March 1, 2010 / 9:08 PM / 10 years ago

NetSuite woos Microsoft resellers with commissions

* To pay 100 pct of first year’s revenue on 2-year contract

* Part of bid to expand network of external resellers

BOSTON, March 1 (Reuters) - NetSuite Inc N.N, which makes Web-based business accounting programs, is offering software resellers commissions to promote its products over those ofbigger rival Microsoft Corp (MSFT.O).

NetSuite, majority-owned by Oracle Corp ORCL.O Chief Executive Larry Ellison, said it will give software resellers in North America commissions equal to 100 percent of the first year’s revenue on new contracts when they sell two-year subscriptions to its products.

Resellers will receive 10 percent of annual revenue in subsequent years, NetSuite Chief Executive Zach Nelson said in an interview on Monday.

The company currently pays resellers an annual commission of 30 percent.

“We wanted to do something much more aggressive,” Nelson said.

The move is part of NetSuite’s drive to compete against Microsoft, which offers a rival line of accounting software for small-to-mid sized companies.

NetSuite employs 130 sales reps and works with about 200 outside resellers. Nelson estimated that Microsoft has 1,000 to 2,000 companies reselling its software.

All of NetSuite’s products are hosted at the software maker’s data center and delivered to customer’s via the Internet.

Microsoft has traditionally sold accounting programs that are installed on computers inside the customer’s own data center, though it has started selling web-based software in recent years.

Nelson said that he will recruit resellers from companies that currently sell Microsoft programs. (Reporting by Jim Finkle, editing by Leslie Gevirtz)

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