Arista Networks’ management is eager to tap into VeloCloud’s channel program opportunities that analysts have cited as ripe for exploitation following that channel’s rollercoaster existence under previous owner Broadcom.

Arista's newly named COO Todd Nightingale during the vendor’s latest earnings call reiterated the importance of VeloCloud’s managed service provider (MSP) legacy to Arista’s growth ambitions.

“[VeloCloud] fills an enormous hole in the in the enterprise campus portfolio for the distributed branch, and being able to bring [VeloCloud] technology through our traditional Arista channel, it gives us an opportunity to cross sell SD-WAN into so many existing campus accounts with the existing Arista go-to-market, which is amazing, but [VeloCloud] has a really strong MSP motion,” Nightingale said. “We’re pushing really hard right now and really embracing that, not just to continue to develop success but to now bring all of Arista’s portfolio through that same channel, through those same partners and really embrace that MSP motion and use the [VeloCloud] intellectual property in their business operation in order to learn from that and bring that MSP motion to all of Arista’s portfolio.”

Nightingale joined Arista on July 1, the same day Arista officially announced its VeloCloud purchase. Nightingale previously served as CEO at Fastly and before that as head of Cisco’s enterprise networking and cloud business. Nightingale left that latter position in mid-2022 as part of Cisco’s move to combine that enterprise networking and cloud business with its Mass-Scale Infrastructure Group under the purview of Jonathan Davidson, who subsequently left Cisco last year following the vendor’s most recent corporate restructuring effort.

Analyst firm William Blair noted in a report tied to Arista’s VeloCloud acquisition that the latter brought more than 18,000 customers “and a strong relationship with the service provider channel to Arista.”

“The combined portfolio will enable Arista customers to connect from data center to branch to campus to cloud across a single fabric, allowing it to compete more effectively within the enterprise against industry leader Cisco and its Meraki/Catalyst portfolios,” the financial analyst firm wrote.

However, William Blair also pointed to the need for Arista to shore up that partnership opportunity coming out of what was a hectic 18 months under Broadcom’s umbrella.

“Arista will have to rebuild some of the trust in the channel, with many of those relationships having frayed following Broadcom’s takeover,” the financial analyst firm wrote.

Arista had previously noted that it would maintain some of the changes Broadcom had made to VeloCloud’s partner program during its brief ownership. One most dear to the intended channel audience is the VeloCloud Titan partner program, which will be re-branded as “VeloCloud MSP,” but continue with the architecture it inherited from Broadcom last year.

Sanjay Uppal, who is one of the co-founders of VeloCloud and served as VP and GM of Broadcom’s Software-Defined Edge division before the Arista deal that now has him serving as GM and VP, explained that the VeloCloud Titan program followed Broadcom’s stated push of simplified licensing portability.

“Previously, what we would say is, if you're a partner then you have to identify which end enterprise that you're providing these licenses to,” Uppal said. “With the new Titan partner program, that's going to be simplified so you can actually port licenses from one to another, not across geographies, but in the same geography.”

This aligned with license portability changes that have drawn considerable consternation from long-time VMware customers used to perpetual licenses.

Mauricio Sanchez, senior director for enterprise security and networking research at Dell’Oro Group concurred, explaining to SDxCentral that Arista will have its work cut out in terms of re-energizing momentum around VeloCloud.

“I haven't run into any channel partners that are necessarily happy with the relationship with Broadcom, especially on the VMware side,” Sanchez said. “Even though VeloCloud hadn't got sucked up into that completely … the tractor beam had been put there, but now the fact that VeloCloud is outside of that tractor beam is going to play into goodwill for people. They’re going to maybe say, ‘Arista is a networking company, and they clearly are very engineering driven there. They care about delivering good technology.’ So I think there's going to be a significant amount of goodwill or benefit of the doubt.”

Two paths toward SASE

Nightingale also told investors that Arista’s initial VeloCloud focus will continue to rely on security partners to power secure access service edge (SASE) offerings.

“We are looking very carefully at how we support customers from a fully integrated SASE/SD-WAN solution. It's a secure WAN that matters and delivering that solution with great assurance is something that certainly is top of mind for us.” Nightingale said. “But I think we have a real opportunity to do that with partners. … There's so many amazing cloud security vendors out there right now, and we have so many customers that work with the [VeloCloud] solution along with those partners, that's, I think, the way we're going to be leaning in moving forward. But certainly, we'll be talking more about that at our investor day later this year.”

CEO Jayshree Ullal added further clarity, noting that Arista views the SD-WAN market as having hit a “fork in the road.” This divergent path will lead Arista to building more internally and the other toward continued partnerships.

“If it's just simple security, encryption, segmentation, firewall, we can do that,” Ullal said. “But if it's really the cloud security like Zscaler or Palo Alto [Networks] do, we will absolutely work with best-of-breed partners and not pretend to be something we're not.”

Sanchez noted that VeloCloud’s SASE angle could be a significant growth opportunity for Arista if it’s played correctly.

“It gets Arista one foot into the enterprise WAN landscape but they need to quickly decide do they want to play with what they have and just extract as much value out of the current technology that they have or do they want to commit to continue to expand their SD-WAN [market opportunity] to the full SASE [market opportunity]," Sanchez said. "Because right now, they only cover, let's just say 30% to 40% of the SASE opportunity, which that 30%, 40% is net new for Arista, but that means that there's another 60% to 70% that is still there for them to take home.”

That decision could mean another potential Arista acquisition, this time focused on cybersecurity or SSE.

“They need to have the conversations about, ‘well, are we going to be happy with the returns on just the constrained part of the market that we're going to go be able to go attack,’ or do they have the desire to go capture the flag at top of the hill and go all in by acquiring an SSSE vendor,” Sanchez said. “I don't think there's necessarily, near term, an easy answer for that. I think they need to really analyze what their appetite for risk and the expansion is.”