Jay McBain, the Principal Analyst – Channels, Partnerships & Alliances at Forrester Research, talks to roughly 500 companies about channel programs every year. If you think that is a lot, it just skims the surface, according to McBain, who has himself transitioned from a Channel Chief for Lenovo and Autotask to an influencer at Forrester Research during his career.
During the Jolera Interview Series, McBain recognizes more than 10,000 companies in the world that run some channel program. There are also approximately 175,000 software companies doing business, of which only 10 percent have a channel program.
If you add in the emerging technologies such as artificial intelligence, Internet of Things and Blockchain, to name a few, then there could be more than 800,000 other companies to add to the channel mix. Of the emerging technology companies, only 10 percent of those organizations are running a channel program.
All this activity leads McBain to one conclusion: “Channels are about to explode.”
According to McBain’s research, the transformation IT vendors and channel partners have gone through in the last 18 months is more than what business has seen in the past 39 years combined.
“Partnerships are changing, the way we go to market is changing, and customer behaviours are changing, the growth of marketplaces and ecosystems are becoming more important,” he added.
This is where the as-a-service market kicks in. Recent data captured from CEOs from several industries help paint a direction for the as-a-service world. McBain says that 76 percent of CEOs tracked in this survey believe their current business model will be unrecognizable in the next five years. The market is moving quickly to subscription and consumption-based models such as Netflix.
“Everything will be as-a-service whether it is driving a car, renting a forklift, or buying paper-clips. You have to be rethinking your business model for as-a-service.”
All this activity in the as-a-service market has led to the creation of super-marketplaces, McBain said.
He added that if there is one trend to focus on for Managed Services Providers (MSP) today, its super-marketplaces because they will impact the channel dramatically.
And most of these super-marketplaces we know already, such as Amazon and Alibaba. But, the COVID-19 pandemic has only escalated their relevance in the market, and now we learn from a joint Forrester/McKinsey study that super-marketplaces have grown more in the last three months than during the previous ten years combined.
“In the U.S. alone, about 1/3 of all the dollars in the economy flow through super-marketplaces. We predicted 17 percent of the IT industry would flow through super-marketplaces – that’s $3.6 trillion by 2023. What COVID-19 has done is driven that prediction to next year,” McBain said.
During the interview, McBain provided insights on the trifurcated channel, the lasting impact of the COVID-19 lockdown on IT, and who the winners will be in the age of the super-marketplaces.
Two decades ago, the term RMM or Remote Monitoring and Management was not in anyone’s IT vocabulary. Back then, Gavin Garbutt founded N-able Technologies in Ottawa and developed an RMM solution that fits well in the SMB market and created a new managed services economy for the channel.
Today, Garbutt is starting a new venture called Augmentt. Once again, creating a new channel of revenue for managed services providers (MSPs) with a Software-as-a-Service solution helps MSPs better understand their customers’ SaaS usage, apps, and the costs associated with those apps, identify shadow IT and enforce security policies.
According to Garbutt, Augmentt tries to solve the same problem that N-able tackled 20 years ago.
“The idea of N-able was started when I was at a cocktail party at Christmas time. I talked to a $5 million VAR (Value Added Reseller) and asked him if there was one thing, he could use that would propel his business forward from a profitability and operational perspective,” he said.
The business owner told Garbutt a remote monitoring tool that would inform him of issues ahead of time would be ideal. This type of tool could save the VAR precious time and money from dispatching a truck filled with technicians. This tool could also fix the issue remotely or pinpoint what equipment the technicians needed to bring for onsite remediation. Garbutt’s response to the VAR owner was solutions such as HP OpenView, CA Unicenter, and IBM Tivoli already existed for that. However, those solutions were all enterprise-grade and not well suited for small to medium-sized businesses.
“Eureka! Here’s an opportunity,” Garbutt said.
Fast forward 20 years and all those devices MSPs are handling have moved to the cloud, and the important part of IT is no longer monitoring the actual devices but the applications that run on them.
“So, my view is the next pivot is on cloud services and apps management. This is how MSPs can help customers improve their performance,” he said.
Garbutt does not consider himself to be a pioneer. Instead, he described himself as a person who worked to innovate industries. When starting N-able, he looked at the current landscape and saw the MSP model at 120 devices managed per technician and thought, how can I get that up to 1,000, while still improving service delivery?
“N-able started just after the Dot-Com bust. We tried to create technology to help VARs, at the time, move away from a reactive services model. Back then, their real value was to be inside the customer’s environment and work to fix things. We changed that with remote monitoring and management tools, which took those businesses to a new level. My aspiration was let us take the old model where we managed 120 devices per technician at $60 per month, per device and increase it to 800 or 1,000 per technician: still at $60 a device per month. That now increases your EBITDA (earnings before interest, taxes, depreciation, and amortization) profit by 20 to 30 percent.”
Garbutt’s approach to entrepreneurship is to “go big or go home” and to have the ambition that you can make a difference in a large industry or with a small business owner.
Also, during the interview, Garbutt talking about his experience starting a company during a worldwide pandemic. He also spoke about his leadership style in times of crisis and what the second “T” stands for in his new company Augmentt.
For Bill Brandel, the country chief executive of Ingram Micro Canada, acting fast to help the many thousands of channel partners that rely on Ingram Micro Canada for its supply of IT solutions became the priority for the long-time distribution executive.
Brandel has been the Ingram Micro Canada leader for just over four years. In that time, he has gained a great perspective in the marketplace because he deals with hundreds of vendor partners and thousands of channel partners. As Canadian business and society were heading into an unknown lockdown because of the massive spread of the Novel Coronavirus, Brandel understood that financing was going to be crucial if any of these businesses Ingram serves were going to survive.
He decided to explore corporate financing programs and found a U.S.-based plan called KickStart. Ingram’s normal course of action is to launch programs in the US and then bring them into other geographies such as Canada. Since Ingram Micro Canada is run autonomously, Brandel decided to take KickStart and Canadianize it immediately. Called Future Funds, it extends roughly $110 Million in additional credit to channel partners, while also waiving significant financial service fees. Future Funds also offers exclusive payment terms to solution providers who are members of Trust X Alliance and SMB Alliance communities.
“It was always important for us to get out of the gate with the COVID-19 lockdown. We could see right away that this was not going to be a quick thing that was going to pass through the market. We knew this was going to leave a long-lasting impact. The biggest challenge is managing working capital. Even without the pandemic, many companies were transitioning from a project-based business, which is a buy/sell relationship to an as-a-service or consumption-based model. Those models put a lot of strain on working capital as many companies have to purchase the hardware upfront to develop customer annuity buying programs,” Brandel said during the Jolera Interview Series program.
Brandel does see the light at the end of the COVID-19 tunnel. “I am the eternal optimist, and I do see the light at the end of the tunnel as things are getting better in Quebec, for example. BC is getting back to normal, and in Ontario, while we are more conservative, I am encouraged that we’ll get back to normal based on the good feedback I received from Quebec,” he said.
In this unprecedented time, the Buffalo-native has been amazed at the resilience of the entire Canadian IT community and how quickly they have responded to the pandemic and subsequent lockdown. “When you look at the impact this could have brought to channel partners, vendors and the supply chain… at one point it looked overwhelming, but this group has done an amazing job, and it speaks to the ingenuity of the customer base,” he said.
As a young adult, Ryan Narinesingh enjoyed taking things apart and figuring out how they worked. Building computer systems for small to medium-size businesses is how he got his start in the Canadian IT industry. It is this yearning to know and understand the inner workings of things that helped Narinesingh develop one of the more vibrant channel ecosystems for Veeam Canada, a backup solutions vendor that can deliver cloud data management.
The long-time channel leader for Veeam Canada embarks on a new challenge in his career, taking on the role of Area Sales Director for Veeam in Central & Atlantic Canada.
During an interview for the Jolera Interview Series program, Narinesingh said that his track record working with channel partners and building strong relationships would help him transition into the Eastern and Atlantic market, which has a unique set of challenges such as language and market size.
“I took on this new role because I want to get closer to the customer and see what challenges are out there. I want to find out what keeps these people up at night. We’ve been blessed at Veeam Canada to have more than 13,000 customers across the country, and many of these people chose Veeam. Some have said that Veeam solutions saved their jobs. I want to better understand why and help organizations who are struggling to succeed,” he said.
During his time building the channel for Veeam Canada, Narinesingh understood he was competing with several other backup vendors, but he credit’s Veeam’s three pillars – Growth, Technology and People along with a channel first strategy – that helped him gain a foothold with the channel community in Canada.
One of Narinesingh’s more audacious moves was developing a partnership with Jolera Inc., which enabled Veeam to go deeper into the as-a-service market.
He said that his lifelong drive to find out the inner working of things helped bring him to Jolera.
“I thought there were a lot of parallels with Veeam and Jolera. Both believe in partnership and leveraging the best of breed technology, tools, processes, and people to accomplish the end user’s goals. Today, customers are looking for that, and it’s inherent in the culture of Jolera. They are very familiar with the OPEX model and managing it all for the customer instead of just selling product X, and hopefully, it works out. They want to own the result and maintain strict SLAs; maintain uptimes for organizations, which’s a significant risk for an organization. Not all organizations what to take that on. Jolera was open and ready to take on this risk, and we have seen great results so far with the partnership,” he added.
Narinesingh believes these types of as-a-service partnerships will drive the market today and into the future. Recently, Veeam reported an annual recurring revenue increase of 20 percent year-over-year for the second quarter of 2020. Despite the COVID-19 pandemic and subsequent lockdown, this was Veeam’s biggest second quarter in the company’s 14-year history.
During the interview, Narinesingh talked about Veeam’s go-to-market strategy, the challenges posed by COVID-19, the rise of the remote worker, mentoring, activities in the community and his leadership style in times of crisis.
“You don’t know what you don’t know.” It sounds trite, but it’s true. You probably don’t realize that a dormant crypto-locker malware file is sitting quietly, undetected, on a computer or server. All it needs is the right moment or the right command. Like Clint Eastwood’s Dirty Harry character said in the movie Magnum Force: “A man has got to know his limitations.” Organizations – no matter the size – need to determine their limitations from a security standpoint.
Organizations that have not checked their overall cybersecurity posture are effectively asking for trouble. Broader vulnerability assessments and more targeted penetration tests are effective starting points from which to shore up cyber defences. Besides ransomware, which hit new heights during the COVID-19 pandemic, a major problem facing organizations is data breaches. Data breaches often lead to irrecoverable financial losses, reputation hits, business losses, talent losses, and general stress and embarrassment. There are many more reasons, but this list focuses on six reasons an organization should assess its security (in no particular order).
1. Identifying Risk Within the Organization
This should be a common practice for your IT team. It easy to be lulled into a false sense of security just because nothing bad has happened yet. It is foolish at best, and negligent at worst to take immunity from cyber threats for granted. Conducting yearly or semi-annual security risk assessments either internally or through a trusted partner will provide an extra layer of security insights, which can be used to protect against data breaches. Many of the threats affecting small and medium businesses aren’t even targeted. Like Covid-19, attacks move from one person or organization to another. No organization is immune to a talented hacker who is determined to infiltrate your systems for fun or profit, hackers look for security gaps, and you should do the same. By understanding and knowing what gaps you have, you can make most of the necessary fixes and take the low hanging fruit out of harm’s way.
To put it simply, there are two methods to assess security risk. The first is called a Penetration Test – more commonly known as a Pen Test. Pen Tests are an active attempt to hack or access networks, websites, applications, conducted by an ethical hacker – one of the good guys. It is a real cyber-attack that targets a specific area, or it can be broad and open ended. From this test, IT managers or chief security officers will get a detailed look at how well the security systems, networks and applications in place are performing along with identifying vulnerabilities within the system. It also informs the organization of their strengths and whether they are adhering to current compliance and security policies, which is also quite valuable.
The second method is called a vulnerability scan, and these tests are meant to be fast, passive, high, and wide across the organization. This approach compares a current state to accepted minimum standards, leading to a grade of how good your security is. These assessments take into account the currency and completeness of patching, availability of easily exploitable ports, scanning for known malicious applications, and susceptibility to common attack methods like SQL injections.
2. Avoid Security Breaches
Data breaches are expensive. According to the annual Cost of a Data Breach Report, conducted by the Ponemon Institute and sponsored by IBM Security, the average total cost of a data breach is just under $4 million US. For an SMB business, this would sound the death-knell. For mid to large enterprises, it can lead to a severe disruption in business that could have lasting effects. But depending on the type of organization, it could be worse. Ponemon found that for healthcare providers, a data breach averages $6.45 million. The average data record size for data breaches is an outstanding 25,575 records per incident, which would lead to a massive hit on any organization’s reputation and brand.
By conducting a security risk assessment and following through with the recommendations, you can better protect data and avoid the costs associated with a hack. A security assessment will focus on malware analysis, reverse engineering, cryptography, exploit development, offensive and defensive security. A well-crafted assessment will lead to a report laying out clear, actionable insights coupled with effective remediation steps to help organizations lower risk and identify areas requiring improvement.
3. Protecting Your Reputation
According to the Harvard Business Review, an extra star in a restaurant’s Yelp rating increases business between five and nine percent. On the flip side, negative reviews keep customers away in droves. A hit to an organization’s reputation because of a data breach or hack will have a similar, lasting impact, especially if it becomes public. In most cases, companies have to legally announce the breach based on PIPEDA and GDPR laws and regulations. Many organizations aren’t aware that they are subject to laws based on where their customers reside, not just where their corporation is physically or legally registered. The bottom line is that customers will avoid you, or worse, leave you.
Rebuilding a tarnished brand is expensive. By foregoing annual security risk assessments, organizations are gambling with their own future, and more broadly, risking their stakeholders – staff, suppliers, business partners, and company shareholders. It isn’t unheard of for direct and indirect victims to take legal action seeking compensation for their own damages. The fallout continues to staff and the ability to find and retain talent – nobody wants to work for an organization that shows itself to be somewhere between incompetent and ignorant. Share prices have been known to take a hit, which only serves to prolong and aggravate the pain of the original hack. One security breach can put an organization into permanent “Damage Control” that can take years to overcome.
4. Maintaining IT Budgets
Any good CFO should easily conclude that the cost associated with Pen Tests or Vulnerability Scans are a drop in the bucket compared to the wide-ranging losses stemming from a data breach. For example, Canadian businesses are now mandated to reveal if they have succumbed to a data breach if determined that the data under the control of the organization has the potential to fall into the wrong hands. A failure to report these breaches, even seemingly innocent violations, can lead to fines of up to $100,000 under the Personal Information Protection and Electronic Documents Act (PIPEDA). The majority of organizations do not budget for PIPEDA fines and the such. Potential lawsuits are also a factor and recovering data also eats into the budget. While some might be tempted to think that cyber security insurance will pick up the tab, think again. Merck & Co found out the hard way when their insurance company turned down their claim for $1.5 billion. By scheduling a security assessment, you can build that into your budget and avoid surprises. Your organization’s budget and cash flow are more at risk if you don’t invest in proactive systems and programs like; security monitoring, security identification and event management system (SIEM), or Layer 7 firewalls, and often most overlooked, user education.
5. Avoid Violating Privacy and Data Laws
As in the previous reason, six-figure fines can be avoided by an annual security risk assessment. The PIPEDA fine is a six-figure sum, and penalties from other compliance/privacy acts are not cheaper. Violators of the GDPR (General Data Protection Regulation for the European Union) can risk fines of up to 20 Million Euros. Then there’s SOX (Sarbanes-Oxley Act), HIPAA (the US Health Insurance Portability and Accountability Act), and there are even state-run laws such as CCPA (California Consumer Privacy Act). Then, there is the LGPD, a new act that comes into effect next month from Brazil. LGPD stands for Lei Geral de Protecao de Dados Pessoais) or Brazil’s General Data Protection Law. LGPD, like the EU’s GDP protects Brazilians’ data, no matter where that data is stored. Think about a Brazilian tourist shopping at a store using a credit card, then the store being hacked leading to credit card fraud against the tourist. In theory, the store is liable for those damages. The efficacy and implementation of these laws remain to be seen, but there are other punitive measures countries can take against offenders such as blocking their websites at a country level.
6. Increase Productivity Levels
Finally, if your organization is infected with a virus or hit with ransomware your employees’ overall performance and productivity will suffer. Take a minute to think about how effective your business is during a power or internet outage. Now multiply that by the number of days and add some indirect costs and future losses for good measure. By doing a security assessment and implementing up-to-date security protocols, you ensure productivity levels, while reducing risks. According to a Ponemon, the most significant impact of an attack may be in end-user productivity losses because the IT systems are not functioning. As organizations embrace digital transformation and cloud-based systems along with the rise of the remote worker because of the COVID-19 pandemic, this risk only increases. SaaS models mean businesses are now subject to multiple sources of failure in their operations and activities. Imagine if a cloud hosted accounting suite were taken offline by hackers – no invoices, no cash tracking and much more.
Jolera has a variety of assessment options available to help identify possible weaknesses and exploits and determine possible real-life outcomes of a successful attack. If you’re interested in learning more contact usfor more information.
Researchers released new information of a vulnerability in the Integrated Dell Remote Access Controller. iDRAC is designed to allow IT administrators to remotely deploy, update, monitor and maintain Dell servers without installing new software. Path Traversal vulnerability CVE-2020-5366 has a 7.1 score which reflects a high degree of danger. Although the vulnerability was fixed earlier in July, by exploiting the flaw, remote attackers could take over control of server operations.
To monitor threats against company servers, it’s crucial to have a managed security program in place. With services like Secure IT – SIEMyou can rely on a team of security experts who perform remediation, root cause analysis and provide security recommendations to help you defend against malicious threats.
A high-severity vulnerability in Cisco’s network security software could comprimise sensitive data. The flaw exists in the web services interface of Cisco’s Firepower Threat Defense (FTD) software, and its Adaptive Security Appliance (ASA) software. The vulnerability (CVE-2020-3452) allows attackers to conduct directory traversal attacks, which is an HTTP attack enabling bad actors to access restricted directories and execute commands outside of the web server’s root directory.
The vulnerability affects products if they are running a vulnerable release of Cisco ASA Software or Cisco FTD Software, with a vulnerable AnyConnect or WebVPN configuration. To eliminate the vulnerability, Cisco users are urged to update Cisco ASA to the most recent version.
North Korean-backed hackers tracked as the Lazarus Group have developed and are actively using VHD ransomware against enterprise targets. VHD ransomware samples were found between March and May 2020 during two investigations, being deployed over the network with the help of an SMB brute-forcing spreading tool and the MATA malware framework (also known as Dacls). The ransomware tool creeps through the drives connected to a victim’s computer, encrypts files, and deletes all System Volume Information folders.
Organizations must have 24/7 monitoring and remediation solutions in place to defend against VHD Ransomware and similar threats. Secure IT – Endpoint Protection and SIEM help to avoid, or at least isolate these attacks from spreading.