NEC adds extra tier to push broadband business

NEC adds extra tier to push broadband business

NEXTEP, the wholesale broadband business of NEC, plans to introduce a premium level tier to its current flat channel structure to gain a wider share of the small business and corporate branch office market.

Managing director of NEXTEP broadband, Michael Johannessen, said that since its inception, NEXTEP has had direct dealings with all of its channel partners and made agreements with them on a case-by-case basis.

Seeking a more efficient method for dealing with its 60-plus current dealers, while also attracting new ones, the company wants to separate its channel partners into two streams. It will create a new tier in its channel model by accrediting certain large and highly-skilled partners to on-sell broadband connectivity to their smaller IT consultants and VAR peers.

These accredited business partners will be termed Networked Partners and will generally be large systems integrators or service providers with skills in the telecommunications field. “They are the new age carriers — businesses with a high level of skills that do not necessarily own any infrastructure,” Johannessen said. “We will embark on a campaign to feed the smaller VARs into them.”

NEC channel partners interested in being accredited would be evaluated on their capabilities and skills rather than merely their size, Johannessen said. Partners would need to prove they had sufficient help desk, field support services and billing capabilities to be considered.

Johannessen said that about 30-40 of NEXTEP’s current 60 resellers would be accredited as Networked Partners and deal directly with NEC under the new deal. The remaining resellers would mostly be small IT consultants, for whom the broadband business was incidental to the revenues they derived from such services as network management or PC upgrades. These resellers would maintain a technology and training relationship with NEC but, commercially, would be buying through a larger Networked Partner.

Those that do not meet the criteria to become Networked Partners would not be selling at a price disadvantage, Johannessen said, as a rebate scheme would be introduced to ensure that regardless of whether a reseller buys through NEC or through a ‘Networked’ partner they would see little difference in price.

Johannessen said NEC would continue to play an active role in its channel, capturing sales through its Web site and passing them down the chain to resellers. NEC would also provide co-op marketing funds ‘on a case by case basis’.

The vendor has held channel forums in Sydney and Melbourne attempting to win over its existing reseller partners on the new plan. Johannessen said the response, so far, had been ‘very positive’, and that the vendor would continue to seek partner feedback as it implemented the new strategy.

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