Monday Morning Impact – April 9

Canalys: Security-as-a-Service Grows 21% Amid Struggles with New Revenue Models

Last year saw a steep increase in the adoption of security-as-a-service, according to the latest research by Canalys. However, this fast change in revenue stream is creating headaches for vendors who have to rework 2018 forecasts to avoid disappointing investors.

Security-as-a-service registered strong growth in 2017 at 21% to US$4 billion, following the rise in adoption of cloud solutions for enterprises. This growth was double the pace compared to the rest of the security market with software and hardware growing respectively 5% and 10% year-on-year to reach $27 billion combined. Canalys estimates the total security market was US$31 billion in 2017, up 10% overall. The researcher predicts continued growth through 2018 and 2019, as vendors keep improving their portfolios and delivery method.

“The ability to buy these products from public cloud providers and channel partners (e.g., AWS marketplace) has also reduced the complexities of deploying security products and, at the same time, provided a more flexible billing process, as the customer can add and remove seats monthly,” explained Canalys research analyst Claudio Stahnke.

But this rapid shift towards a subscription-based revenue stream is posing challenges for vendors, especially when it comes to reporting their results to shareholders. A number of key players missed their Q4 2017 revenue targets because they underestimated the adoption of security service offerings.

Channel Impact^®
This data suggests that MSSPs and channel partners are not only looking at solid growth potential in the security-as-a-service space, they’re also seeing additional opportunities in forewarning vendors about the need to manage expectations.

Verizon Updates Partner Program

The Verizon Partner Program (VPP) has been updated with an eye towards increased portfolio flexibility and overall agility, as well as to better address the ongoing evolution of the indirect channel.

Program updates updated channel engagement models intended to enhance flexibility; a simplified fee structure for US Agents, based on Total Billed Revenue; expanded US coverage resources; and expansion of the company’s global resale model by adding more partners and available solutions.

“We are deeply committed to helping connect our members with the right resources to address customer needs,” said Bill Hooper, director of the SMB Partner Channel for Verizon Business Markets. “As our program expands, we felt it was time to take it to the next level. Our updated model enables us to work with customers as effectively and efficiently as possible. We view this as a natural evolution to our program, and an obvious step to help our VPP members and customers. This program was designed to respond to the way companies buy technology solutions in today’s marketplace.”

Program updates began on April 2nd, and will continue throughout the year.

Channel Impact^®
The updated program is designed to give program members easier access to Verizon’s enterprise product portfolio, including networking, machine-to-machine (M2M), advanced communications, and security solutions.

Acronis Streamlines Partner Program for Distributors and Resellers

Acronis, a Burlington, Massachusetts-based company specializing in hybrid cloud data protection and storage, has rolled out a new partner program intended to drive increased profitability and deeper channel relationships.

The new three-level program builds upon its predecessor with increased deal registration rates, and more attractive sales rebates. The program also provides marketing development funds and gives free licenses to all partners in order to stimulate channel use of Acronis technology. Other benefits include a partner locator, exclusive channel promotions, free sales/technical training and phone/chat support.

“Our Partner Program ensures those resellers and distributors, who are at the core of our business, have a state-of-the-art program that gives them an easy-to-use process for increasing margin and profits,” said Pat Hurley, Americas general manager at Acronis. “Previously, we had various incentives for various products, including margin, rebates, deal registration and accelerators. Now we are making it simple – straightforward margins and rebates based on the level of partner in the program.”

The company’s product line spans backup, disaster recovery and file sync/share. Acronis Backup 12.5 provides backup capabilities for more than 20 different environments, including Amazon AWS, Microsoft Azure, VMware, Microsoft, Red Hat, Citrix, Oracle, and mobile operating systems.

Channel Impact^®
This redesigned program is intended to provide value for the channel through a simplified incentive scheme for enhanced profitability and ease of use.