Channel needs to make its decisions on cloud in 2018: Palo Alto Networks

Palo Alto Networks Canadian country manager Rob Lunney emphasizes that both the opportunities and dangers of the cloud for the channel are greater than ever, and partners need to be proactive in adjusting their business models to the future.

Rob Lunney, Palo Alto’s country manager in Canada

Palo Alto Networks has reinvented itself to adjust to the opportunities – and threats – of the cloud. Their channel needs to be similarly aggressive in adapting to the rapid changes taking place in the cloud world, or be displaced by either competitors or hyperscale cloud providers. That’s the view of Rob Lunney, Palo Alto’s country manager in Canada.

The inexorable rise of the public cloud has been a key theme of 2017, and one that will continue in 2018, Lunney stressed.

“We are continuing to see customer interest progress and implementation in the move to the public cloud – as well as the building out of private cloud capabilities,” he said. “Customers see efficiency there, and as their confidence and experience grows with public cloud, they find new workloads to move there. We are now seeing second and third waves of tools built with agile development tools, which are growing in public cloud environments.”

A key challenge is to both work with – and stay ahead of – hyperscale cloud vendors who continue to add services that displace both vendor and solution provider partners. AWS – a strong Pal Alto Networks partner – was particularly active on this front at their recent re:Invent event a month ago.

“I was not at the AWS event, but was told that at the end of each day, some of the vendors in attendance closed their booths because AWS had just introduced the same service they provide as a new AWS service,” Lunney said. “Everyone runs the risk of being disrupted. These large cloud vendors bring value to the products –  and drive stickiness –  so we need to work with them. At the same time, we also have to work to stay ahead of them, to provide the services we provide better than they possibly can. We have a larger set of threat intelligence capabilities and more security experience than any of the public cloud providers.”

While AWS in particular advocates an all-in strategy on public cloud, stressing that following a hybrid strategy will simply leave one behind their more forward-thinking competitors, Palo Alto Networks – like most IT manufacturers – advocates a hybrid cloud strategy.

“Customers will need for the foreseeable future to work with an integrated security platform that encompasses both public and private cloud,” Lunney stated. “AWS is fervent on the public cloud. Even as much as we have seen customers move in that direction in some workloads, they still haven’t gone all-in. These customers are ‘cloud first’, not ‘cloud only.’ So they want their security solutions to span public and private clouds, as well as to manage their SaaS providers and manage their endpoint and existing networks. Going with AWS-only for security doesn’t solve any of your on-prem security problems. Customers are rewarding us with their confidence that an integrated on-prem and off-prem strategy is the way to go.

“It’s inherent on all of us to understand hyperscale cloud provider directions – but not necessarily accept the inevitability of their plans,” Lunney continued. “We all have to determine our own destiny, and take a proactive role in their great shift of the cloud.”

Lunney said that Palo Alto Networks itself has actively been moving towards this objective.

“We have the changed way that our products are both built and consumed to adjust to the cloud,” he said. “Customers who need to burst can rent our firewalls by the hour now, the same way they rent VMs by the hour. They don’t have to build to the peak and own to the peak. Virtual firewalls are a massive growth area for us.”

Palo Alto Networks has also been emphasizing this message to its channel.

“The inevitability of change is something that is easy to predict, and when we talk with partners, that’s at the heart of the vision of the future,” he said. “They know their role is an integrator with their customers. Hardware still has a long tail, but has been moving away from growth for a while. The future is helping them move to the cloud and extracting value from that. If they try to bring siloed solutions, their customers will lose agility, flexibility and economics.”

Last June, the company announced their new Palo Alto Networks Application Framework, a new consumption model which lets developers write apps to the Palo Alto security platform using cloud-based APIs, which are then able to be adopted as a cloud-delivered security app within the consolidated platform. Palo Alto services in turn automate the process and provide threat intelligence ingestion and syndication.

“We advocate for a new platform approach, and our large partners in particular see the value of that,” Lunney said. “Consolidating point products increases their value proposition.”

Two types of partners in Canada are particularly all-in with this approach, Lunney said.

“Enterprise-focused partners know that to follow the value proposition of public cloud, they have to simplify the migration of workloads to the cloud, with simplicity and automation,” he indicated. “Those are our principles, as they are for any integrated platform. Scaling down the options with this makes sense for these partners.”

Not surprisingly, the second group that sees the value in the new platform approach is the born-in-the-cloud providers.

“They aren’t as focused on resale, as they are on services and royalties for moving customers across to the cloud,” he said. “They care more about the technology and design, and less about the resale. They are focused on projects that help customers migrate faster.”

Lunney expects to see a lot of movement by partners in Canada in 2018 in terms of evolving their cloud models.

“I think we will see some maturity in the market in terms of decisions by partners who want to be in managed security and help with the move to cloud,” he said. “I think this will lead to more separations in the market. Decisions on the cloud will have to be made in 2018, and delaying them will delay the ability of partners to join later. More customers will add more cloud workloads, and will need more next-generation firewalls.”

Lunney noted that some of their partners’ rethinking of their business models to cloud have led them into management of mobile devices, as some traditional players have moved out of that space.

“Our largest partners are evolving to provide more managed services, in search of recurring revenue, and providing higher-level services like SOC-as-a-service to their customers,” he said. “There has been  good purchase and uptake in those areas. Partners who can deliver those services can fill a gap for customers.”