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Security vendor keeps its deal registration program a secret

Kaspersky's new deal registration program offers rich margins, but their channel chief won't disclose how rich

Christopher Doggett, the vice-president of North American channel sales for security vendor Kaspersky Lab, has a secret. And he’s only willing to tell solution providers.

That secret is the amount of margin available for solution providers under Kaspersky’s newly announced deal registration program.

(RELATED STORY: Managed security services comes to the channel with Kaspersky)

Kaspersky’s new deal registration program applies to licensing deals of 50 nodes and higher and offers two rewards tiers: one for partners who are strategically engaged with Kaspersky’s sales organization on an ongoing basis, and another for those who sell only occasionally. The additional rewards and protection also extend to license renewals, offering the partner of record additional rewards on each renewal transaction which they proactively pursue.

The margin potential under this new program is in the double digits and that’s as far as Dogget would go on that subject.

CDN did ask Doggett about potential margins under this new program, but Dogget refused to talk specifics. And he has a very good explanation as to why he is keeping this a secret. “If I reveal the margin it could put the channel partners in a bad position.”

For example, if the security vendor offered 25 per cent margins and made it public, customers could then demand solution providers provide 20 to 22 points back to them, leaving the partner with razor thin margins.

Doggett did say he is aware of McAfee’s 25 per cent margin offer inside its deal registration program and added that Kaspersky’s is “substantially better.”

He added the reason for developing this type of deal registration program is based for the most part on the current margin erosion taking place in the channel. The channel team at Kaspersky made significant changes to its discount structure to help the security vendor standout from a profitability standpoint.

Another aspect of the new deal registration program is pricing control. Doggett said that Kaspersky aims this program at partners in SMB cities and a natural concern for them is if the vendor signs too many channel partners. “Our program is clearly designed for that not to happen,” he said.

Doggett told CDN he recognizes that solution providers’ business models are heavily based on services. He said that Kaspersky products are easy to install and manage for all infrastructures and operating systems. With that he sees solution providers reaching a five to one dollar ratio on services to product because Kaspersky products are not complex.

In the Canadian market, Doggett is working to build on a strong base of channel partners, he said. “We do have some work to do. There are a number of notable firms that we have not engaged with in Canada at all,” he said.

Doggett is looking to bring more channel resources to the Canadian team. “This is one of my focal points because there is a lot of upside in Canada,” Doggett said.