U.S. Ban of Kaspersky Software Will Leave a Mark

Cybersecurity Shield
2112 Group's Larry Walsh

Larry Walsh

By Larry Walsh, CEO and Chief Analyst, The 2112 Group

The U.S. government’s ban of Kaspersky Lab software from its networks and computers this week comes as no surprise as it caps a long and slow stretch of scrutiny of the Russia-based security vendor. Nevertheless, the federal government’s decision could have broad implications for the company’s commercial sales.

While Kaspersky Lab, which often refers to itself as “Team Green” – a reflection of its corporate color – does little business with U.S. government agencies, the label “threat to national security” will leave an indelible mark on the Russian security bear’s brand and create a barrier to sales for its partners.

U.S. government regulators tagged Kaspersky as a potential threat to national security, saying the company’s close ties to the Kremlin could allow it to leverage its software for surveillance and espionage.

In a statement, the U.S. Department of Homeland Security said, “The risk that the Russian government, whether acting on its own or in collaboration with Kaspersky, could capitalize on access provided by Kaspersky products to compromise federal information and information systems directly implicates U.S. national security.”

Kaspersky Lab, often rated as one of the most effective antivirus and malware protection vendors in the world, says the U.S. government offered no evidence of collusion between it and any government intelligence apparatus. In response, founder Eugene Kaspersky tweeted, “guilty until proven innocent.”

Kaspersky tweet













Still, the U.S. government’s decision is a blow to Kaspersky Lab, which spent years trying to curry favor with Washington insiders and government agencies. The company enlisted the likes of former National Security Agency director Michael Hayden and former White House cybersecurity czar Howard Schmidt to help navigate the Beltway corridors of power and influence.

By many estimates, the impact of Washington’s decision to kick out Kaspersky from federal sales will have little direct impact on the company’s revenue and operations. U.S. federal government sales represent a tiny fraction of the company’s global sales. The direct collateral impact on commercial and consumer sales remains to be seen, as the U.S. market represents at least one-fifth of the company’s global revenue. Since the U.S. government began scrutinizing Kaspersky Lab, reports indicate that the company’s sales to U.S. commercial customers and consumers have fallen. Over the past two years, numerous executives that drove Kaspersky Lab’s regional growth left the company. And security vendors such as Symantec, McAfee and Sophos no longer consider Kaspersky a credible competitive threat, despite recent moves to revitalize its channel presence. Those include recent hires of former Fuze and XO executives.

Even before the U.S. government announced its ban, Best Buy – the country’s largest retailer of consumer hardware and software – said it was pulling Kaspersky products off its shelves. While it’s unknown how much of an impact the Best Buy decision will have on Kaspersky Lab sales, the broader impact is huge. The Best Buy move signals a confirmation to the rest of the market that the U.S. government’s suspicions are credible.

In the B2B channel, solution providers continue to swear by the quality and profitability of Kaspersky Lab software. Kaspersky Lab’s channel programs are …

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One comment

  1. Avatar craig kensek September 14, 2017 @ 10:37 am

    This sounds like a version of Huawei, several years ago, when the government (and some competitors, of course) expressed concern about potential backdoors and issues with Huawei’s business solutions. Congress and the Senate should not be in this business. If past relationships with the government were a reason to be banned, there are a handful of countries and security vendors (including favored partners), that would be affected.

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