Extreme Networks: We're Growing and 'Ready for a Fight'

With its Zebra Technologies, Avaya and Brocade acquisitions behind it – and those integrations complete – Extreme Networks now is focused on driving growth through automation and transformation.

That’s according to Gordon Mackintosh, Extreme’s vice president of worldwide partner programs. Last October, the company unveiled a new unified partner program while executives asked partners to pursue more cross-sale and up-sale opportunities with the company and its expanded portfolio.

In April, Extreme rolled out a new in-house financing program for partners, customers and prospects that want to purchase the company’s offerings.

Extreme Networks’ Gordon Mackintosh

Extreme Capital Solutions includes Brocade’s capital-solutions team, which Extreme gained in its $55 million acquisition of Brocade’s data-center networking business. The program includes subscription, capital leasing and usage business models that provide flexibility for partners and customers.

In a Q&A with Channel Partners, Mackintosh gives an update on partner momentum and the role partners are playing in the company’s overall growth.

Channel Partners: On Jan. 1, Extreme partners began a new journey as part of the company’s unified partner program. What’s the status of that journey?

Gordon Mackintosh: It’s been going great. The new partner program has been extremely well received by our partners. In fact, many of them have been really surprised that we were able to integrate three partner programs into one and unify it together. And I believe that success came from the fact that we actually worked with partners to build the program, so the program was in many ways built by partners for partners, and we really integrated all of the best ingredients of the different programs from the acquisitions to create an industry-leading unified partner program.

CP: Among Extreme’s goals for fiscal year 2018, which ended June 30, was reaching $1.1 billion in year-over-year revenue growth. Is the company on track to reach that goal?

GM: We’re in a closed period at the moment so I can’t comment, unfortunately, on revenue. What I will say is that our partners are playing an extremely important role in our growth. If I look at our deal-registration business … we’re seeing about a 60 percent increase in deal registration overall. And the other big thing is, at the partner conference last fall we asked partners to bring us new customers, and we’ve seen that literally double over the course of this fiscal year. So we’re going to close this fiscal year on $30 million in closed business from new customers brought to us by partners through our deal-registration program.

CP: What’s attracting all of these new customers?

GM: We have the portfolio expansion through the acquisitions, so there’s more for the partners to talk about. We’ve also spent a lot of money enabling our partners so that they’re capable of selling a broader solution. And then also with the Extreme Demand Center, we’ve supported them with leads, and building leads and [a] pipeline of opportunity, focused particularly on the new customer space.

We classify a new customer as a customer who hasn’t bought anything in the last three years. You put all of the data together from the acquisitions, all the dormant customers, and then you put together focus with …

… the partner community around those customers — and we’re seeing some great traction.

CP: What kind of momentum has Extreme experienced since its acquisitions?

GM: The Extreme Capital Solutions program is gaining a lot of interest, and we’ve had extremely good feedback from our partners. It really allows them to win deals and opportunities that they wouldn’t have done in the past by potentially leveraging the zero-percent financing, moving the deal from a capex to an opex, or maybe some creative financing solutions around monthly payments, or payments per port or per access point. And that really plays into the world of IoT, where you’ve got thousands of devices or millions of devices connected to the network, and the way that the network is deployed is almost always in a managed-service-provider type of environment … and typically a lot of that leads into monthly billing per device, etc. So we’re seeing good traction, but it’s still early with those programs. These are really things that were built for the future and we’ll talk more about enhancements in that space at this year’s partner conference.

CP: Let’s talk about new and latest opportunities for partners. For example, Extreme last month announced Smart OmniEdge, an artificial intelligence (AI)-enabled network edge solution.

GM: The new Smart OmniEdge technology is very exciting for our partners. We’re just in the process of finalizing a master specialization for Smart OmniEdge, so in the future we’ll have just three master specializations to keep things simple. We’ll have the automated campus, the agile data center and then the Smart OmniEdge. We’re in the early stages of this offering, but we’re seeing a lot of interest from the partners. And with Smart OmniEdge, it’s about educating partners on the technology, making sure they have the right skill set, but also taking advantage of these changes in the marketplace where customers are looking for more of a cloud-based managed offering, a managed-service offering, and they’re looking for the network to take care of itself, to be intelligent and to be automated. And there’s great profitability for partners in all of that. So that’s one of the things I’m most excited about moving forward.

Also, early next month we’re launching Extreme Dojo for Partners, which is an internal sales and technical enablement platform that we’ve been using with our own salespeople. It’s themed around the karate dojo and it gives sales and technical the opportunity to expand their knowledge from a white belt all the way through to a black belt. It’s gamification, it’s an exciting and interactive way of learning. It will allow our partner sales and technical folks to (obtain) the same training and the same knowledge, whether that’s at a technology level or a vertical level.

CP: What sort of feedback have you been receiving from partners? Are there things they like, don’t like, about the unified partner program?

GM: I would say that now that we’re through the acquisitions, everyone’s really satisfied with the economics of the partner program. And with the dojo, we’re going to get more training; we’re going to be more focused on enablement and training. That’s one of the biggest things with partners; they’ve got a real hunger right now to consume …

… as much knowledge as possible. And then also automation;, they’re looking for some of our systems and tools to be more automated so that they can self-serve, they can quote, configure and price solutions. And also they’re looking for new revenue streams, and that’s where the Smart OmniEdge comes in. There’s an opportunity for them to get to the customers they’re not getting to today with that technology.

CP: What’s the second half of the calendar year looking like for Extreme and its partners?

GM: This fiscal year for us that’s drawing to a close was one of acquisition and integration. Looking forward it’s going to be about growth, and driving growth together with the partners on what is a very strong foundation. So we’ll be focusing more of our time, energy and resources on partners that are going to deliver us growth. And the theme for the partner conference, things we’re thinking about, is it’s going to be a year of automation and transformation to enable that growth. We believe we have all the right assets and we’ve got them all well positioned, and we’ve got a strong partner program, and we need to automate now and transform, and differentiate the customer experience — and then we need to grow.

CP: At last fall’s conference, much of the talk revolved around Extreme continuing to gain enterprise market share as Cisco and HPE were distracted. Has that happened?

GM: I point to our success with deal registration and new customers increasing from our partners. If they’re winning more new customers, they’re winning them at the expense of the competition. So partners are playing a critical role in all of this. We are still by far the most profitable networking vendor in the industry; we are the most focused on this enterprise networking space and now we’re positioned to move with more agility than ever before. When I talk to partners who are selling into the networking space, the key to it is profitability, and profitability isn’t just the partner program, it’s also the fact that we’re not overdistributed. We’ve done a great job through the acquisitions of consolidating our distribution partners and now focusing in on a subset of the channel, focusing our resources there because we don’t want to become Cisco and HPE, we don’t want to become overdistributed. And that’s how automation will deliver the the agility and the self-serve that the channel needs. And we’re just going to continue to focus on the enterprise space. Nothing’s changed, it’s just getting better and better for partners who are selling into the enterprise networking market. We’re going to continue our goal and drive to No. 2 in the market.

We’re going for growth, we’re ready for a fight and we want to be aggressive. We want to partner with the right partners. This is going to be a fantastic year ahead.