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CRN Exclusive: Fortinet Makes Managed Security More Accessible To Small Partners With New Tier, Pricing

Adding an entry-level tier to Fortinet's MSSP program intended to make it easier for product-centric VARs suffering from margin compression in their legacy business to get into managed security.

Fortinet has added metered, consumption-based licensing and an entry-level tier to its MSSP program to make it easier for product-centric VARs to establish managed security services.

The Sunnyvale, Calif.-based platform security vendor said adding a third – or Silver – tier to the existing two tiers of its MSSP program will make it possible for channel partners with just $150,000 of Fortinet-related revenue, two certified FortiGate network security professionals, and one certified FortiGate network security management and analysis work to take advantage of the program's tools and support.

Previously, the program had just two tiers – Platinum and Gold – with partners needing $500,000 of Fortinet-related sales, four certified network security professionals, and two certified network security management workers to obtain Gold. Adding the Silver Tier should allow Fortinet to bring on 200 to 300 more North American partners to accompany the 220 existing Platinum and Gold partners in the region.

[RELATED: Fortinet CEO: We Believe We're Leading The SD-WAN Space]

The additional tier is intended to make it easier for product-centric VARs suffering from margin compression in their legacy business to get into services, according to Stephan Tallent, Fortinet's senior director of managed security service providers. The average margin for managed security services is 50 points, Tallent said, as compared with just 14 points for classic resale activity.

"We're big enough to be substantial, but we're small enough to be flexible," Tallent told CRN exclusively.

Fortinet's MSSP operation has grown from a one-person operation to a 11-person team that's capable of supporting a broader market and audience. Roughly half the team is focuses on engineering issues such as multi-tenancy automation and gaining efficiencies in a multi-tenant environment, while the other half deals with business issues related to the financial challenges of creating a managed services practice.

The typical VAR moving into the Silver Tier of Fortinet's MSSP program would have 50 or fewer employees and between $15 million and $20 million of total annual revenue, Tallent said. Bigger resellers migrating into the MSSP program would have the ability to move directly into the Gold or Platinum tiers following a probationary period, according to Tallent.

Members of Fortinet's MSSPs program are expected to have at least half of their business oriented around operating expenditures, Tallent said, meaning that the channel partner owns the equipment, delivers it as a service to the client, and charges a monthly service fee that covers a multitude of security functions.

Silver partners have access to centers of excellence and content that allows them to understand the operational overhead associated with a managed services model as well as the different models for procuring Fortinet technology and converting it into a monthly service fee. The company is also looking for bring expert, consultative-type support to shorter partner's path to revenue maximization, he said.

Fortinet has tailored its Silver Tier to meet the needs of smaller partners by providing a multi-tenant version of FortiCloud to serve as the management console since it requires less labor and expertise. FortiManager is offered to the higher tiers and offers more bells and whistles such as PCI compliance reports, Tallent said, but can be more of a challenge to operate.

From a pricing standpoint, Fortinet is looking to reduce capital expenditures for channel partners by rolling out metered, consumption-based licensing that makes it possible for MSSPs to pay based on the volume of traffic that's being protected.

"With this model, the clock is only ticking when clients are using it," Tallent said.

Under the pay-as-your-grow model, MSSPs will receive points for licenses and usage which can then be applied to acquire more hardware, licenses, or entitlements, Tallent said. With this model, Tallent said partners will only end up using the money or points needed to get their managed security business off the ground rather than having to stock their shelves with technology they might not be able to sell.

Pay-as-you-grow is available on all of Fortinet's VM infrastructure today, Tallent said, with the company looking to roll it out to some other areas of the product portfolio in the second half of the year.

Fortinet has wonderful messaging around its Security Fabric, a strong firewall offering, and fantastic brand recognition that makes its products a top choice for many customers, according to a channel partner that didn't wish to be identified.

"The company has one of the most powerful products in the market," the partner said.

Although Fortinet's firewalls are robust, the partner said they haven't historically been MSP friendly in comparison to other products on the market given the time and expertise that's required for installation.

Streamlining the installation process by employing more point-and-click functionality would help drive adoption by lowering the installation costs that end up being passed along to customers, the partner said.

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