June's Top 20 Channel Stories: Cisco-Splunk, Layoffs, Merger Rumors, MSP 501

A common theme among many of our popular stories was the MSP 501, the world's largest and most comprehensive survey and ranking of managed service providers, unleashed in mid-June. One of the common themes we discoveredaround the 501 was how cloud cost management played a major part in the vast majority of many companies' 2023 bottom lines.

“Cloud cost management is becoming more of a topic that people are talking about, because they might have purchased that during the pandemic during haste,” said Marcial Velez, CEO of Xperteks Computer Consultancy. “Maybe now if they didn't configure it correctly, it's costing them a lot more than they anticipated. And they're now looking for cloud cost management, to see if they continue using that solution, or they may be thinking about bringing it back on prem.”

Learn more about the MSP 501 and cloud services.

Cisco and Splunk finally have begun rolling out the fruits of the former's acquisition of the latter, after Cisco spent $28 billion to buy the observability company.

One of the first big product reveals is the Unified Observability Experience, which will give joint customers integrations between Splunk Log Observer Connect and Cisco AppDynamics. This new feature was revealed on June 5, but won't be generally available until the third quarter.

The acquisition from Cisco helps Splunk seek "digital resilience," according to Splunk's CEO Gary Steele.

"What Splunk was missing is all of that depth and detail all the way down through the network to really understand what's happening across a broad customer environment," Steele said. "And what I'm particularly excited about is our ability to bring and enrich our environment with all of that network data [and] ThousandEyes data to give customers a fundamentally different perspective on what's really up and running and why. And I think no one better than Cisco can deliver all that together."

Learn more about Splunk and Cisco.

Lumen Technologies and its decision to fire more than 1,000 employees in April remains one of Channel Futures' leading stories this month. Lumen announced that it was laying off 7% of its employees in "select parts" of the company, and that all of the layoffs are voluntary.

"Lumen is transforming itself, and that often includes difficult changes. We are taking steps to reshape and right-size our business through automation and AI, aligning our resources to our new service delivery models and growth-oriented priorities," a Lumen spokesperson wrote in an email to Channel Futures.

Get the full scoop on Lumen's decision.

Speculation arose in mid-June that RMM company N-able might sell to Barracuda Networks. The purchase remains pending, it would be significant for the security company.

“It’s a valuable company with good products,” Canalys analyst Robin Ody said of N-able. “I can see why it would be an attractive acquisition. It would be a shame if it were to sell now, given it is one of the few RMM companies that has a broad enough portfolio and it had begun an interesting discussion around its 'Ecoverse' strategy. But perhaps its investors want money back and they are forcing the sale.”

(Canalys and Channel Futures are both part of Informa.)

Data and cloud company Snowflake hosted its Data Summit last month, where partners and customers gathered in San Francisco to learn about the company's work. This included a keynote on Partner Day featuring Tyler Prince, senior vice president of worldwide alliances and channels for Snowflake.

Snowflake is doubling down on generative AI, Prince emphasized, and is intent on building the "No. 1 ecosystem for AI apps and expertise."

"Every enterprise in the world is focusing on generative AI," he said. "It's a change across our industry, for every size of business in every country. I feel we are well-positioned because we are the leading and most trusted AI delivering on our promises for all of our customers. ... We have an ecosystem full of solution providers and experts to help our customers transform their business on the Snowflake platform."

Learn more about Snowflake's Partner Day remarks.

Keith Dennis is a longtime channel veteran, working in sales to help a number of companies and clients flourish in the space. That trend continues with him moving to join UJET as their senior VP of sales. Dennis talked with Channel Futures about his decision.

The channel veteran told Channel Futures that his decision to join UJET was inspired by two different reasons: "UJET’s unique and highly differentiated product suite and my relationships and experience in the channel community," the former RingCentral exec shared.

Read Dennis' interview and his thoughts on the channel.

Nutanix is striving to compete with VMware, trying to capitalize on the fallout from the Broadcom acquisition and encouraging customers to make the switch to its products. Executives claim that the process will take time to complete, but Channel Futures found several customers at Nutanix's Next conference who have already made the transition.

Gregg Lowe, CIO of Las Vegas-based Boyd Gaming, is one of those customers. He said that he was finalizing the migration of 5,100 virutal machines from VMware to Nutanix.

“We signed a three-year license with VMware. And within six months into that, we started to realize we were double paying for the virtualization component,” he said. “It didn't make sense. So we did a bake-off between the two companies and said, ‘May the best company win.’”

Read more about the migration campaign.

Fortinet acquired Lacework with the intent to integrate its AI-powered cloud security platform into Fortinet's Security Fabric.

Ken McCray, Fortinet’s vice president of channel sales, said the acquisition will strengthen Fortinet’s position in the high-growth CNAPP market and "enhance our existing cloud security offerings."

"We see this as a significant opportunity for our partners because it will enable them to engage more deeply in their customers’ digital innovation journey – from code to cloud," he said. "From Fortinet’s perspective, we will be even better positioned to deliver consistent security across on-premises and cloud environments. This only strengthens our partners’ role as trusted advisors to customers and helps them continue to deliver real solutions that help plan and implement security for both data center and cloud initiatives."

Learn more about Fortinet and its purchase.

Microsoft decided to enter the contact-as-a-service offering arena, which has several companies in that specific market concerned.

Microsoft unveiled Dynamics 365 Contact Center during Customer Contact Week. It will use Microsoft's OpenAI-based Copilot generative AI tool to pre-generate "co-pilots" into voice and text channels for contact center agents to use. The new offering just launched on July 1, but Microsoft already has deals with several companies.

"Applying learnings and insights from our own Copilot usage, coupled with multiyear investments in voice and digital channels, Dynamics 365 Contact Center infuses generative AI throughout the contact center workflow — spanning the channels of communication, self-service, intelligent routing, agent-assisted service and operations to help contact centers solve problems faster, empower agents and reduce costs," said Jeff Comstock, Microsoft corporate vice president of Dynamics 365 Customer Service.

Learn more about Microsoft and its CaaS initiatives.

Dell, like so many companies in the technology industry, is trying to show off its AI muscle. Like many other tech giants, Dell is partnering with AI pioneer Nvidia to develop products.

Dell CEO Michael Dell, on stage with Nvidia CEO Jensen Huang, said at the company's annual Dell Technologies World that the opportunity is “a generational opportunity for productivity, innovation and growth.” The opportunity coincides with the company's 40th anniversary.

Learn more about Dell's AI plans.

Kaseya's success in the first weeks of its Kaseya 365 subscription service launch was even better than company brass expected. More than 3,000 MSPs signed up for Kaseya 365 in the first six weeks.

“We have more MSPs on Kaseya 365 than most vendors in the space have MSPs, period,” said Kaseya CEO Fred Voccola. “I don’t say that in a haughty way. But this is a big, big, big thing that we’ve done and it has exceeded our expectations by huge amounts. We thought we’d have maybe 3,000 or 4,000 in a year.”

Learn more about Kaseya 365's subscription numbers and the industry impact.

Broadcom's decision to buy VMware has had a significant impact on the channel and on thousands of customers. This includes impacting the bottom line of those listed in the 2024 Channel Futures MSP 501.

“This is very disruptive,” Expedient SVP Allen Skipper said. “With disruption comes opportunity, and this acquisition has been the most disruptive IT event that we've seen in many, many years.”

Learn more about the Broadcom-VMWare deal and its long-term ramifications.

Layoffs at Oracle Cloud Infrastructure received a surge of interest on Channel Futures despite the fact the job losses occurred a year-and-a-half ago. Two hundred people lost their jobs at Oracle Cloud infrastructure in November 2022, one of several layoff announcements in the cloud space at the time. The cuts affected people throughout OCI and impacted a number of the company's operations.

Discover more about the layoffs.

HPE launched a new virtualization platform on June 18. The platform consists of an open-source kernel-based virtual machine (KVM) hypervisor with the company's cluster management for high availability and load balancing. HPE will manage the virtualization clusters through a cloud-based control plane, though it claims it will remain highly available even if disconnected from the cloud.

“We think our offering is very complementary,” said Hang Tan, COO for HPE hybrid cloud. “What we're trying to do is provide choice. What we're really trying to do is provide a radically simplified operational experience. When customers look at virtualization, they're no longer just thinking about it in isolation. They're really thinking about, ‘How do I gain access to future-proof?’ Because I'm not going to spend all this investment to migrate workloads just so I can land on another virtualization platform. I want to land on the platform that allows me to also be cloud-native.”

Read more about HPE's virtualization platform, announced at HPE Discover in Las Vegas.

The SolarWinds hack from 2021 impacted thousands of companies and their bottom lines. Now, a new report appears to imply that negligent cybersecurity practices by Microsoft may have left open a high-severity flaw, which a state-sponsored malicious Russian hacker exposed.

The revealing of that flaw didn't surprise some in the cybersecurity industry.

“When profit motives take precedence over security, it creates significant vulnerabilities that can be exploited by sophisticated actors like nation-states," Omri Weinberg, co-founder and chief revenue officer at DoControl, said. “The fallout from this could be substantial, impacting not only Microsoft’s reputation, but also the broader trust in cloud services and enterprise software providers. It’s a stark reminder for all organizations to rigorously evaluate the security measures of their technology partners, and insist on transparency and accountability in how they handle potential threats.”

Microsoft deflected in its response and promised to continue its efforts with security initiatives.

Tech service distributors play an integral role in the channel, particularly as clients and customers are weighing questions about AI, lead-generation strategy and private equity.

Five TSD execs gathered for a virtual panel in AireSpring's fourth annual Industry Roundtable on June 7 to discuss the subject, and had quite a few thoughts on the state of the industry. One of the most prominent topics discussed was the role that private equity plays in funding TSDs.

"If private equity weren't a part of this industry, all you would be asking about is, 'Why are the private investors not interested in our lifestyle business?'" said Avant president Drew Lydecker. "And the bottom line is, it's not a lifestyle business anymore. This is a multi-, multibillion-dollar business, and I think everybody should be cheering that. Because there are so few times in our lives in any industry where there's smart money entering into it and there is not a tremendous amount of success for everyone involved."

Learn more about the panel and TSD perspectives.

This edition of Channel People on the Move, Channel Futures' most popular recurring segment, featured new hires and promotions at HPE, Sophos, Avant, ConnectWise and more.

A wave of layoffs among cloud providers hit the industry in early June, featuring prominently in our cloud roundup. Microsoft Azure, Google Cloud, and Amazon Web Services had to make significant changes to their staffing, while others experienced heavy reorganization.

Microsoft, for example, laid off more than 1,000 people, as we reported on June 3rd.

"Organizational and workforce adjustments are a necessary and regular part of managing our business. We will continue to prioritize and invest in strategic growth areas for our future and in support of our customers and partners," Microsoft said.

Learn about Microsoft's and other layoffs.

Broadcom and Dell are finally working together again after months of tension. The two companies signed a new equipment manufacturer agreement.

But they're not the only ones trying to make a mark on the cloud computing space. Other VMware rivals tried to lure away clients, while indie cloud computing vendors tried to win MSPs over to their side.

Check out all the news in the June 11 cloud computing news roundup.

One of Channel Futures' crown jewels, the annual MSP 501, launched mid-month. You came flocking to see who landed where on the world's largest and most comprehensive ranking of managed service providers.

Of particular interest was the top 50, which featured some familiar names in the top 10, but also some newcomers.

You can also download the complete list of honorees.

One of Channel Futures' crown jewels, the annual MSP 501, launched mid-month. You came flocking to see who landed where on the world's largest and most comprehensive ranking of managed service providers.

Of particular interest was the top 50, which featured some familiar names in the top 10, but also some newcomers.

You can also download the complete list of honorees.