Palo Alto’s Michael Khoury on what’s actually changing for partners in the NextWave revamp

Robert Dutt: Hello and welcome to In The Channel from ChannelBuzz.ca, bringing news and information to the Canadian IT channel community for the last 16 years. I’m Robert Dutt, editor of ChannelBuzz.ca and your host for the show.

If you’re a Palo Alto Networks partner, or you’ve been thinking about becoming one, you’ve probably been hearing about the NextWave Partner Program revamp that launched in early February. It’s being called the first ground-up redesign of the program in about three and a half years, and the changes are significant. A shift from rewarding transactional volume to rewarding platform adoption, the elimination of discount caps that were leaving money on the table for partners, new diversification requirements, and a whole new approach to how Palo Alto thinks about managed services.

My guest today is Michael Khoury, Vice President of Global Ecosystems Programs at Palo Alto Networks. Michael is essentially the architect of these changes. He joined the company, did a listening tour of what partners were actually frustrated about, and the revamp is his answer to what he heard. We got into the details of what changed and why, the real economics of the new incentive structure, what the 30% non-firewall requirement means for partners who’ve built their business around firewalls, how mid-market MSPs and resellers fit into a program that could easily be optimized for global SIs, and what the recent CyberArk acquisition means for the partner ecosystem going forward. Michael brought real data and real candor, and I think you’ll find it genuinely useful.

Let’s get right into it, my chat with Michael Khoury.

Robert Dutt: Michael, thanks for taking the time. I appreciate it.

Michael Khoury: Thank you, Rob. Great to be here. Thanks for having me.

Robert Dutt: It’s been about three and a half years, I guess, since the last major partner program update for you guys. What changed in the landscape, or in what you’re hearing from partners, that made this the moment to do a kind of ground-up revamp rather than a refresh and update kind of motion?

Michael Khoury: Yeah, great question. Rob, I joined Palo Alto Networks about 18 months ago, and what I did, in addition to getting the internal feedback obviously from the various team members and various stakeholders, I made sure to go out on basically a tour, a listening tour, meeting with partners and getting their input frankly about our program at the time and what are the areas we needed to address.

It was obvious to me in a lot of areas we had some challenges that we needed to address as a company. I’d put these things in a way – it’s not like what we had was necessarily bad, but it just didn’t evolve with the way the business kept transforming and evolving. So we needed to update. And if you’ve seen this, probably you’ve seen it with other vendors – it’s kind of common in our industry that every few years you need to evolve the program to keep pace with the business needs ever changing.

And as I met with partners – and I met with partners across the globe, various regions, some of them were virtual, other meetings were in person, some of the meetings were larger like partner events that we hosted – the consistent feedback that I kept hearing was this.

Number one, it was around “Hey Palo Alto Networks, that’s great that you have a program, but it feels like we need you for everything. We need someone at Palo Alto Networks to do anything with you. So we’re always relying on you to get things.” And those things can be as simple as if we needed to get a quote, if we needed to get a price, if we needed access to more training – we always needed someone at Palo Alto to give us that access. That was consistent feedback number one.

Number two, obviously when we got into the program it was particularly with the managed services motion, because that motion has been growing for us at a much faster rate – and I’ll give you some percentages in just a minute – but that motion has been growing at a much faster rate than the traditional VAR motion. So when we discussed with the managed services partners, they were like “Hey, you kind of have a managed service program, but it kind of works like resale, not like truly like a managed service.” So we needed to revisit that.

And then obviously the other areas that our partners care about – for partners who provide services, how do we ensure we’re leveraging more of their capability and training them and giving them the right support from a training and enablement perspective so they can build not just a go-to-market motion but also their services around Palo Alto Networks.

And lastly, the last area was around the incentives. It was only two years prior to me joining the company that the company – and you’re right, you said three and a half years ago – which was the time when the company launched their first rebates program to partners. However, the feedback that I heard from partners, they said “Michael, you have rebates, you have these incentives for us, but they’re mostly on paper. It seems like it’s very hard for us to earn these incentives.” So we had to open that up and revisit that.

So overall, Rob, those were the big themes that I heard from partners and why we needed to evolve the program with bigger changes, and why we did the things that we did and we launched the recent program.

Robert Dutt: You’ve talked about moving from rewarding transactional volume to rewarding the platform and selling across that. Can you walk me through what that shift looks like concretely for a partner? If I’m a reseller who’s been doing well selling Palo Alto firewalls, what’s different about how I engage with you guys under this new program versus the old one?

Michael Khoury: I found – and this is by the way common across the industry – because sometimes a vendor builds a program and sometimes they look at it almost like a static thing. “Oh, we built it, here’s the requirement.” And sometimes you have to also look at where your own field sellers are measured on and what they need to do. Because if you have the company field sales organization and the partner organization that are not in perfect harmony in terms of what they focus on and what they need to work on, then you end up having more friction.

So as we evolved the program, we looked at our expectations from our sales teams and we said “Look, we expect our sellers not just to sell our firewall, but we expect them to support the platformization strategy,” which Nikesh talked about a few years ago. And now every company says “Oh, I have a platform too.” But if you think about that concept of we’re not just a firewall company – yes, that is our history, that’s our legacy, that’s where the company started – but when you evaluate our business, when you look at our next-gen security growing around 34-35% year on year, that’s been a big growth engine for us.

So as our field sales organization started to focus on embracing the platform, which means if you look at our product platforms, you have the network security, the NetSec part of the house, where you have the firewall, but you also have SASE, which includes SD-WAN and Prisma Access. And also you have what we call our SOC transformation, which is our Cortex product, which is also part of our next-gen security. And under Cortex you have XSIAM, which is the next-generation SIEM. You have XDR, which is around endpoint detection. And then recently we added identity as well, as you know, with the CyberArk acquisition closing last month.

So as we looked at all these things that our field sales organization is going to be measured on, when I looked at our program, there were no requirements toward those next-gen security platforms. It was mostly like if you can do firewall and keep doing firewall – which is not bad, it’s totally fine, we love those partners who continue to embrace us on the firewall side – but we also said in the new program, if you want to be driving bigger growth with us and being more aggressive, you need to do more across the platform. Meaning you need to embrace our SASE, you need to embrace next-gen security around Cortex, you now need to also embrace identity.

So now the partners who play with us across the platform can unlock better benefits and have more leverage. And we continue to say, look, if you focus only on one area of the business you can excel, whether you focus on identity or you focus only on firewall, you can excel with us, but that will be your lane. That will be kind of your swim lane. Obviously the partners who are more strategic, who embrace the platform, will be able to unlock more.

So what we simply did in the program, Rob, is we said now partners have requirements where they have to meet toward the next-gen security, where in the past there were no requirements. We put specific requirements. It’s very clear what they need to do. And then secondly, what we also did in addition to requirements, we also built the incentives and the rebates that support that motion.

So we’re basically telling our partners we’re looking at both sides of the puzzle. And I’ve always talked about programs – people ask me “Michael, what is a partner program?” Frankly, for me it’s a value exchange. On one side you have the requirements of what we expect as a vendor from our partners. And on the other side, what do we offer them in return? What’s in it for them? And the way I look at this, where the two meet in the middle – where the requirements meet the benefit and the incentive – that’s the program. So every program, in order to be successful, needs to have both sides. We made sure in our program we updated the requirements, but we also updated the incentives that go with that.

Robert Dutt: A couple of things coming out of that in different lanes. You mentioned setting those goals that folks have to reach outside of firewall and making that a requirement for the first time. You’ve said that 30% of revenues need to come from non-firewall lines of business within 18 months for you to reach both Platinum and Diamond, if I’m remembering correctly. That’s a real requirement. What happens to a longtime, loyal firewall-heavy partner who can’t or doesn’t get there? You say they have their lane, but what does that path look like? And the other side of that – is 18 months realistic for partners who need to build new practices around Cortex or Prisma or the other next-gen areas?

Michael Khoury: So look, we’ve done the analysis across our partner ecosystem. And what I found when we did the analysis, even over a year ago versus when we did it recently, we already saw a shift. We already saw an increase over just the first year, even before we launched the program, because we started to signal especially to our key, bigger strategic partners.

And you’re right – at the Diamond level we require 30% of their business to come from next-gen security. But the Platinum level is a little bit lower, it’s 20%. So it’s not as high of a bar. And obviously for the Innovator level, we did not put a specific requirement. We felt those partners are smaller in nature, maybe they’re focused on a specific area, they’re still building their business model. We didn’t feel we needed to necessarily be very prescriptive with our requirements in that area.

In terms of the 18 months, when we looked at our partners – if I have a partner who’s already, let’s say, a Diamond and doing 20% of their business toward next-gen security, and now by adding identity as well, that adds to that percentage. So some of them actually have an identity practice that they can leverage as well. We know the vast majority of our strategic partners are within striking distance. Yes, they may need to stretch. Yes, they may need to do a little bit more work to get there. But look, this is why we gave the 18 months. This is why we enable our CBMs, our field team, to work with these partners early on to start having those plans.

And I think overall, the partners who are committed to us, who are not ad hoc, opportunistic – “Oh, this deal I’ll work with Palo only, I’m not fully invested in them” – I get it, those partners may not get there. But frankly, those partners in the first place, they were not driving that much business and that much impact for us to begin with. They were opportunistic, they were bringing some deals, which is totally fine, but we’re not going to necessarily limit our program evolution and requirements based on those.

Overall, I feel pretty confident that our strategic partners will be able to meet those requirements come the 18 months. And here’s what I’ll say – last time I did this when I was at ServiceNow and I evolved their partner program, it’s funny how things happen sometimes in the same way. I was there about 18 months before we launched the program. Somehow it worked out to be about 18 months. I don’t know why, it seems like that’s the magic number. And I recall at the time we gave about 18 months and the vast majority of partners ended up getting to where we expected them to go. Yeah, we had a few we had to work with and figure out a way how they can get there in a few more months, but overall it ended up moving that ecosystem in that direction.

Now I understand cybersecurity is different than a workflow optimization company, but at the same time, I’ve done these things when I was at Cisco. I’ve done them at ServiceNow and I feel like this is the right move for us at Palo Alto. And I’m encouraged by what I’m seeing early on. The feedback from our partners seems like “Okay, we like this because it’s going to allow our unique partners to stand out.” And if you have too many that are all special, then no one is special. You know how that goes.

So we believe 18 months is the right time and the early indication seems to support that.

Robert Dutt: It’s funny how, as they say, history rhymes with the 18-month cadence for you across new roles. Switching to the incentive side of things, you’ve eliminated the discount caps that used to lock partners out of earning a rebate on heavily discounted deals. That sounds like a pretty big one for partners. Can you give me a sense of the magnitude here? You’ve said that some partners could be earning two to four times what they were earning before. Is that the aspirational number, or is that broadly achievable?

Michael Khoury: That is the actual data. When I said that two to four times, it was actually based on actual data that we modeled based on last year’s performance. So as a matter of fact, when I’m looking at partners, we are more than halfway into our fiscal year ’26, which you know will end in July. So fiscal year ’27 will start August 1st.

When I look at our performance for FY26, which we launched the program only in February, so we’re talking about only the second half of the year where these things are making an impact – as a matter of fact, when it comes to the rebates, we changed it in the last two weeks of the second quarter. We didn’t want to finish the second quarter where partners may be holding back on some orders to wait for Q3 where they can earn more rebates. So we made a decision to say “Hey, we’re just going to do it in the last two weeks of the quarter so we don’t hurt our Q2 numbers.” And it turned out to be a good decision because our data was very strong in Q2. So that was great.

But it’s a great question. It’s not aspirational. It’s the actual data on past bookings. And what’s really exciting about it – when you look at our next-gen security, around SASE, Cortex, and obviously identity we’re going to address later – but when you look at SASE and Cortex, for us there were a lot of deals our partners were driving but they were not earning those incentives.

And here’s one interesting fact. As we started to make that shift and we started to talk about it, all of a sudden in our deal registration – which means mostly the business that our partners obviously source and bring to Palo Alto – our next-gen security deal registration percentages were not as high. And once we started to make that shift and we’re tracking this, you won’t believe it, all of a sudden we’re starting to see an increase in our deal registration and partner-sourced business for us.

So that tells me, even though with only one month or one month and a couple of weeks, because we did that change two weeks into the quarter, I’m starting to see the pipeline. I’m starting to see more booking toward that next-gen security. So it’s a good early indication. Obviously I need to wait a couple more quarters. I’m not going to claim victory only in six weeks that we’ve had this. But the early indication, Rob, seems to show that as we made the changes toward these incentives, especially with next-gen security – because in the past a lot of partners, because of the market and competitive dynamics and the way our list pricing model was set up, they were not able to earn incentives on next-gen security – but now they are. So that’s starting to show early indication of pipelines, early indication of deal reg percentages, and so on.

So I’m encouraged by where we’re going to finish the year, but I’m more encouraged for next year. Because it’s funny, every time we do these things, when you launch something new it takes about a couple of quarters for the ecosystem to kind of understand, fully adopt, embrace, and put it into an operational vehicle so they can execute on it. And then you start to see in that third and fourth quarter it starts to get much better, and by the fifth and sixth quarter, that’s when you start reaching a higher level.

So again, I don’t know why, but somehow things always end up working toward that 18-month kind of trajectory. Because you’re right, the ecosystem cannot pivot right away. They need time to adjust. But that’s what I’ve seen over the years dealing in this for a long time. That’s typically what it takes to get to a higher level. So I’m really excited about where we’re going to end up in ’26 and even more in fiscal year ’27.

Robert Dutt: A lot of the audience are mid-market MSPs and resellers, the 15, 20, 50-person shops. When you designed this program, how much were you thinking about that sort of long tail of smaller partners who aren’t at global SI scale? The platform approach – I understand it, it sounds good in theory – but building specializations across the different areas, across network, across cloud, across SOC, requires investment that might be a reach for a smaller partner. What’s the path for that small partner MSP?

Michael Khoury: That’s great. First of all, I said it earlier but I didn’t share the percentage with you. I will share it now. Our managed services route to market is growing over 60% year on year. So I can tell you that that’s where we’re seeing a lot of growth. Even traditional VARs, a lot of the traditional VARs are starting to build and deliver managed services. So the business has shifted from just resale, traditional VAR, to managed service.

Regarding what we’re offering to that smaller VAR – or that smaller managed service partner, I should say, but it also applies to even our resellers if they want to build a business and go-to-market motion around Palo Alto Networks – we just launched, actually, as part of this program redesign, the ability to have access for all of our partners with on-demand learning experience. Not just for pre-sales and technical sales, which we had always available as on-demand learning, but we just expanded it for post-sales. So now if you’re a smaller partner, you’re going to have access to on-demand learning experience across sales, technical pre-sales, architect roles which are kind of more pre- and a little bit post-sales, across engineer roles for delivery, and across analyst roles for support.

So now they have access to on-demand learning experience across all products, which we started with this quarter, and we’re adding more products within the next quarter as well. So that’s number one.

Number two, we now incorporate as part of our training for partners an AI roleplay that is also available to them. And the early feedback from partners – we had solution architects from partners come in and do this AI roleplay not prepared. And their feedback initially was “Michael, it kicked my butt, I wasn’t ready.” And now they feel like it gave them an indication of what they need to do better. The new AI roleplay is enabling our partners’ sellers and technical pre-sales to help them position the product. And it’s also enabling the post-sales engineers, architects, and analysts as well.

So we’re giving them access across all of that on the portfolio. In addition, once they have access to the on-demand learning experience, part of the ongoing certification model now includes a roleplay. But they also now have access to labs across the entire portfolio. That’s also available to them through that on-demand learning experience. And in addition to that, we just launched Demo Zone, which is also available through the Learning Center. So they can do demos across the product line, they can come in, get training for about an hour, hour and a half, and be able to do demos for customers, really without needing help from a sales engineer or solution consultant at Palo Alto Networks.

I touched on this early on when we started – that was one of the key changes we needed to make. Sure, our partners need to have access to the right training, to the right enablement, so they can be self-sufficient. So technically, if you have a smaller partner who’s embarking on their journey with Palo Alto, they’re going to have access to really a lot of content, training, and capability across all roles, available to them on demand. It’s going to allow them to invest and grow and drive that business growth like never before.

And obviously with MSSPs, we provide them with programmatic front-end discount that helps them win in that commercial segment, that mid-market that you touched on, without needing a lot of help from Palo Alto. So in a way, we’re giving them access to the training, the enablement, the tools, and also to the programmatic element from a front-end discount, and to the back-end rebate as well, to ensure they can grow and develop that go-to-market motion.

So I’m really excited – even though our managed services was growing at 60%, I’m really excited about where it’s going to go a year from now, because I don’t think we’ve touched its full potential. A lot of those managed services partners are going to be able to reap a lot of benefits across the board, across the entire portfolio.

Robert Dutt: The AI roleplay tool – that’s something that I thought was really interesting, really fun to see in there. It’s been interesting seeing AI start to find its way into partner programs. Sticking with the sort of idea of resources and smaller partners, are there any Canadian-specific resources or team support that smaller Canadian partners of Palo Alto should know about?

Michael Khoury: Look, in Canada we have a very strong managed service motion with partners. And when I look at just the ratio of percentage of Canadian partners and the investment, I see that our Canadian partners actually invest – just from a percentage of resources to booking and revenue – I see our Canadian partners invest more in technical pre-sales roles and training for individuals than in other markets.

So I’m very encouraged to see that in Canada, not just are we driving a strong managed service motion, but we also have more investment from a resources perspective. Because when I look at a partner, I don’t just look at how much booking you did with us, because to me booking is more of a lagging indicator. I look at the investments, and not just by the number of certifications they have – I look at the number of individuals. Because obviously you can have one individual sometimes accumulate multiple certifications. So I do look at the number of certifications by product, but we also look at the number of individuals that a partner has invested in.

And I’m encouraged to see that in Canada, particularly in our managed service motion and even in our resale motion, I see more and more partners investing in sales and technical and obviously post-sales as well. I found that was interesting data that I uncovered as I was comparing, for example, US partners to Canadian partners.

So that’s encouraging. That means our partners in Canada will be able to have, over time, as they leverage the new program, even bigger market share and better representation. Because the data is very clear – partners who invest more in their enablement and their certification, who really go on that journey, their revenue tends to be much higher than partners who don’t make that same commitment.

And that’s why we have something that we’re now making available – it’s called our Partner Capacity Dashboard, something brand new. We’re making it available to our Channel Business Managers first for this year. Next year we’ll make it available to partners so they can have clear visibility on all the individuals, the training, the demos, the AI roleplays, all the things that their people are doing. And we also look at their projection for the year’s business and give them guidance on whether they have enough individuals, enough people who are certified.

So it’s going to help them really with their business planning for the future. I’m excited about giving this first to our Channel Business Managers. We have a few things to work through, and then by beginning of ’27 we’re going to make it available to partners to help them on that journey. So that’s another one of those things that we’ve evolved and changed.

Robert Dutt: You touched on this a couple of times, let’s discuss it now. The CyberArk acquisition closed in February, $25 billion, added identity security into the fold. And that’s something that we’re hearing a lot more about across the industry and throughout the channel. What does CyberArk being in there mean for partners right now? Is there a NextWave path for identity? And how quickly do you think partners are going to be able to build their capability there, particularly with Palo Alto?

Michael Khoury: So this was my message probably a week before we closed the CyberArk deal. I went to a CyberArk event, their global sales kickoff, where we had about 200 or so partners. And one of my messages to those partners in the room, I said “Look, if your business is resale, managed service, or consulting implementation on identity only, that’s totally fine. That is a home for you at Palo Alto Networks.”

Now it turns out, when we looked at the data, the vast majority of our partners are joint partners, meaning they are both a CyberArk partner and a Palo Alto Networks partner. We had a very small number of partners who are CyberArk-only partners. And those partners, we were in the process of ensuring we onboard them in the next few months before the new fiscal year starts.

So the journey for those partners is, if you’re going to continue with identity, we’re going to give you all the support, all the things that I talked about earlier – from access to training, enablement, demos, AI roleplay, tools – all of that is going to be available for identity. All the incentives that I talked about, which today are not available in the CyberArk portfolio, we are going to be working on that for identity for the new year as well. So partners can be even more profitable when they do business on identity.

And both CyberArk and Palo Alto, we both embrace partner delivery and support services as well. Between us and them, we have over 90% of the delivery on CyberArk – and a similar thing on Palo Alto – done by partners. So it’s not just the managed services motion or the support motion, but even the delivery motion as well is done by partners.

So there will be a path if you just do identity – and again, those are a small percentage – there’ll be a path for those partners to be able to continue to invest in identity. And they’ll have plenty of time to adjust. And if they don’t ever want to go beyond identity, that’s fine.

But again, the majority of our partners are actually joint partners between the two companies. So there is a lot more synergy there. When you start looking at data, you start looking at which partners drive the TCVs and the bookings on Palo Alto, there is a lot of overlap. And we’re rationalizing the rest of our ecosystem as well.

But I’m excited about adding identity and being able to incentivize and give more support to those identity partners. And I’m glad to say, by having such a large joint overlap, I think that in itself will open up more business for them and more opportunities for us.

And frankly, for the Palo Alto partners who do not sell identity – because we have more of those, Palo Alto partners who do not sell identity – this is going to be a great opportunity for them to embrace identity, get the right training, get the right certification and specialization, and be able, if they want to expand beyond what Palo Alto offers, into the identity space. That’s the bigger area of opportunity. Because as I said, the joint customers – all of the CyberArk partners are actually Palo Alto partners – but we had more Palo Alto partners who are not CyberArk, who don’t sell and support identity. And that’s where I feel there is a big potential for growth in that area.

Robert Dutt: Do you have any kind of feel for how many of those partners that you describe, who are Palo Alto but not CyberArk, have made identity bets elsewhere?

Michael Khoury: That’s a great question. I don’t have that top of mind to share with you as a percentage. Identity tends to be an area where you need to invest deeper. Let me give you an example – a certified delivery engineer at CyberArk is a minimum six-to-nine-month type investment. So it’s not as easy for a partner to pick it up overnight and say “Yeah, I’m ready to go down that path” unless it is part of their go-to-market motion and they have a plan for it.

Now, the way we see the future, with more agentic AI and privileged access going to play a bigger role, we believe identity and the privileged access space is going to be an even more key component of that. So I’m going to see more and more partners – not just the joint partners, but more and more partners are going to start to embrace that.

But I don’t have the exact percentage top of mind of, hey, if you are Palo Alto only, have you invested with another company versus us. I think they’re going to find very quickly, with all the things we’ve changed in the new program and implementing those with identity and incentivizing more on identity, I think it’s going to be very difficult for them to turn away, even if they were investing with another vendor, not to come to Palo Alto Networks and invest with our identity solution. Especially as we integrate the products and there’s going to be a lot more capability from a platform perspective by having identity.

I think it’s going to be more and more difficult to say “Oh, I’m just going to keep working with another company on this one product only.” I think they will see the value, even if I don’t do all the great things I talked about in the program, which we are doing for identity. But from a product and a technology perspective, I think there is a lot of value there.

Robert Dutt: My last question – if we’re sitting here a year from now, what does success look like for this program? What’s the metric or the outcome that tells you this revamp worked?

Michael Khoury: Yeah. I mean, if I look at the key metrics that we’re looking for – and I think you heard me talk about them already – I’m going to look at how many more partners have trained individuals on Palo Alto Networks, how many more certifications across next-gen security, how much more booking is coming from that side of the house, what percentage more of deal reg is initiated by partners. I’m going to look across various elements to say, did we actually hit the mark?

And obviously the other piece is we’re investing in those partnerships as well. All these things that I talked about to make available for partners, it’s an investment on our part. So I need to have that direct correlation to all these key success metrics. And so far the early indication says we’re heading in the right direction.

There is one item we haven’t talked about and I want to mention this. Part of our incentive redesign, we also created a program called the Partner Development Fund. So partners will not just be able to earn rebates from us, but also part of the investment they earn will go into a Partner Development Fund that helps them invest in their future growth.

So when I look at that future growth and all the activities that partners can drive with us – whether it’s investment in training, investment in headcount, investment in migration services, competitive takeout, whatever the case may be – they’re going to have funds available to them to make that investment in future growth. So one metric I’m going to be looking at is all these partners – how fast they’re growing, where were they growing with Palo Alto Networks as a percentage of business with us, and how fast that is growing now a year later, as we launch this new program with basically adding fuel to that fire and having a flywheel effect. The better job you do, the more we reward you. And the more we reward you, you have more funds to help you reinvest more in that growth. That part is really going to be a key differentiator for us and for those partners.

In addition, frankly Rob, our platform strategy across these different products is going to give them a very real competitive advantage. So when you take all that holistically – from a technology perspective, from a program strategy, from a go-to-market motion – all of that combined with access to more training, more enablement, more funds, more support, I think the story is going to look a lot more positive across all these metrics.

So I’m looking forward to, by end of fiscal year ’27, which will be the 18-month mark, seeing how this is going to play out.

Robert Dutt: All right, I appreciate that, and certainly a lot going on with the NextWave redesign. I appreciate your walking us through some of your thinking around building the program and getting it out there. Michael, thank you.

Michael Khoury: Thank you, Rob. Thanks for having me and great to be here. Appreciate the time.

Robert Dutt: There you have it, Michael Khoury from Palo Alto Networks. I’d like to thank Michael for his time. He was generous with it, and more importantly, he was generous with specifics, which is not always the case when you get into a partner program conversation.

A few things that stuck out for me with this one. First, the listening tour approach. Michael came in, asked partners what was working, and built the revamp around those answers. That sounds obvious, but it’s rarer than it should be. The four pain points that he identified – partners over-relying on Palo Alto staff for basic tasks, managed services being treated like resale, training and enablement that wasn’t keeping up, and an incentive structure that was, in his words, “mostly on paper” – those are complaints I’ve heard from partners across vendors over the years. The question is whether the new program actually fixes them, and the early signals are encouraging. The two-to-four-times earnings improvement isn’t a projection – it’s based on actual past booking data, and they’re already seeing increased deal registration for next-generation security lines within weeks of launch.

Second, the diversification requirement. If you’re a firewall-heavy partner, the 30% non-firewall threshold for Diamond level is real, and the clock is ticking. But Michael made a reasonable case that most strategic partners are already within striking distance, and the CyberArk identity practice now counts toward that number, which opens up a path that didn’t exist six months ago.

And third, for the audience here in Canada specifically, Michael noted that Canadian partners invest more per resource in technical pre-sales and certifications than partners in other markets. That’s a competitive advantage worth knowing about and leaning into.

Thank you for listening. If you found this one useful, I’d appreciate it if you’d follow or subscribe. You can find the In The Channel podcast on Apple Podcasts, Spotify, YouTube, and most podcast directories. And if you have a moment to leave a rating or a review, that goes a long way to helping other channel pros find the show. Until next time, I’m Robert Dutt for ChannelBuzz.ca, and I’ll see you in the channel.