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Symantec SaaS push will force channel to change

Symantec's new SaaS platform will make VARs become more like service providers and reward those that already are, experts say.

This week's debut of the Symantec online backup service is part of the antivirus vendor's long-range plan to make all of its software available as services in addition to standard implementations, according to Jeffrey Hausman, senior director of product management for managed and online services.

The increased emphasis on Software as a Service (SaaS) by Symantec and other large vendors will force channel partners to incorporate more service providing into their traditional roles -- but also bring new sales opportunities to those ahead of the curve, experts and value-added resellers (VARs) said.

"The challenge to the channel isn't that their jobs are threatened," said Jeff Kaplan, managing director of THINKstrategies in Wellesley, Mass. "Instead, the nature of their jobs is going to change."

 These types of changes, I see as an excellent opportunity for  the channel.
Adam Gray, CTO, Novacoast,

VARs that are not already in the managed services business will have a more difficult time adjusting to SaaS sales, said Paul Myerson, channel analyst for the Milford, Mass.-based Enterprise Strategy Group.

"It's a totally different DNA," he said.

Competition from direct SaaS sales?

The online backup service is the first offering of Symantec's SaaS platform, which it calls the Symantec Protection Network. The company is selling it directly -- for customers who want to manage it themselves through a Web browser -- and allowing channel partners to customize and manage it for their clients. The target customers are small- and medium-sized businesses (SMBs).

Symantec resources
SaaS offering a first for Symantec

Symantec channel overhaul makes all VARs equal

Symantec aims at SMBs with simpler product packaging, focused VAR support

"On the surface, it sounds like it could be a challenge [for VARs]," Myerson said. "But typically, business with SMBs is done through the channel anyway."

Chenxi Wang, a principal analyst with Forrester Research in Foster City, Calif., agreed that direct and channel sales will be able to coexist.

"I don't think this is going to make a significant change to the partner program," she said.

Adam Gray, CTO for Novacoast, a Santa Barbara, Calif.-based VAR, said he is not concerned about competition from Symantec's direct SaaS sales because the company worked with channel partners for months in advance to come up with a program that would meet their needs, not infringe on their business.

"It's like anything else," said Jonathan Dambrot, managing director for Prevalent Networks, a Warren, N.J.-based VAR. "We work with our clients. If our clients see value in what we bring, then I don't perceive [direct sales] necessarily as a threat."

SaaS brings new channel opportunities

Despite some VARs' fears about SaaS in general and competition from direct sales, others say it will bring new business to the channel.

"These types of moves and these types of changes, I see as an excellent opportunity for the service providers and the channel group," Gray said.

As Symantec adds additional services to the platform, existing customers will be able to move from software-only to a hybrid of software and SaaS, Hausman said. For example, current data-backup clients could still use their software to manage the system but store their data off-site at a Symantec remote center.

Because the SaaS is meant to be an add-on to existing services, it will not hurt VARs' traditional software sales, Gray said.

"I don't think that going to SaaS takes away from that," he said.

Some VARs fear SaaS because it makes IT easier to deploy and manage, while they have always "lived off the complexity of it," Kaplan said. Although the key benefits of SaaS seem to downplay the need for VARs and consultants, "there's still going to be plenty of opportunities for them," he said.

VARs can integrate different SaaS offerings into proprietary solutions they can tailor to meet the specific needs of specific verticals, including finance, healthcare, manufacturing and retail. They can also spend more time and money on adding value to vendors' SaaS offerings instead of on software deployment.

And when clients move to Symantec's online backup SaaS, it will make them realize the need for related storage services -- giving VARs additional sales opportunities, Gray said.

Potential conflict?

Symantec's foray into SaaS may cause problems with channel partners who already offer similar services themselves, Wang said.

"That is going to create a certain level of conflict," she said. "I've seen that in the larger [managed services provider] or [managed security services provider] community, and it always becomes a competition."

In most cases, the channel partner stops offering the service because it doesn't want to compete with a high-powered vendor, she added. But sometimes the vendor acquires the partner, or the two sides reach territorial non-compete agreements.

Prevalent Networks already offers disaster recovery SaaS and hopes to package it with Symantec's online backup SaaS, Dambrot said.

"I can see where some partners see it as a threat," he said. "I don't necessarily see it as that. I see it as a complement."

Myerson also has a more positive view: He said even VARs that offer other online backup SaaS can benefit from Symantec's entry into the market, because now they have a new option to offer clients.

"It's going to become a competitive environment, which is better for the VAR," he said.


Let us know what you think about this story; email: Colin Steele, News Writer.

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