ZS: Gartner Magic Quadrant 2018

Here is a link to access the Gartner report in full: https://ir.zscaler.com/news-releases/news-release-details/zs…

If you were wondering, ZS is again at the top right of the graphic (that’s where you want to be). Here are some quotes I took from the report but I would recommend reading the whole thing if you own shares:

– Zscaler continues to be one of the fastest-growing and most innovative vendors in this market. It has the largest installed base of customers of any of the cloud-based SWG providers.
– Zscaler Private Access is a software-defined perimeter (SDP) offering, that Zscaler positions as a VPN replacement solution. ZIA directly peers with most of the popular SaaS providers, including Office 365.
– Zscaler is a strong choice for enterprises seeking a cloud SWG service.
– Zscaler applies all its malware detection engines to all content, including SSL/TLS traffic, regardless of site reputation or customer entitlements. With 55 billion transactions per day, this approach yields improved threat intelligence and site reputation verdicts.
– Zscaler continues to lead the market in innovative cloud features.

Cautions were basically that they are smaller than some of their competition and, thus, can’t offer everything. Also, if you want on-premise solutions you shouldn’t go to ZScaler. (Duh’…)

About competition

I ordered competition in two brackets and quickly summarized my thoughts:

No competition

McAfee, Forcepoint, Cisco = legacy technology

Content Keeper = only Australia/US

Sangfor = only China

Menlo Security = New entrant with high security; but very small ($85 mil in funding only); uses VPN still and only on AWS

Barracuda: In 2018, Barracuda terminated its reseller partnership with Zscaler, and it introduced the Barracuda Content Shield (BCS) — a DNS-based SWG cloud service… The cloud-based BCS is a new service that has been available only since September 2018… The BCS is Barracuda’s third attempt at offering a cloud-based SWG service.

Real competition

Symantec = highest market share; in August announced to lay off 8% of the workforce in restructuring efforts; strong products and support but the products are expensive.

iboss = cloud solution is built on a proprietary, node-based technology, which it refers to as “containerized gateways”; they are cloud only since 2017; iboss’s partnership with Verizon (as of June 2018) enables it to deploy containerized gateways throughout Verzion’s worldwide infrastructure (more than 110 points of presence); has demonstrated an ability to develop technology partnerships that enable it to quickly respond to market dynamics. Examples include Menlo Security, FireEye and Microsoft’s Cloud App Security service.

It is quite obvious that iboss is the number one competitive threat to ZScaler at the moment (Tinker already pointed this out multiple times across our boards). ZS has the advantage of being much bigger and more global but still, this situation should be monitored. Symantec is also a strong competitor but is probably falling behind with their recent internal problems. Anyways, ZS seems to have a very strong competitive position and although Gartner obviously tries to sound objective in their report I couldn’t help to notice that they seemed a bit more excited about ZScaler and iboss than all the other companies in the report (but maybe that could also be my own bias).

Fool on



How confident are we that the ZIA/ZPA competition is still limited?

So, I read an article on ZS on SA today ---- https://seekingalpha.com/article/4244051-zscaler-angels-fear….

This guy is a short and cites CHKP’s recent acquisition of Dome9. I read the Dome9 acquisition from Oct 2018 and couldn’t make heads/tails of it ---- is it really competition? He also cited PANW and SYMC.

I’m guessing I can take the ZS article from SA and toss it in the circular file ---- yet I’d thought I’d check w you/rest of our board for a quick sanity check.