Google Irks Partners With Slashes to Workspace Renewal Discounts

In a surprise move, Google is cutting partners’ Workspace renewal discounts by 40% and refocusing on new account acquisitions; the move could put Google’s recurring-revenue model at risk.

In a move that surprised channel partners, Google announced that it’s slashing the renewal discounts on its popular Workspace productivity suite by 40%, effective April 1. The move comes as Google pivots more of its channel rewards and incentives to new customer acquisition. The sudden change ruffled the Google channel and provided another example of how not to look at the recurring-revenue model.

Google pioneered subscription-based cloud productivity apps in the channel, offering partners a generous margin for selling and supporting Software-as-a-Service (SaaS). For the most part, Google pricing and discounts through the channel have been stable for years, providing partners with a steady and predictable revenue stream and cost model.