Ironport slams partner margin erosion claim

Jamie Andrews, Ironport

Content security vendor Ironport’s UK channel chief has hit back at rivals’ claims that its acquisition by networking titan Cisco has eroded reseller margins.

Last month, Borderware claimed it was on the lookout for Ironport VARs that had been unsettled by the Cisco buyout and had concerns about margin retention.

In September, Proofpoint signed a distribution deal with DNS Arrow and the distributor claimed it was seeing interest from disenchanted Ironport resellers.

Ironport’s UK partner manager Jamie Andrews told CRN that the acquisition had not affected margins, which he claimed to be between 20 and 25 per cent.

“Some partners make more than that,” he added. “There are a lot of wrap-around services and it is a strong revenue stream.”

Andrews also expressed his pleasure at the mix of traditional security VARs and Cisco resellers that makes up Ironport’s UK channel. “Traditional Ironport partners are picking up Cisco security products and the business we are doing through Cisco partners is also increasing,” he said. “There is a lot of cross-pollination.”

The vendor recently announced a strategic partnership with Dimension Data, one of Cisco’s biggest partners. The arrangement will focus on the large enterprise market and Andrews claimed he would be actively pursuing similar partnerships over the course of 2009.

Ironport reverted to a two-tier channel model this summer after signing Cisco-specialised Comstor to distribute its mid-market portfolio. The move signalled a strategic U-turn as the vendor dropped former distributors Sphinx and DNS Arrow shortly after being acquired by Cisco in 2007.

Andrews claimed the Comstor agreement had been a boon for Ironport’s UK channel.

“We needed to scale our operation and Comstor has given us greater reach into the market,” he said.

“It is allowing us to equip partners with skills and it is taking the recruitment efforts away from us by developing its own partners. The deal has had a very positive impact on our business.”

Scott Nursten, managing director of reseller s2s, claimed any erosion of margins had been imperceptible. “It is still a high-margin product,” he said.

He added that Ironport had been more communicative and approachable since the Cisco deal. “We were trying to engage Ironport before the acquisition,” he said.

“We were getting some traction, but it was not particularly responsive considering our security credentials. Now, we are seeing a lot of engagement; we have been invited to sales briefings and Ironport has sent sales staff to our meetings.”