Palo Alto Networks Revamps Partner Program, Brings MSP Program to Fore

Palo Alto Networks on Monday announced a major revamp of its NextWave partner program, the first in five years, to better align with customer and partner needs. The vendor also is reinforcing its messaging around its two-year-old dedicated MSP program, which is part of NextWave.

The channel-centric cybersecurity vendor is focusing the NextWave program updates around three key areas: profitability initiatives, partner-led services opportunities, and systems and processes.

Palo Alto Networks’ Karl Soderlund

“When we initially rolled out the NextWave Partner Program, we were a single product company going after a single market with a sole goal of growing as fast as we can,” Karl Soderlund, senior vice president, worldwide channels at Palo Alto Networks, told Channel Futures. “Now that we’re getting more elegant in our solutions to meet our customer needs, our model needs to change with us.”

The big driver of the NextWave program changes is cloud adoption, and the way customers buy and consume technology, the risks the face and they protection they need, which includes services such as integration, customization and security optimization.

On the services front, the NextWave MSP program provides a clear path capitalizing on the growth in that market space.

“This is about how we support those partners and how we resource those partners so they can be successful. There’s a market opportunity for us, so we’re putting more resources and focus in this area,” said Soderlund.

Taking a more in-depth look at the three pillars of change in the NextWave partner program:

Profitability Initiatives: Partners will notice new options to grow their business including new tier levels, a streamlined discount structure and new incentives.

The NextWave program is going from four tier levels – silver, gold, platinum and diamond – to three — innovator, platinum and diamond. Discounts will be based on volume and value, based around sales and technical competency, and services capabilities.

For top-tier partners, Palo Alto Networks is introducing a rebate structure based on certain parameters. Generally speaking, as partners move up the tier structure, they get more dedicated resources, have more access to the vendor, and will see an increased discount model.

“With that comes responsibility such as making sure that they have the capabilities around sales and technical to make sure they can support the customer base,” said Soderlund. “The last thing that we want to do is put technology into a system that’s not deployed correctly — something we see a lot in the industry among our competitors.”

Service Opportunities: This is a pivot for Palo Alto Networks and one it wants its partners to make, offering managed services and a complete solution to customers. Whether it’s software or hardware, the service opportunity is to make sure that customer solutions are delivered correctly, are aligned with the company’s strategy, installed and are supported throughout the customer life cycle.

“We’re saying that the pivot to the life-cycle opportunity is there. We know that there is an IT shortfall right now from a headcount standpoint throughout the industry, and most customers don’t have a full staff,” said Soderlund.

This is where partners can step in and be the glue to address customer needs. Services that partners can offer customers include …

… assessments, deployment and managed services. It’s also where Palo Alto Networks is stepping in with assets, such as resources and reference architectures, to help MSPs get skilled in meeting the needs of our customers, Soderlund said. The service opportunity for partners is big — 4x-5x margins.

Systems and Processes: This is about automated systems and processes that make it easier for partners to do business with the vendor. Partners can expect to see reduced complexities around pricing and support.

The vendor has about 5,000 partners, globally, and sees an opportunity to more with current partners and expand the relationship rather than increase the number of partners. The number of MSPs that Palo Alto Networks works with today is small, but the appetite for partners to make investment is healthy, Soderlund said.

“It’s an area where we were understaffed in the past but we’re now putting the resources and focus there [the services space].”

The latest partner-program update comes on the heels of significant C-level change at the vendor as well as acquisitions, all taking place in 2018.