SuSE is preparing to introduce a Volume Pricing Agreement (VPA) to rationalize its sales and channel offerings and replace a series of informal discounts. Company CEO Richard Seibt told ComputerWire that VPA is sign SuSE is growing up.

The move to a volume-pricing model will help SuSE scale its business model, making it better able to take advantage of expanded OEM relationships and an emerging focus on desktop systems.

The industry has similar volume purchase agreements that cater for different products and channels, Seibt recently said. It’s a standard in the software industry.

We don’t want to differentiate ourselves because we have a different price structure. He did not provide details of VPA.

Volume licensing agreements are a popular means for ISVs to appeal to large customers and OEMs. Agreements mean such organizations effectively get a percentage off the full off-the-shelf price for software.

For large end-users this means reduced IT spending on software while OEMs and channel partners can pass on the cost saving to their own end-customers.

One OEM who could take advantage of VPA is Dell Corp. Seibt hinted at a formal relationship between SuSE and Dell, saying the companies had received a lot of requests for SuSE Linux on Dell hardware, although he did not indicate when a deal might be signed.

A deal would help pry open Dell’s user base for SuSE, which largely prefers Dell’s direct sales approach. Dell will give us the opportunity to get access to the accounts that want to sell directly, Seibt said.

Dell would help expand the roster companies partnering, who include IBM Corp, which Seibt said helped put SuSE Linux onto mainframes and Hewlett Packard Co, who he said provided SuSE access to mass market servers and machines running Itanium processors.

Seibt added SuSE sees its next opportunity on desktop PCs. The company is in talks to supply Linux-based clients to three customers who wished to remove Microsoft Corp’s software. He claimed the organizations are each running 250,000 clients 100,000 clients and 60,000 clients.

The desktop will become increasingly important. The cost pressure on IT budgets will not go away, Seibt said.

Source: Computerwire