Oracle and channel harmony are words that haven't always been mentioned in the same breath.

But there's nothing like a clean start. Oracle has reformulated its channel approach to support the recent North American launch of Oracle E-Business Suite Special Edition, a product tailored for the SMB (small and medium business) space. Special Edition is a "packaged offering" of Oracle E-Business Suite 11i business applications, implementation services, education and support to be sold through certified Oracle partners.

Prior to Special Edition's late September debut, Oracle had been working with partners on its channel strategy for about a year.

"We were looking for some exclusivity in territories," said Joel D'Arcy, president of Whitbread Technology Partners Inc., an Oracle Certified Advantage Partner based in Stoneham, Mass.

To that end, Oracle has carved out partner-only territories, according to Rauline Ochs, group vice president of North America Alliances and Channels at Oracle. In such territories, Oracle will not engage with its sales reps. The same policy will hold for Oracle Consulting.

"We are looking for partners to be the primary providers of implementation services in this space," Ochs said.

Oracle divides the United States and Canada into 20 regions, within which it is now in the process of defining partner territories, starting in the Northeast region. Within a particular partner territory, a Special Edition application sales manager will be responsible for the "care and feeding" of partners, Ochs said. The application sales manager only achieves his or her quota when partners hit theirs. The application sales manager reports to the same regional manager as those managers running territories covered via Oracle field sales reps.

In addition to the distinct sales territories, Oracle partners also were interested in "productivity tools to allow us to more effectively compete" in the small business space, D'Arcy said.

Here, Oracle tapped its consulting arm for software code that speeds the implementation of E-Business Suite, Ochs said. Oracle has packaged that intellectual property and made it available to partners.

Oracle is lining up other corporate resources behind its partners. For example, Oracle supplements partners with the company's direct telesales capabilities, Ochs said. In addition, Oracle systems consultants can make sales calls with partners' sales staff.

"As Oracle joins the rush to offer discrete products to the SMB market … we see it as having much of the same opportunity as other large IT vendors like IBM, EMC, HP and Sun," wrote Jim Balderston, senior industry analyst, in a Sageza Group brief. Sageza is a market research firm in Union City, Calif.

"These vendors," he continued, "as they move down-market, have an inherent advantage selling to smaller concerns as their products are widely deployed in SMB's most important customer base, the large enterprise. To do business with their most valued customers, SMBs of all sizes must speak the IT lingua franca of these larger enterprises if they are to participate in the value networks that allow them to respond in short order to their customers' demands."

But Oracle's SMB push may also help the company at the enterprise level. Special Edition's midmarket pricing could help Oracle establish beachheads among the subsidiaries or departments of larger organizations not currently in the Oracle technology camp, Ochs said.

Oracle's Special Edition channel push initially will be open to those partners that helped the company design its delivery model. Next, Oracle plans to work with partners that have expressed interest in Special Edition and have the training, skills and references to support the product, according to Ochs. In the last phase, the program will be opened to resellers that have not been Oracle partners.

Oracle's program is far too young to assess its effectiveness. It's a matter of wait-and-see. But Oracle has at least set the stage for cooperation, establishing protected prospecting grounds for its partners and marshaling resources to support them.