Business Objects Partners Wary As Business Objects Expands Services Business

In the wake of a struggling year to meet revenue and growth expectations, Business Objects is expanding the scope and head count of its Global Services organization, an overhaul that’s earning mixed reviews from the business intelligence vendor’s VAR partners.

Some solution providers said they welcome the opportunities to partner with Business Objects on projects, yet others complain that the software company is encroaching on their turf.

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* Business Objects’ services push comes in the wake of margin revisions that annoyed some partners. Earlier this year, the vendor revised its commission terms and trimmed margin to 5 percent on enterprise deals with customers that have more than $1 billion in annual revenue, according to channel sources.
* According to Bill Dunn of Dunn Solutions Group, and a Business Objects Gold Partner, “It makes sense strategically for them. You want to push your partners into the lower-margin, higher-overhead areas. We’ve been expanding into SMB, but we also do quite a bit of enterprise work. And we’re not going to stop doing that.”
* At a meeting last month between Business Objects and its top partners, “the No. 1 issue was the amount of margin partners are getting on enterprise accounts, and right behind it was the services issue,” said the partner, who requested anonymity.