Cloud-based email security and management firm Mimecast recently announced it will be restructuring its bundles and increasing its price lists. Set to go into effect April 4, 2017, product packages will now include three bundles and three add-ons. Mimecast suggests these changes will make the process easier and more profitable for their partners. Most challenging for Managed Service Providers (MSPs) and SMBs is that the new minimum order per customer is $1,200 per year for those on-boarded after April 4. Having also eliminated the entry level filtering packages, the lowest bundle offered will now cost more than Mimecast UEM Express. Essentially, basic filtering prices will double.
For the MSPs, this will present a challenge to their business and profit models (particularly painful for those who just switched over from McAfee and MX Logic). Given that MSPs often sell to SMBs with under 50 users, the $1,200 annual fee is unfeasible.
The IT community has taken to platforms like Reddit to voice their distaste for the price increases and program changes.
“… I don’t mind paying for a good product but the $1200 [new annual minimum] is a huge sticking point for our smaller clients. We could sell email security at $2.50 [per user, per month] for a 20 user organization but would now need to sell that at $5 [per user, per month] just to break even!”
– FusionZ06 on Reddit,
In response to the furor, Mimecast’s freshly minted SVP Global Channel Sales, Eli Kalil, sent an email to partners, which was subsequently shared on Reddit by one of the recipients. Of interest is the alternative he offers: “As an MSP, if you have smaller customers who only care about isolated targeted threats or advanced archival, then the logical choice might be offering them Microsoft native 365, as it should support them sufficiently and allow you to continue to add value and price the service effectively for your SMB customers.”
This idea, that the native Microsoft threat protection is sufficient is controversial at best, a bad idea at worst. Kalil has since apologized in a separate blog post for how the announcement was handled. He defended the planned changes, citing McAfee’s removal of MX Logic as proof-of-concept. He said, “The economics of delivering entry-level email anti-spam and anti-virus to very small businesses are generally unattractive to SaaS providers.” At Vircom, we vehemently disagree!
He also appeared to directly contradict his earlier email statement: “We feel that especially for small customers who often don’t have any additional layers of protection, entry level email security is not a good solution on its own. So we want to encourage our partners to ensure their customers include more protection, deliver the coverage that they require and do so in a way that is cost effective.”
It is difficult enough to parse the meaning from the two statements, but it sounds like “you SMBs are too small and unimportant, so you need very basic weak protection … no wait, you actually need better protection, but of course that costs more”.
He then justified the exorbitant per user prices SMBs and MSPs will face with increased integrated Targeted Threat Protection. Ultimately, it appears as though Mimecast sees MSPs as a drag on growth and would rather focus on bigger ‘phish’. Publishers know working with SMBs can eat into profits as they require relatively more support than larger businesses — especially when managing IT and cybersecurity. This is why having a good relationship with MSPs can be valuable and productive.
However, to brush SMBs off as “smaller customers who only care about isolated targeted threats” is remiss of their needs. Mimecast will argue that Targeted Threat Protection (TTP) is different from Advanced Threat Protection (ATP), with small businesses not requiring the former as they are… well, too small.
In short, Mimecast is implying SMBs don’t need or deserve comprehensive cybersecurity. This is simply not true, there is no such thing as ‘security by obscurity’, being small and little known does not make you less of a target to hackers, who today dispose of automated resources that help them target all companies at a large scale. SMBs (and MSPs) represent huge segments of the email security market. While they might not have the scale of large business, SMBs deserve the best possible protection at a price that reflects the value they are receiving.
Mimecast has a good product offering and is a strong competitor in the industry. Fortunately for customers, there are other cloud-based email security systems like modusCloud that represent compelling alternatives focused on serving all their customers, MSPs, SMBs and large enterprises alike. If you would like to investigate options that are friendly to businesses and MSPs of all sizes, contact us to learn more about modusCloud today.