IT Spending & Cyber Security
Technology
As always, SPR will be tracking the trajectory of IT spending, changing priorities and competitive dynamics for the segments and vendors they follow. Key questions / themes for 2023 include: IT Spending: 1) Which vendors are seeing more than anticipated pressure from reduction in seats and end user efforts to contain costs? 2) Vendors benefitting from the rapid growth in DevOps / DevSecOps. Cyber Security: 3) Which vendors are executing well with XDR solutions, capturing share and potentially disrupting existing vendors? 4) Maturing of the End Point Protection market. 5) Growth for Zero Trust Network Architectures. Additional Themes: 6) Vendors successfully leveraging AI / ML. 7) M&A speculation.
Positive views include: Palo Alto, Cyberark, Five9, Snowflake, Ciena, Datadog. Cautious: ServiceNow, Salesforce, Tenable.
Technology Trends: Change, disruption and opportunity in 2022
1) The acceleration from legacy security solutions to the newer generation of solutions - SASE / shake-up of enterprise networking and network security (Zscaler, Cloudflare, Palo Alto Networks).
2) Leverage of AI in cloud-based communications and collaboration (CCaaS) to the advantage of vendors who are separating themselves from commodity services and pricing (Five9, NICE). Changing competitive landscape as Zoom, Microsoft, and others collide in the large and growing UCaaS market.
3) Further strength in BI / Analytics / Observability to the benefit of vendors with the strongest cloud-based solutions (Datadog, Dynatrace), but more mixed results from vendors transitioning to SaaS (Teradata, Elastic).
Technology
RNG has one of the best product portfolios in the UCaaS market as well as relationships with legacy vendors and service providers which will drive growth. Termination of the Zoom/Five9 merger will benefit RNG in the enterprise segment of the market. Expect the company to continue to beat estimates when it reports in November. TP $300 (~25% upside)
