Cisco Pays Rebates For Storage Goals

Cisco Systems this week is unveiling a program to provide 5 percent back-end rebates to solution providers that meet goals for increasing their sales of the company's MDS 9000 family of Fibre Channel directors and storage switches.

Under the Clear Advantage rebate program, solution providers—which source Cisco's storage switches for resale through Cisco's vendor partners—are eligible for the 5 percent rebate if they increase their sales of MDS 9000 switches by 20 percent on a quarter-to-quarter basis, said Keith Zubchevich, director of storage worldwide channels at Cisco, San Jose, Calif.

And solution providers that miss their goal for a quarter will have a chance to make it up, Zubchevich said. "We won't pay the rebate for that quarter, but if, during the following quarter, they make that quarter's goals and also sell enough to make up for the missed goal in the previous quarter, they will get a rebate on both quarters."

Chris Lusk, director of open systems and storage at Sirius Computer Solutions, a San Antonio, Texas-based solution provider, said he is happy to see Cisco launch such a rebate program.

Lusk believes Cisco will use the rebate program to help it gain more insight into what is happening in the channel and to enable the vendor to better forecast sales.However, he noted that the ability to make up for previous quarters will make the rebate program more of an accounting challenge for his company than the programs of Cisco competitors such as McData and Brocade Communication Systems, which pay straight percentage rebates on sales directly to the people involved in the sale.

Currently, solution providers purchase MDS 9000 switches from seven Cisco vendor partners: IBM, Hewlett-Packard, EMC, Hitachi Data Systems, StorageTek, Xiotech and Network Appliance, Zubchevich said.

Through the rebate initiative, which is offered only to Cisco-certified solution providers, the vendor expects to increase the number of channel partners that resell the switches, he said.