Reseller Incentives Shift in 2011

Large Account Resellers (LARs), the primary sales channel for licensing sales to Microsoft’s largest customers, face a change in Sept. 2011 when Microsoft begins handling Enterprise Agreement (EA) sales and contract maintenance for about 2,200 of its largest customers. Believing that its own capacity to service such accounts has increased, and that few opportunities for new EA sales remain among its largest customers—about 70% of whom already have EAs—the company wants LARs to shift their efforts to the next customer tier down, where it estimates that 70% of the 90,000 customers do not yet have an EA.

LARs and ESAs

LARs are the only resellers through which customers can purchase software through Microsoft’s Select and EA volume license plans, which are generally aimed at companies with 250 computers or more. LARs are compensated for selling EAs in two ways: through commissions on the EA revenue or, more commonly in mature markets such as North America, through fees that they earn for services such as selling, transacting, and managing the agreement. In this latter role they are known as Enterprise Software Advisors (ESAs).