“We are planning to make major enhancements to our NextWave partner program globally due to market changes that are transforming the cybersecurity landscape.
As we usher into 2022, it’s time to look back and take stock of the channel performance of leading vendors and distributors and the key achievements and take-aways from the Channel Market. More than this, it’s pivotal to get a hang of the key predictions for the Channel Market for the year 2023.
The year gone by will go down the memory lane as a year of mixed experience. Starting from the widening market opportunities to a somewhat visible respite from the raving pandemic, from being the year of Europe’s greatest war since World War II that pushed the pandemic-battered global economy and the European markets into recession to a year of greater cybersecurity concerns — 2022 has seen it all.
In a series of interactions with the poster-boys of Indian IT, SME Channels embarks upon understanding how leading vendors have fared in the year goneby; what drives their growth engine; the key milestones for 2023 set from the channel perspective; key channel predictions for the New Year; direction for channel partners and their growth roadmap for 2023.
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“Our channel partner ecosystem thrives globally across all key performance indicators, including partner-initiated bookings, pipelines, and new customers.”
Krithiwas Neelakantan,
Channels & Alliances Leader,
Palo Alto Networks
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We spoke to leading Cybersecurity player, Palo Alto to get a sneak peek into its performance in the channel market and its key channel predictions for 2023.
Palo Alto Networks’ Channels & Alliances Leader Krithiwas Neelakantan has been spearheading channel initiatives for the company in the security market. He manages channel operations and continues efforts towards turbocharging the company’s channel networks in India. Armed with extensive experience in the channel market, Neelakantan has been instrumental in driving Palo’s growth momentum in India.
In an exclusive chat with SME Channels, Krithiwas Neelakantan, Channels & Alliances Leader, Palo Alto Networks, reveals his company’s key channel Predictions for 2023, major achievements and the unique matrixes that design his seminal vision for the Partner Ecosystem. Edited Excerpts:
Please give a brief introduction of your company.
A global cybersecurity leader, we are today, shaping the cloud-centric digital future with technology that is transforming the way people and organisations operate. With a customer base of over 85,000, we are present in 150+ countries across multiple industries. 90% of the Fortune 100 and more than 71% of the Global 2000 rely on us to improve their cybersecurity posture. Our total revenue for the fiscal first quarter 2023 grew 25% year over year to $1.6 billion, compared with total revenue of $1.2 billion for the fiscal first quarter 2022.
We have been consistently ranked as leaders in the space, including as a leader in the Gartner Magic Quadrant for Network Firewalls 10 consecutive times. We have also been recognized as a leader in the 2021 Gartner Magic Quadrant for WAN Edge Infrastructure. We partner with Tech Mahindra, Accenture, Alibaba, Amazon Web Services, Google, Microsoft, Proofpoint, PwC, Splunk, Tanium, and VMware. We were also recognized by Global support organisations (Americas, EMEA APAC, and Japan) for our exceptional services and for delivering deep tech, cutting-edge cybersecurity solutions through an integrated platform across clouds, networks, and mobile devices. Last year we also expanded our threat research team, Unit 42, that was formed in 2014, with an addition of a new cybersecurity consulting group that aims to help enterprises respond to emerging threats as they navigate an increase in costly, crippling cyberattacks.
As the war in Europe refuses to end anytime soon and China bubbles with uncertainty and the world economy yet to come out of the pandemic shock, what major market trends would you forecast for 2023? What key mega trends do you foresee emerging in the channel market?
Over the course of 2022, enterprises across industries and regions saw an increased incidence of cyber-attacks thanks to new, extremely disruptive threats. Cybercriminals used ransomware to target critical infrastructures and found new ways to exploit the cryptocurrency boom, hybrid working, and, more recently, unsecured APIs. Per Palo Alto Networks’ latest ‘What’s Next in Cyber Survey,’ almost all APAC respondents admitted their organisation experienced cybersecurity incidents and data breaches in the past year, 11 on average. In India, 48% of organisations experienced at least 3 – 9 cybersecurity incidents or data breaches in 2022. These developments will keep exceptional cybersecurity providers in demand and, by extension, their channel partners.
Here are the 5 major trends we expect to emerge in the channel in the new year:
- Accelerated 5G adoption will deepen vulnerabilities: 5G connections in India are expected to reach 88 million by 2025, according to a recent report by GSMA. While the spotlight is currently focused on delivering higher data speeds, latency improvements, and the overall functional redesign of mobile networks, the cloud will expose the 5G core to cloud security vulnerabilities. With only 14% of Indian organisations equipped with a plan for securing their 5G/4G environment, CISOs will need to work with channel partners closely to ensure that every security concern stemming from the shift to this network is covered.
- Securing connected medical devices will be critical: Digitisation has enabled new healthcare capabilities such as virtual healthcare and remote diagnosis for healthcare firms. But as recent large-scale attacks in the domain have proven, the prevalence of legacy and sensitive data will make healthcare an attractive target for cyber threat actors. Channel partners will need to lend their extensive industry know-how – and in some cases even acquire the industry know-how from scratch – to ensure that large attack surfaces and patient data are safe from threat actors.
- Cloud supply chain attacks will disrupt businesses: Log4J recently demonstrated how many organisations can be affected due to a piece of dependent code embedded into the software packaging process. Cloud-native architectures,that are also consuming third-party code in their critical applications, will render the entire cloud supply chain vulnerable. As enterprises accelerate the shift to cloud, channel partners will play a crucial role in future-proofing these cloud architectures by ensuring that security is integrated from the ground-up. They will also be required to translate the risks involved in moving to the cloud and deliver solutions that are up to the mark.
- The debate on data sovereignty will intensify: As the world becomes more reliant on data and digital information, the volume of regulations and legislation emanating from a desire to control and protect citizens and ensure the continued availability of critical services will increase. As a result, the conversations around data localisation and data sovereignty will likely intensify in 2023. Consequently, partners may be tasked with helping customers understand the fine print of new data and security policies and how they may impact the enterprise.
- Metaverse to be the new playground for cybercriminals: With an estimated $54 billion spent on virtual goods every year, metaverse could open up a new playground for cybercriminals. The immersive nature of the metaverse will unlock new opportunities for businesses and consumers alike, as it will allow buyers and sellers to connect in a new way. Companies, and cyber attackers in tandem, will take advantage of mixed reality experiences to diversify their offerings and cater to the needs of consumers in the metaverse. Considering how the metaverse is still in the development stage for many enterprises in India, it will be essential that channel partners stay ahead of the curve in gaining an understanding of the medium. This will go a long way in aligning the solutions portfolio as needed and in helping customers meet any security concerns that may crop up post implementation.
Which areas do you want to focus on in the channel – skillsets – sales and marketing, vertical and technology practice development, service capability, etc.?
Our channel partner ecosystem thrives globally across all key performance indicators, including partner-initiated bookings, pipelines, and new customers. As we transform and grow as a company, we plan to continuously assess our channel strategy in relation to global markets, customers, partners, and company dynamics. Our future success depends on our ability to build lasting relations with partners who share our vision. Therefore, pushing partners in our NextWave program to maximise profitability by embracing new technology, developing product-specific expertise, and leading with services, will be at the top of the agenda. The focus areas to achieve this will include:
- Enabling differentiation through vertical-oriented specialisations
- Enhancing profitability through incentives, rebates, and deal referrals
- Expanding opportunities through growth initiatives
- Empowering success through industry-leading value-add services
What are your expectations from the channel this year?
Our channel ecosystems across the globe are seeing a significant move towards security consolidation. Customers are prioritising network security and cloud transformation, which will impact the Security Operations Center (SOC). Considering how they want to navigate these changes without any added complexities, this will be a key focus for service providers in 2023. The next big evolution in cybersecurity would be Artificial intelligence (AI), data and natural language interface. The implications of AI and automation will enable customers to do more with less due to the ongoing cybersecurity talent shortage.
The demand for solutions that can supplement this technology and automation focus will be key in channel trends in 2023. Furthermore, as advancements in the global threat landscape intensify, the world’s largest organisations are finding themselves under attack more frequently. Nation-state attacks and cybergangs are gaining ground and even targeting supply chains, causing detrimental damage to organisations and their basic functioning. In this scenario, countering any breaches will need an all-hands-on-deck approach, which could bring significant evolutions to the partner landscape.
Are you planning any new product addition for the channel market?
We are planning to make major enhancements to our NextWave partner program globally due to market changes that are transforming the cybersecurity landscape. We plan to move separate global partner programs into the NextWave banner and create offerings that help partners specialise in specific product and service niches. This will drive new possibilities for partners looking to specialise in specific product and service niches as they pursue stronger partnerships with us. We also plan to add new specialisations to NextGen hardware for firewall, NextGen software for firewall, and Cortex XSOAR. This will empower partners with a competitive edge that could help them land new businesses. Ultimately, the changes we unveiled over the next year will affect the entirety of the partners ecosystem, including managed security providers, distributors, and cloud-service providers.
Is there any channel expansion plan in terms of numbers in 2023?
Our channel network comprises 10,000 excellent partners that represent the varied marketing channels associated with Palo Alto Networks. In the new year we endeavour to align with them all toward a shared direction. Deploying best-in-breed security through major cloud providers will be a key expansion strategy as we seek to appeal to a wider base of cloud-focused enterprises. The role of partners will also transition from that of being resellers to being more service-led. This is being driven, in large part, by market realities, such as the widening cybersecurity skills gap. To meet this trend effectively, we will equip our channel partners with the skills and capabilities essential from a consultative standpoint so they can help customers develop their security infrastructures at any stage be it deployment or lifecycle management.
