Q&A: McAfee's Channel Chief Discusses Mid-Market Expansion


We're possibly coming upon a challenging economic climate. What does McAfee's growth look like in 2008? How would you break down spending first half versus the second half?

I think everything I've seen is more of an '08 projection. I don't know that I would project anything different in the first half versus the second half.

Fortunately what we've seen is that security appears to be one of the less discretionary spending areas. And that all the data I've seen suggests that security expenditure is growing two to three times non security expenditure. There's increasing pressure on being secure. The bad guys are continuing to evolve their techniques, developing more efficient methods of targeting. They're developing more comprehensive attacks, and the cost of those attacks are becoming higher and higher, thus, in regards to the counter measures that organizations are interested in and want to deploy, they're willing to spend more to protect themselves from the risks that exist out there today.

Do you feel that in a recessionary time security spending and malware will continue to grow as people have less resources?

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I don't know if I have any insight as to whether there's a relationship between challenged economic times and malware's growth or not. There certainly isn't any indication of it slowing down. The amount of malware that McAfee received and developed solutions for in '07 was the about the amount of the previous seven years combined. The slope of the growth curve is just a mess. I don't see that slowing down. All indications are that growth rates are accelerating at exponential logarithmic type rates.

How much of your business is in the mid-market? What programs and incentives have you put in place to expand the mid-market segment?

We've really expanded our midmarket sales substantially this year to get better coverage and to engage a broader set of partners in '08. The midmarket already takes on a substantial part of our business. We do anticipate growing it substantially. We already have made a pretty big investment on the sales team, as well as more and more focused programs.

We also have a variety of specific incentives for our partners, in terms of promotions, programs, rebates, deal registration, MDF-based specific events that we're funding. We've also made a pretty substantial investment in our dedicated mid-market sales force, which is obviously designed to engage with our partners. We're trying to help bring business to them, as well as give them a resource to engage on the sales and execution side when they find opportunities.

We're at the beginning of the managed services growth curve. What are a few key points in your managed services strategy?

We anticipate that the adoption and integration of managed services will continue to grow. We currently have a managed service solution called ToPS, or total protection service, which is designed to be a comprehensive endpoint and e-mail security solution and provides a partner the ability to deliver it as a managed service. It's a very comprehensive solution, touching on antivirus, antispyware and spam in one integrated console deliverable by a solution provider in a managed service type environment. It's something that we are investing in pretty significantly in order to help solutions providers get it integrated in their broader managed service solutions that they're offering to customers. It's definitely one of the strategies to grow the midmarket.

What other kinds of new services is McAfee adding to its portfolio?

We have two types of services that we offer. One is Foundstone, our vulnerability management solution, which is in very high demand right now. It tends to be a little more third party, independent assessment of a security posture. Sometimes it could be security posture of the organization. It could be the security posture of a specific application.

And then we continue to work on developing solutions with our partners for the delivery and implementation of our technologies. We're trying to develop and educate our partners on how to best deploy our solutions, attaching services to the sale of our products.

What are you doing to increase sales and opportunities in the virtualization market?

We've announced some partnerships with VMWare. We're developing technologies that we think will help clients understand how to protect the virtualization environment. We've also announced some capabilities to help customers on the services side, to understand and how best to assess and protect the virtualized environment.

Are you currently in partner recruitment mode? And how many VARs do you hope to add on and in which areas?

We're always in partner recruitment mode. That's always a yes. We're looking to add partners who can help McAfee in obtaining its goals of accelerating growth. It's about finding partners that want to make a commitment to security. Wanting to make a commitment to investing in McAfee. I'm interested in working with partners if they have identified security as an area of focus, or a practice they specifically want to integrate. Those partners that who understand their business, understanding how we can work together to educate them and what McAfee has to offer. We certainly think that McAfee has a lot to offer, given the nature of the security marketplace.

What is the biggest channel problem you face in 2008?

Continuing to find ways to develop loyalty in our partners. Improving communication and making sure they understand the benefits we think we can offer to them.

Also helping partners to understand the business problems our product solve. It's ultimately about assessing a customer's security maturity level. We talk about helping customers reach an optimized state of maturity model in security. It's about helping partners understand how to assess who a customer is and understand how McAfee's solutions can help evolve that, maybe from being very reactive from a security model to one that's optimized, meaning they're in a very proactive model, where they've optimized use of security in their environment.

Has partner loyalty been a problem, or partner attrition been a problem?

No, but we always try to do better. If we're a 97 out of a 100 I want to make it a 98. If we're 50 I want to make it 51. It's always about earning their loyalty. It's about executing in a fashion where we earn their loyalty. A way to do that is to develop loyalty through trusted relationships and by bringing top quality products to the table that they can use. And by bringing a model in which they can make money. The list of things we have to execute on is long. And everyday we're trying to make our programs and our interactions with our partners better.