The market for MDR is expected to grow from $420 million in 2017 to over $1.6 billion in 2022.

Edward Gately, Senior News Editor

February 26, 2020

4 Min Read
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Year after year, cybersecurity is at the at the top of CEO concerns and is among the top CIO purchasing priorities.

Many are working to solve this by moving to a more modern infrastructure — think UCaaS, SD-WAN and 5G. But while adopting these technologies likely leads to a better user experience, the move also brings greater complexity behind the scenes, especially around security.

During his presentation, “Stress Less, Earn More with MDR Security Services,” on March 10, part of the security conference track sponsored by Nextiva at the Channel Partners Conference & Expo, Jack Danahy, Alert Logic‘s senior vice president and chief evangelist, will dive into the growing market for managed detection and response (MDR) security services.

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Alert Logic’s Jack Danahy

He’ll illustrate the low-stress opportunity it can bring for service providers to expand revenues and create stronger customer relationships by delivering peace of mind.

In a Q&A with Channel Futures, Danahy provides a sneak peek of the information he plans to share with attendees.

Channel Futures: How big is the opportunity for MDR services?

Jack Danahy: Whether you read the analysis from Gartner or watch the rising number of firms using the term MDR, it is clear that there is a new wave of services required in security, and I believe that wave is MDR. Gartner’s 2019 MDR Market guide describes a 500% increase in customers looking for MDR by 2024, and indicates a strong preference to MDR over any other managed security service during that same period. In dollars, the market for MDR is expected to grow from $420 million in 2017 to over $1.6 billion in 2022, a CAGR of 31.6%. That speaks to substantial growth in MDR services revenues.

There is an added opportunity for multifaceted MDR providers. Service providers who add a meaningful and repeating security practice can expect lower rates of churn and higher margin contribution from managed services due to the demand and perceived scarcity of the resources providing security services.

Join Danahy and 100+ industry-leading speakers, more than 6,400 partners and 300+ key vendors, distributors and master agents at the Channel Partners Conference & Expo, March 9-12. Register now!

CF: Why aren’t more partners taking advantage of this opportunity?

JD: We see strong interest within the partner community to understand more about security as they create their forward-looking strategy. Impeding the adoption among some partners are exactly the conditions that are driving MDR demand. Security isn’t simple, either to understand or manage, and security resources are very scarce. Partners experience both of these complications, and can feel that the integration of MDR will jeopardize their existing relationships or revenue if they fail to meet their existing standards. It is the responsibility of the MDR enablers to improve their capacity to describe, integrate, train and reward partners for their efforts in becoming MDR teams, and demonstration of this commitment will likely bring a higher and deeper level of interest in partnering for this technology and support.

CF: What are some things to keep in mind when incorporating an MDR offering?

JD: A strong MDR partner can provide a variety of levels of MDR integration. When incorporating this capability, I recommend a …

… phased approach, where some early and simple deals demonstrate the sales motion, and the execution of the deployment is mainly handled by the provider. Having seen these early examples, the partner can better predict their likely levels and their team’s capacity to support the customer. This cost in terms of time and effort by partner teams should be solidly considered in forming a relationship with an MDR vendor, as should the plan for reaching out with this valuable, but fairly new, capability.

CF: How can MDR provide better security for customers?

JD: The MDR value proposition should be a very simple one, even while it is complicated by some members of the vendor community. MDR minimizes the likelihood or impact of a successful attack, without requiring material investment in specialized skills, personnel or equipment. MDR provides better security by improving responsiveness, decreasing time to recovery and providing visibility into assets for proactive protection.

CF: What do you hope attendees can learn and make use of from your session?

JD: MDR services bring a fresh and deeper connection between partners and customers. In addition to the increased revenues, these services decrease the types of churn that happen when customers are simply shopping prices near and during contract negotiation. MDR services consider specific business conditions, and by doing so, increase the effectiveness of response and the value of the ongoing relationship to the firm. When this session is over, attendees should be confident in the benefits of MDR, and should feel very at ease in asking any follow-up questions here, later in the show, or later in the year.

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About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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