Integrator sign-up key to SMX revenue growth

Integrator sign-up key to SMX revenue growth

Managed security services provider SMX is beefing up its channel, saying up to 55 percent of its revenue could come from indirect sales in coming years.

The Auckland-based anti-spam and anti-virus company has signed top-tier integrators Axon, Unisys and Gen-i’s Bay of Plenty, Hawke’s Bay, Northland and Southland branches since late last year, while being close to finalising a partnership with Fronde.

Managing director Jesse Ball says the Axon, Unisys and Gen-i partnerships could result in additional revenues into the tens of thousands of dollars a year and could increase its user base by between 20 and 40 percent a year.

“Between 20 and 30,000 [dollars in revenue] per year, per reseller wouldn’t be hard to do,” says Ball.

“It depends on the type of customers they’re bringing in, companies like Gen-i and Axon are typically bringing the larger ones.”

Ball says he can’t give specifics about contractual arrangements with the integrators, but says some are on wholesale agreements and some retail.

Under a wholesale deal, partner revenue depends on how many users the company commits to signing up, and the partner bills directly for the service.

“Generally under wholesale they’re getting at least 30 percent off the list price as a start.”

Retail agreements provide earnings under two tiers – silver (which earns 15 percent revenue) and gold (25 percent).

SMX has about 40 resellers and 30,000 business users locally, with customers in Australia, the US, Europe and India. Current resellers include Connect New Zealand, CodeBlue and Acquire. Ball says it will work with any partner that has a track record in business and a customer base.

He says direct sales were initially important to build the business and SMX's credibility, but the company now wants to increase its partnerships.

“In coming years we’re looking at anything up to 45 to 55 percent of revenue to be indirect. Outside New Zealand it’s 100 percent through partners.”

SMX’s strategy is to select market leaders to take its service into overseas countries. The company already has a deal with Tata subsidiary CMC that covers India, the Middle East and Africa, and with security giant Symantec for the other areas not exclusive to CMC or other partners. The company wants to expand its Market Partner Plan to other resellers in Eastern Europe, parts of Asia and the US.

Axon has been working with SMX since late last year, but only signed up officially last month.

CEO Scott Green says SMX’s service will suit a number of its customers, particularly those with 100 to 500 seats.

“There are a number of organisations that have a need to control all the components of their security themselves, but with others we see a better fit for an outsourced or managed service like SMX.”

He says Axon selected SMX over other similar providers because they are New Zealand-based, giving the integrator some influence over product direction, and because each organisation partners with Symantec.

“SMX stacks up well against the best anti-spam and virus solutions available worldwide.”

Green says there is also a major shift towards the delivery of anti-spam and anti-virus technology as a service, rather than a software product that customers maintain on their own networks.

Gen-i Northland account manager Noel Jelsma says it adopted SMX’s service for smaller organisations with five to10 seats and before signing up didn’t offer a hosted service.

“We’re offering Mail Marshal which has done really well and we have a lot of happy customers on it, but it doesn’t scale well to those five, 10 or 15 user sites.”

SMX is privately owned and was launched in February 2006.

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