The Enterprise Customer Segmentation Matrix

R. Pritchard

Summary Bullets:

• Since customer databases are available for mass business markets alongside providers’ existing major enterprise knowledge, service providers have traditionally segmented target markets by number of employees.

• Service providers are realizing they need to be more sophisticated and are trying to identify factors like digital maturity and proportion of knowledge workers.

More often than not, enterprise telecoms service providers segment the market in terms of employee numbers. Typically, they divide the market into SOHO/micro (0-5 employees: owner-managers don’t count as employees), SME/SMB (from 6-250 employees), and corporate/enterprise (250+ employees). Of course, these definitions vary from one service provider to the next, and often, specialist markets such as the MNC segment and public sector are addressed outside of the employee count model. The main drivers behind this are: (1) ‘this is how we’ve always done it,’ (2) ‘we can get databases of the target market by employee numbers,’ (3) and ‘any other approach is too difficult.’

Cybersecurity: Corporate Boards Take a Reactive Approach to Security

Amy Larsen DeCarlo – Principal Analyst, Security and Data Center Services

Summary Bullets:

• Though more than 76% of the surveyed corporate directors say their boards had at least one cybersecurity expert member, only one-third highly regarded their board of directors’ ability to navigate a security disaster.

• Leadership is not as proactive as it should be in getting ahead of incidents. Fewer than half of the board of directors who participated in the study had conducted cybersecurity tabletop exercises in the last 12 months.

The Wall Street Journal and the National Association of Corporate Directors surveyed 472 directors across all industries about their current cyber risk management postures and their respective levels of preparedness. The survey comes in advance of new US Securities and Exchange Commission (SEC) requirements that public companies release uniform reports on cybersecurity risk management, governance, incident reports, and cybersecurity expertise within their board of directors. The survey results paint a mixed picture that reveals a fairly high level of expertise but a largely reactive approach to security.

Cybersecurity Providers Must Approach 2023 with Product Simplicity and Consolidation in Mind

R. Muru

Summary Bullets:

• Vendors with wider portfolio and high growth product suites should focus on enterprise portfolio consolidation, with strong supporting business case.

• Vendors must factor in their revenue projections longer sales cycles and project delays on more complex cybersecurity deals in 2023.

Enterprise Trends:
As 2023 progresses, enterprises continue to face tough economic conditions. This year has already witnessed mass layoffs in technology and other sectors as organizations look to cut costs and streamline operations ahead of what is expected to be major reductions in consumer and corporate spending. IT budgets are expected to suffer as planned projects get shelved and executives reassess priorities.

Threat Preparedness: Not Ready for Prime Time

Amy Larsen DeCarlo – Principal Analyst, Security and Data Center Services

Summary Bullets:

• IT security preparedness may not be where it should be, but organizations are keenly aware of the threat. Some 82% of those surveyed in Cisco Cybersecurity Readiness Index said cybersecurity incidents are likely to disrupt their businesses over the next 12 to 24 months.

• Nearly 60% had been hit by a security breach in the last 12 months.

Enterprise cybersecurity awareness is at an all-time high as challenges associated with protecting IT resources and organizations across most industries building out end user security training. However, even with increasing education, a surprisingly high percentage of organizations are still underprepared to mount a strong defense against cyber threats. In Cisco’s first ever Cybersecurity Readiness Index, based on metrics across five pillars of IT security (identity, devices, network, application workloads, and data) and the implementation stage of 19 security solutions with those, only 15% of the 6,700 were met the requirements to be considered as “mature” in their cyber readiness. Thirty percent were rated “progressive” in their preparedness. Forty-seven percent were categorized as formative in their security implementations. And eight percent are very early in their security journeys, with a beginner ranking.

A Sino-Centric Approach by Gulf Nations and Telcos Should be an Alarm Bell for Western Tech

I. Patel

Summary Bullets:

• For China, brokering political stability in the Middle East means investment opportunities. It is working at both in tandem as an overture to its long-term strategic interests in the region.

• Policy and government diktat will not compensate for the fragmented approach by Western governments and tech companies when challenging the likes of Huawei in eastern markets.

After a seven-year stand-off that involved the Saudi and Iranian Embassies gathering dust in each other’s countries, Riyadh (Saudi Arabia) announced a rapprochement with Tehran (Iran) under the auspices of Beijing (China) on March 10, 2023. This was a surprise announcement made by representatives from the two countries attending a summit in China with analysts across all sectors pouring over what it means. Technology is one sector that is worthy of analysis comment to determine the wider implications for the international technology market.

UK SOHO Market Heats Up

R. Pritchard

Summary Bullets:

• Infrastructure-focused Giganet has launched a wholesale connectivity offering targeting the SOHO market for its reseller, managed service provider, and ISP partners.

• This re-emphasizes both the importance of the SOHO and SME markets as a key target as well as of the fragmentation of the supply/value chain.

Small and medium-sized enterprises (SMEs) and small office/home office (SOHO) businesses are becoming the telecoms target markets of preference across many countries at the moment. Given the background of deglobalization and trade wars, combined with many individuals choosing to pursue their own path or work on side businesses as a result of the pandemic as well as associated experience of working from home for white-collar workers (or laid-off blue-collar workers), smaller business is where much of global growth is being delivered, presenting an opportunity for many companies across all verticals, including the telecoms sector.

2023 Update on Cybersecurity Investment Trends and Considerations for Investors

R. Muru

Summary Bullets:

• Mergers and acquisitions (M&A) in cybersecurity continues to cause uncertainty in the investment community, but latest Q4 2022 projections show investments have picked up.

• Success for investors will entail investing in the right cybersecurity technology segments and ensuring investors back companies that are visionaries and have strong customer alignment.

Cybersecurity Revenues Remain High, but Investment Reservations Exist
GlobalData’s deals database highlights that in value, cybersecurity deal activity decreased previously by 98% in Q3 2022 compared to the Q3 2021 total of $7.7 billion. Similarly, deal volume also remained flat in Q3 2022, compared to Q3 2021, and was even lower by 33% in the same quarter in 2021. These trends indicate that although revenues among cybersecurity companies remain positive, there are still investment reservations in cybersecurity due to the unsettling economic climate and a possibility that cybersecurity stocks could follow in a similar fashion to tech stocks.

SASE or Zero Trust: Which Means More to Enterprises?

G. Barton Research Director

Summary Bullets:

• Enterprises like the idea of SASE, but zero trust is often more relevant to their business needs.

• Many enterprises feel they are not ready to implement either framework.

Secure access service edge (SASE) and zero trust network architecture (zero trust or ZTNA) are two of the go-to technology trends in the networking and security space at the moment. They grab attention because the idea of bringing network and security policies closer together is appealing to enterprises and often forms part of their IT strategy. The catch is that network and security convergence is often part of enterprises’ longer-term strategy (i.e., not before 2025), and it is often a vague aspiration rather than a definite plan.

Cyber Resilience: Strategies for Operational Continuity in a Troubling Threat Environment

Amy Larsen DeCarlo – Principal Analyst, Security and Data Center Services

Summary Bullets:

• Security resilience, defined as the ability to protect the integrity of every aspect of the business against threats and unexpected conditions, is a top priority for 96% of the 4,751 enterprise organizations surveyed in recent Cisco-sponsored research.

• Of the enterprises queried, 41% report that there had been a major security incident or loss within the last two years.

In a time where enterprise risk is omnipresent, IT professionals operate in a heightened state of alert. Organizations are cognizant of the fact that they are not only being targeted by cybercriminals, but that an intrusion is more likely than not to occur. With this in mind, Cisco conducted its third annual Security Outcomes research to get a sense of what is working for organizations as they strategize to defend their enterprises against a relentless threat environment. The high-level takeaway is that IT departments are making powering through security incidents (not just recovering from them) a top priority, with 96% of the 4,700 surveyed organizations calling cyber resilience a crucial concern for their business.

SMBs’ Cloud Security Struggles Exposed

Amy Larsen DeCarlo – Principal Analyst, Security and Data Center Services

Summary Bullets:

• Of the 4,984 IT professionals queried in a recent Sophos cloud security survey, 56% report a surge in attack volume and 53% say the negative effect of security incidents has been more severe in 2022 than 2021.

• Nearly two-thirds admit limited vantage point into their cloud assets and configurations was cited as a major contributor to their security woes.

The migration to the cloud has been especially challenging for small and mid-sized businesses that often lack the internal expertise necessary to make the transition successfully. Cloud security is one of the most vexing issues, with SMBs too often lacking the resources to consistently monitor what are often complex cloud environments. In a recent Sophos survey of 4,984 IT staffers in 31 countries, the security vendor has found a sharp increase in the volume, complexity, and negative impact of attacks in the last year. An alarming 67% report that their organizations have been subject to a ransomware demand.