Cisco provided more details on the comprehensive overhaul of its go-to-market partner program, which will see the vendor take a dual-phase approach in aligning the subscription delivery of its products through its partner channels.

The Cisco 360 Partner Program was initially unveiled late last year. It’s targeted at consolidating the vendor’s various partner programs under one plan.

Rodney Clark, senior VP for partnerships at Cisco, noted in a blog post that the initial phase of the overhaul will begin on July 25. This will see the implementation of different incentive programs and changes to partner payout programs.

The new incentive programs will focus on providing a bigger reward for partners on “strategic offers and adoption-based incentives,” and “more earnings for high-quality assessments.” The current “Cisco Services Partner Program” will have its payouts changed and the “Monthly Value Rebates for Cisco Success Tracks” will be ended.

The full program overhaul will commence in February 2026, with the launch of the “Cisco Partner Incentive” program that will replace “multiple siloed programs.” Cisco will also be cutting the annuity payout on software and services and its “Delivery Rebate” program.

“I understand these changes directly impact your business operations and profitability,” Clark wrote. “That’s why we’re taking a measured, two-phase approach that provides stability while allowing time to adapt.”

Clark further tied the move to evolving market demands, pointing to subscription services accounting for 56% of Cisco’s total revenues during its most recent fiscal quarter, with software revenue growing 33% and software subscription revenues surging 39%.

The program changes also align with Cisco’s ongoing push away from one-and-done sales to a partner-reliant subscription model. This is based on using its channel partners to run those managed offerings for customers.

Cisco executives had previously noted that partners managed more than 90% of its managed services, and that it forecast the total addressable market (TAM) for those services would exceed $113 billion by this year.

Cisco CEO Chuck Robbins noted during the vendor’s most recent earnings call that it was already seeing some of that progress for its Splunk cybersecurity operations.

“We are beginning to see that and we’ll continue to see it as we go forward,” Robbins said. “I think you’ll see as we get into the next couple of quarters, you’re going to see more and more cross-selling sales incentives that the teams are putting in place that I think will continue to accelerate that.”

Can Cisco be more delicate than Broadcom? Cisco’s phased approach to its program overhaul will be closely watched in light of the more rapid approach taken by Broadcom following its acquisition of VMware.

That move saw Broadcom revamp VMware’s long-standing partner sales and distribution channel in favor of its Advantage Partner Program. The move was touted as a way to simplify interactions between VMware and its customers, however it also moved those resale partners into different tiers based on their sales pipeline.

Those changes drew consternation from some partners and industry analysts.

“These partners are mad,” Tracy Woo, principal analyst at Forrester Research, told SDxCentral. “They’re mad because they’re partners and they weren’t given more notice than like a day or maybe just an email and that was it. That is very Broadcom style, it’s very matter of fact and we don’t make any apologies for it.”

Equity research firm William Blair noted in a recent “Enterprise Tracker” report that some enterprises and go-to-market partners were continuing to look for ways to de-couple themselves from Broadcom and VMware. The report stated that value added resellers (VARs) had noted “customers are actively strategizing how to get off VMware, and the broader ecosystem (VARs, OEMs, ISVs) is moving away from VMware.”

That last point was bolstered by the research firm noting “newfound disillusionment from partners about Broadcom squeezing them on margins,” with a specific “partner that historically could expect to make 10 to 15 points of margin on reselling VMware is now making only 5 to 6 points.”

Broadcom CEO Hock Tan shortly after the program launch attempted to clarify the move and highlight benefits that included the ability to “deliver consistent customer experiences.”

“To ensure there is continuity of service for this smaller partner group, we will continue existing operations with this group under modified monthly billing arrangements until the white-label offers are available,” Tan wrote.

Tan also targeted past abuse of VMware’s sales partnerships, stating that the new program ended “upsell practices that were common in the software industry before the subscription transition, such as branding incremental features as new higher editions of the same product or new add-on products. These practices do not represent true innovation in core products, and cause customer confusion and frustration about missing out on new features. Subscription licensing eliminates these incentives.”

Prashanth Shenoy, VP of cloud platform, infrastructure, and solutions marketing at Broadcom, previously admitted that those changes did challenge customers and partners.

“With change comes challenges in terms of confusion, because when the pace of change and the amount of change is drastic, there’s obviously a definite confusion or challenge when we don’t communicate and articulate things in a broad amplified and consistent manner,” Shenoy admitted.

However, he added that those changes were necessary and a long-time coming.

“In the previous world, this would have taken us three to four years to make that change,” Shenoy said. “I joined VMware two years back and we tried this a few times, and we didn’t execute on that. So, for me, I was very glad to have made this business model transformation, portfolio transformation, route market transformation, all in a matter of months.”