Exclusive: Cisco AppDynamics Makes Significant Channel Strides As Partner Demand For AIOps Grows

Cisco-owned AppDynamics is now bringing in 70 percent of its business through partners as channel deal registration grew 60 percent year-over-year and partner-sourced business increased 154 percent, says Gardner Johnson, AppDynamics' new channel leader.

Cisco Systems' application performance monitoring software arm, AppDynamics, has dramatically increased its channel business as partners build businesses around APM and AIOps.

Four years ago, 80 percent of AppDynamics' business was direct to business customers. Today, the APM software provider has nearly flipped that dynamic, with about 70 percent of business being transacted through the partner ecosystem, Gardner Johnson, AppDynamics' vice president of worldwide channel, told CRN.

In just one year, AppDynamics has seen a 60 percent increase in deal registrations from partners, and 154 percent year-over-year growth in partner-sourced business, said Johnson, who has nearly two decades of enterprise software experience and came into the role of channel chief for AppDynamics in June.

"We've made significant strides and we've seen with that additional commitment to partners and partners definitely leaning in, we're seeing their investments increase significantly around AppDynamics," he said.

[Related: Cisco's AppDynamics Launches Integration Partner Program To Deepen Visibility For IT Teams]

Cisco acquired AppDynamics for $3.7 billion in 2017, one of the company's largest deals in years. Being a part of Cisco is helping AppDynamics and its partners land more deals, Johnson said. However, AppDynamics has its own channel program that is separate from Cisco's global partner program.

"That's critical because when [partners] are building a new practice area and launching new technologies, being able to predict what that return on investment is going to look like is extremely critical and being able to roll up under a separate program that provides a good profitability story is a key component of partner success," he said.

Globally, AppDynamics has 85 partners in total -- a number that increased more than 30 percent of the company's combined partners during the 2019 fiscal year. The company has 32 Titan-level partners and 53 Pioneer-level partners.

World Wide Technology (WWT), a Cisco Gold Partner and AppDynamics Titan partner, has created its own practice around APM and AIops, with AppDynamics being a cornerstone of that practice, said Tanner Bechtel, global practice director of APM/AIOps for WWT.

WWT has built expertise around not just provisioning services for deploying AppDynamics licenses, but taking that a step further, said Bechtel, who started WWT's APM practice two years ago.

"We wanted to take APM and roll in a lot of technologies we go to market with for enterprise organizations, and that led to us building a powerful partnership with AppDynamics, not just in terms of total revenue, but now being really co-conspirators of sorts in the future of AIOps," he said.

The partnership between AppDynamics and its partners is very mutual, Bechtel said. "In almost every partnership, you have someone that is overextending the other, but we have really forged an alliance and taken the best of both organizations."

APM applies to nearly every customer and it's helped WWT shift its entire business to focus on customer experience, Bechtel said. "It's almost a sea change -- a shift in the way we provide technology. We monitor things internally, whether it's the data center, security, cloud or an application, to ensure performance. What we are able to do with APM and AppDynamics; we are able to shift everything we do to focus on how our customers are experiencing that technology."

Cisco, for its part, has doubled its funding around the AppDynamics partner program, as well as its training programs, so that partners can adopt the technology at a quicker pace, Johnson added. Cisco is also providing plenty of integrations between products within its portfolio, such as Cisco ACI and CloudCenter, with AppDynamics' Central Nervous System -- the company's strategy for automating applications, infrastructure, and network.

AppDynamics in June introduced its Integration Partner Program aimed at pairing partners and customers with the right visibility tools. The partner program, which now includes 20 technology partners, are players that integrate with AppDynamics' application visibility tools, including software firms HashiCorp, Moogsoft, and ServiceNow.