Cisco will reinstate compute deal registration as of April 15, reversing a decision that sparked major partner backlash.
“Deal registration for Core Unified Computing is designed to reward your investment in Cisco and accelerate your ability to deliver value to customers,” said Cisco Senior Vice President of Global Partner Sales Tim Coogan in a note to Cisco partners sent on Tuesday afternoon. “With this update, you will once again receive the benefits of being provided discount differential, and you can confidently lead with Cisco on your compute deals.”
The reversal comes two months after Cisco shocked partners by eliminating compute deal registration on February 20 in the wake of rising memory prices.
Partners told CRN that Cisco realized the decision to eliminate compute deal registration had resulted in server competitors taking a bite out of longtime Cisco Unified Compute System accounts.
“I’m happy, but I’m not surprised,” said a top sales executive for an SP500 partner who did not want to be identified. “They were feeling the pressure and losing market share to the competition. We have options to sell Lenovo, Dell or HPE. That’s why Tim Coogan said in the letter you can now lead with Cisco. They realize they made a mistake. They were feeling the pressure from partners.”
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Partners had told CRN that Cisco’s unprecedented decision to eliminate deal registration for the compute business had effectively eliminated eight points of margin, prompting them to look at moving Cisco compute deals to other vendors.
“It’s a smart move by Cisco,” said the sales executive of the move by Cisco to reinstate compute deal registration. “With the lack of deal registration, they saw deals switching over to other OEMs. It’s crazy that they made the decision to eliminate it in the first place.”
“I’m sure Tim got a million phone calls on this,” said the sales executive. “Tim Coogan carried a sales bag. He was an enterprise account manager. He knows how to open a deal and close deal. He knows the pressure partners are under. Unfortunately, he was caught in the middle of this.”
Coogan in his note to partners said that the tech giant has been “dedicated” to reintroducing compute deal registration.
“We recognize it is a cornerstone of our partnership. You’ve been asking about this, and we’ve been focused on bringing it back,” he said.
Cisco indeed heard partners loud and clear, according to a CEO of a Cisco partner organization who spoke to CRN under the condition of anonymity.
“That’s what good partners do — if you make a mistake, you quickly undo it if you can,” the CEO said. “It was a miss on their part — it was definitely an odd move, but Cisco doesn’t let anything get in the way of the channel. Loyalty is not built in a day. Partners raised the flag, and [Cisco] fixed it.”
Cisco first began reshaping its compute pricing policies in February, citing rising memory costs as it updated contract terms to allow order cancellations up to 45 days before shipment and repricing if component, manufacturing, tariff or currency costs increased. Cisco later on March 8 cut quote protection to seven days for compute hardware and 14 days for non-compute hardware. These changes will remain in place, according to Cisco’s updated FAQ as of Tuesday afternoon.
Cisco’s overall deal registration program for its other product lines has remained unaffected.
Coogan reminded partners in his email that “as always” the Cisco account team is here to help them: “If you have questions, want to talk through specific opportunities or need help getting started, please reach out to them directly. Thanks for your partnership and for continuing to bet on Cisco Compute.”
