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AirWatch held it's 4th 'Connect' end-user and partner event earlier this week in Atlanta. The long roster of mobile-first vendors in attendence was impressive and made this conference feel more like a mini CTIA event. The company attracted important executives from vendors such as IBM, Salesforce, and Samsung; and offered its customers access to three days of roundtables, keynotes and panel discussions on the hottest topics in enterprise mobility. AirWatch also offered customers a certification workshop and provided partners with training sessions.
As expected, AirWatch revealed several new enhancements to its EMM solution portfolio. Most notable was Workspace, the company's containerization solution. AirWatch (and its competitors) have seen upstarts offer powerful solutions for containerization and application management and recognized that it needed to complement its EMM suite with a hybrid approach in order to maximize the market opportunity with customers and prospects. The new Workspace app will serve as an app catalog; other apps include a secure browser, file synch/share, and email clients (these are AirWatch and not partner/white label apps). Other apps can be integrated via the company's MAM SDK, its app wrapping tool, or through partner ISVs.
The company also announced a marketplace offering customers and partners easy access to complementary technologies. The solution range of the participating technology partners is broad, including handset OEMs, and a diverse range of vendors that offer application development, certificate authorities, enterprise-grade applications, retail solutions, network and NAC solutions, telecom expense management, VPN and web security. Most of the marketplace partners had booths at the conference.
Customer Implications: AirWatch's solution range is evolving with the market, and the company has demonstrated that it can service large fortune 1,000 deployment environments. I had the opportunity to speak to several of the company's largest customers who were pleased with the support they received, and (more importantly) specifically mentioned that their feedback has been regularly acted on as they've expanded their deployments. AirWatch is very focused on sales execution and executive leadership seems intent on aggressive growth. VDC projects AirWatch's success will come as a result of the company’s ability to balance pressure to succeed with customers’ self-paced buying needs.
Channel Implications: AirWatch's attention to its channel programs support its growth ambitions. Currently, the company realizes ~40% of its software revenues via its partner ecosystem ― I see partners and managed service trends moving this number higher going forward. AirWatch definitely has attracted the most visible vendors in the mobile ecosystem as partners, and is demonstrating it knows how to build a successful channel program. The company will continue to expand outside of North America for growth, and sees an opportunity to work more closely with carriers for a "prosumer" version of its software ― this has the potential to bring significant revenue in my view. This is a tactic I've expected to see from other competing EMM vendors, and one that will likely be emulated (BoxTone's nascent partnership with NTT is the best example thus far).
Competitor Implications: Based on my conversations with leadership at the Connect event, it is apparent to me that a big advantage AirWatch has over its competitors is its ability to invest in R&D, attract top talent and invest in marketing ― AirWatch makes it clear that it has the means (it scored the largest funding round of any mobile-first ISVs this past February when Insight Venture Partners led a $200 funding round) and events such as this week's Connect event prove it. Like it or not, in a fast-growing and crowded market, visibility is important ― the company is already planning its next Connect event (scheduled for October in London). AirWatch's chairman (Alan Dabbiere) is keynoting CTIA's upcoming MobileCON event in October and the company's events team is already busy planning for RSA and MWC (Q1 '14). AirWatch's past experience managing a rapidly growing headcount is also proving to be an important differentiator. Many of the company's senior leaders are from Manhattan Associates (Dabbiere cofounded Manhattan and self-funded AirWatch in its early days).
With parity increasing in the EMM market, longevity will be predicated on the ability to innovate and maintain visibility in the market as large and established vendors such as Citrix, IBM and SAP continue to sharpen their focus on enterprise mobility. Our soon to be released global EMM market forecast shows a 24.6% CAGR from 2012 to 2017 for the ever-broadening solution range that is EMM. Almost every large deal is a dog fight, and pricing pressure will ultimately force market consolidation.