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By | Paul Kunert 16th June 2011 13:43

Microsoft blesses elite brotherhood to service big customers

The league of slightly less ordinary gentlemen

Microsoft has anointed a secret guild of Large Account Resellers to service its biggest licensing customers in the UK.

Under a re-classification, all 18 UK LARS will be authorised to sell to global customers, termed by the vendor as major accounts. But only a select band will qualify for the incentive programme kicking off on 1 October.

Edward Hyde, channel sales manager at the vendor, confirmed it had cherry-picked LARs for the programme, but was keeping mum on the names and numbers.

Indeed it is, as LARs were told individually of their status but not informed of rivals' involvement in the top level reward framework.

"We are not restricting LARs from selling to any customer segment," he told El Reg, but conceded that only those that have "substantial major account business will be participating in that set of incentives".

However, the financial rewards for those UK partners - which sources say include Insight Enterprises, Computacenter, Software One, Trustmarque, PC-Ware, Bytes and Dell - will fall by an estimated two-thirds from autumn at the behest of Redmond.

"The fees earned will be substantially less for all, it will not be a huge profit stream so Microsoft will become an anchor on which to sell other vendors' products," said one LAR.

Privately Microsoft acknowledges the potential threat from software rivals, but reckons its direct sales force will step up to the plate; though some LARs question if the vendor's relationship with majors is sufficiently robust.

Another said: "The direct sales force's pricing policies are inconsistent and some customers do not trust them - they are turning to external advisory services to ascertain if Microsoft is competitive. LARs can charge customers a fee for this based on cost savings they get from other vendors."

To qualify as major account partners LARs needed to satisfy criteria including transacting at least $10m worth of biz with major accounts, have presence in multiple territories, be able to bill in multiple currencies and hold a Gold licensing badge.

Major account LARs will also get fees for sales to corporate/ mid market customers but the programme overhaul may see competition in that segment intensify, with some braced for a price war.

"LARs that focus on the major accounts space will try to get into the mid-market so the mid market will get much more competitive," said one LAR. "It is our home territory so we'll defend our patch, but it's not good news."

Hyde dismissed this, saying there was enough room in the corporate/midmarket for partners to transact Enterprise or Select Agreements. ®

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