By Cara Sievers

As the country awaits an economic rebound, channel partners in the communications industry reported fairly steady revenue streams and a positive outlook on growth. PHONE+’s 2010 Channel Compensation Survey polled agents, consultants, master agents, VARs, systems integrators and interconnects in December 2009, to benchmark the sources of, expectations for and feelings about channel revenue.

Nearly half, 40 percent, of the survey respondents classified themselves as agents or subagents, with an additional 28 percent of respondents being master agents. Nine percent of respondents were consultants, and the remainder of replies came from a mix of systems integrators, interconnects/dealers and VARs.

The responses revealed a positive outlook for 2010 revenue, with 72 percent of respondents reporting being on target with or ahead of expectations for 2010 (See Figure 1: 2010 Revenue Outlook). This percentage is down only slightly from 76 percent of respondents to the PHONE+ 2009 Channel Compensation Survey.

However, hopes for year-over-year revenue growth appear to be up significantly this year. At least 62 percent of respondents said they expect double-digit growth from 2009 to 2010 – a jump from 53 percent with similar expectations for 2008-2009.

Other highlights from the survey included the identification of revenue growth areas and new revenue sources. For example, while channel partners continue to rely heavily on some of the same revenue streams year after year, other revenue areas, such as hardware and software, are growing in importance. Additionally, new forms of compensation are gaining ground. For example, the number of partners receiving equity or profit-sharing opportunities is up to 38 percent from just 26 percent last year.

As in previous years, reported commission percentages varied by product or service, but not to a high degree (See Figure 2: Average Commission). Commissions ranged from 3 percent to 65 percent across all products, but software as a service (SaaS) came in with the highest average commission at 28 percent.

In general, agents are reporting that the commission landscape is growing tighter, referencing thinning margins, reduced commissions and an increase in carriers cutting agent agreements for low volume. Some partners reported a declining level of trust in vendors due to late payments and constantly changing channel programs and commission levels. Conversely, other partners noted vendors’ growing acceptance of the channel and expressed hopes for its growing importance.

Looking for More?
Visit www.phoneplusmag.com/ebooks to download the full report on the PHONE+ 2010 Channel Compensation Survey, including detailed analysis and graphic representations of the data collected.