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Key trends shaping the cybersecurity channel in 2023

Key trends shaping the cybersecurity channel in 2023

Trends: The global economic landscape is shifting. Cybersecurity skill shortage, inflation, and supply chain concerns are key issues contributing to price hikes and increased business costs. In this challenging environment, end customers are evaluating their spending, and channel partners, especially those delivering managed services, have been planning to raise prices on their services.

As per the recent whitepaper by Canalys, cybersecurity is the one area where customers are less willing to cut spending, and it will remain at the top of the executive agenda. Canalys forecasts global growth for cybersecurity products in 2023 by 13%, with the highest demand in endpoint and network security, and vulnerability and security analytics.

Here are the key trends shaping the cybersecurity channel in 2023:

1. Channel partners will be vital to high growth in 2023

MSPs will drive the biggest growth opportunity for cybersecurity as customers struggle with increasing levels of complexity. 54% of channel partners expect growth in cybersecurity to be over 10% in 2023 and 51% of channel partners expect growth in managed services to be over 10% in 2023. Some key areas of growth include:

  • XDR (extended detection and response)
  • Managed on-premises infrastructure for mid-market and enterprise customers
  • Identity and access control services
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2. XDR can improve managed cybersecurity outcomes

As per Robin Ody, senior analyst, Canalys, “XDR is one of the hottest topics in cybersecurity. It is vital that vendors and partners work together to deliver on its true potential for customers.”

XDR combines data feeds from different technologies in a unified way, allowing for improved detection and response. It improves accuracy and accelerates detection by unifying threat data into a single interface and reducing the mean time to response (MTTR). Collaboration between vendor and partner is key to better managing XDR services.

3. M&A trends in the cyber channel

Mergers and acquisitions have been a hot topic in the channel for some time now. There is an increased interest among larger managed services companies and private equity firms to acquire large or small MSPs. MSPs are attractive to buyers due to their steady growth, recurring revenue, and ability to scale. Per Canalys, MSPs valuations have dipped slightly, but their attractiveness is still high. Venture capital and private equity funding is still active as MSPs attract further investment. 20% of today’s pure-play MSPs in EMEA and North America will be acquired or exit the market by 2025. In APAC and LATAM, the number of pure-play MSPs will grow 8% annually until 2025.

For more insights, read the complete Key trends shaping the cybersecurity channel in 2023 whitepaper here .

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