasis on consultants and developers. "Our reseller landscape today is very different," insisted Rosius.

Earlier at the conference Novell's president and chief executive Jack Messman said: "Novell was built on the back of the channel and we want to support them much better than we have in the past."