SMEs turning to the channel to fend off rising security threats

Smaller resellers that specialise in security are expecting the year ahead to be better than the experiences of the past 12 months.

Market watcher Context dug into the mood of the market at last month’s Black Hat Europe event, revealing several factors that would drive more activity on the SME channel front.

Hackers enjoy exploiting interest in major events, and this year will provide elections on both sides of the Atlantic and the Olympics for them to take advantage of, driving the need for greater security.

Then there is the impact of artificial intelligence (AI), which is experiencing greater adoption as customers look to roll out the technology to see if the promised benefits materialise. The introduction of more automation and digital business links will expand the risk surface.

Context also found that the old chestnut of education remained at the top of the channel agenda, with a continuing need to help educate users around best practices to avoid human-created weaknesses.

The analyst house used the French channel experience to sum up what was happening across Europe, with sales through distribution rising towards the end of last year.

“France has been very positive in cloud, endpoint and network security, with over 20% year-on-year (YoY) growth in all three segments,” said Context global director for research and business development Joe Turner. “This is down to small and medium resellers (SMRs). Where SMRs have a strong presence in security, that’s where we’ve seen an uplift in sales.”

The UK has also seen activity by SMRs, with customers here also looking to channel partners to help them bolster their network defences.

Across western Europe, security revenue declined by 0.3% year on year, but the narrative was already a more positive one towards the close of 2023.

The year ended strongly, with a significant uptick in week 50, with customer renewals and upgrades filtering into sales. Context is forecasting that the momentum will be carried over into this year given the reasons for users to continue investing.

The other factor that should lead to improving security sales is a return of economic confidence, with many in the industry anticipating a recovery to start kicking in from the second quarter.

Dominic Trott, director of strategy and alliances at Orange Cyberdefense, said a period of increased stability would provide customers with more confidence when making pending decisions.

“This business confidence will allow many of the security investments that were paused or cancelled during 2023 to come back onto the table, and will catalyse the ramp-up of cyber activity needed to meet the demand that was suppressed over the past year,” he said.

“Rather than focusing on getting the basics right and cutting costs, this will allow businesses to adopt the new techniques needed to deal with the pressures that have recently reared their ugly heads, such as AI-based attacks,” added Trott. “This recovery in confidence will allow businesses to adopt a more expansionary approach to security, rather than just doing what they can to get by.”

His message echoed responses of those at Black Hat, urging security players to move into this year with a positive attitude.

“[This year] will be more about proactively identifying threats, and gaps through which they can enter, before they can take hold. Channel partners should capitalise on this positive mood while they can to rebuild after a slower period in 2023,” he said.