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40 YEARS AS THE VOICE OF THE CHANNEL

KASPERSKY CUSTOMERS ‘SCARED’ BY THREATS OF US SANCTIONS: PARTNERS

“[Customers are] thinking, ‘Well, if I’ve chosen Kaspersky, is my boss going to
fire me if something happens?’ Just the optics right now, it’s troubling,” said
one solution provider CEO who partners with Kaspersky.

By Mark Haranas March 31, 2022, 01:51 PM EDT
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Kaspersky customers are “scared” as the U.S. government eyes potential sanctions
against the Moscow-based cybersecurity firm, with U.S.-based Kaspersky clients
looking to replace the vendors security products, according to Kaspersky channel
partners.

“Customers that are coming up for renewal are obviously looking
elsewhere—they’re scared,” said one solution provider CEO who partners with
Kaspersky and declined to be identified. “People don’t know if this is just some
kind of geopolitical BS? Or is there really something there? They’re thinking,
‘Well, if I’ve chosen Kaspersky, is my boss going to fire me if something
happens?’ Just the optics right now, it’s troubling.”

The CEO said he’s seeing customers starting to drop Kaspersky cybersecurity
products and look to implement competitor solutions due to fear.

“The board of directors [of Kaspersky clients] are saying, ‘We are not going to
use this anymore. Find something else.’ I mean, it’s no different—or I guess
it’s a little different—to people pouring out Russian vodka. ‘Hey, if it’s got a
Russian stamp on it, let’s get it out. I don’t want to get canceled,’” said the
CEO. “It’s a no-win situation for everybody.”

Solution providers tell CRN that Kaspersky is planning to conduct an all-hands
meeting or town hall meeting earlier next week to discuss the matter.

[Related: Biden Administration At Odds Over Sanctioning Kaspersky: Report]

The National Security Council has pressed the Treasury Department to ready
sanctions against Kaspersky amid longstanding allegations that the Russian
government could exploit Kaspersky’s technology to install malicious software on
the networks of its customers. However, sanctions experts with the Treasury
Department have raised concerns over the size and scope of the punishment being
considered for Kaspersky, according to a report by The Wall Street Journal.

Kaspersky Responds

Kaspersky has said it strongly denies the accusations along with alleged links
to Russian intelligence services.

“The U.S. Government’s lack of response to Kaspersky’s good faith outreach,
while proceeding to take actions to further limit Kaspersky, clearly indicates
that such regulatory restrictions are political decisions based on speculation
rather than facts,” Kaspersky told CRN in an emailed statement.

Although Treasury officials have been working to prepare a sanctions package,
one official told The Wall Street Journal that sanctions against Kaspersky have
been put on hold for now.

Partners: ‘It’s A Bad Situation All Around’

Although channel partners are reaching out to Kaspersky customers to let them
know about the situation, many clients are reaching out to solution providers
themselves to express concerns.

“Customers are calling us about [Kaspersky], but we’re also being proactive in
making our customers aware the situation—it’s our job,” said one top technology
executive from a solution provider who partners with Kaspersky who declined to
be named. “We pass along relevant U.S. government activity that is being
published that they need to know. ... It’s a bad situation all around.”

Partners told CRN that Kaspersky is “trying to put the best face on” for
partners, but the amount of fear from customers is at an all-time high.

Partners aren’t faulting Kaspersky for the situation regarding possible
sanctions. However, the problem had been escalating quickly since Russia’s
invasion of Ukraine last month, which has now hit a breaking point.

“We worked with Kaspersky for years. They are great people. And they are in a
bad spot by no fault of their own,” said the CEO. “But just type in ‘Kaspersky’
in Google and see what you find. There are millions of news articles. … Over the
last year, our Kaspersky sales were up—until a month and a half ago.”

The top technology executive said he’s currently selling several Kaspersky
customers new cybersecurity solutions.

“We sell a lot of security solutions. So all options are on the table. We’re not
asking or encouraging customers to move. But if they have to, we will support
them and offer recommendations,” he said. “There are a lot of good products out
there. So it’s not that any one sticks out to replace Kaspersky, there’s a lot
of them.”

Kaspersky said it will continue to assure its partners and customers on the
quality and integrity of its products and remains ready to cooperate with U.S.
government agencies to address the FCC and any other regulatory agency’s
concerns.

Kaspersky Saw A ‘Resurgence’ From 2017 Ban

Channel partners said they’ve seen a Kaspersky sales “resurgence from the
geopolitical issues” that hit the Russian security firm in 2017.

In December 2017, former U.S. President Donald Trump signed a broader defense
policy spending bill that banned Kaspersky‘s software from both civilian and
military networks. The ban on U.S. government sales made many American customers
reluctant to purchase Kaspersky’s technology even though sales weren’t outright
prohibited.

“Kaspersky had been making great strides and their reputation had been coming
back and people were kind of forgetting about the last geopolitical issues. And
then, this. We don’t know what’s going to happen,” said the CEO. “It’s too
fresh.”

However, other partners dropped Kaspersky outright in 2017.

LAN Infotech, a Fort Lauderdale, Fla.-based MSP, moved hundreds of customers off
Kaspersky software in 2017 after the U.S. government banned the use of Kaspersky
software in federal information systems because of concerns about Kaspersky’s
links to the Russian government.

“We removed all of the Kaspersky software from our customers systems in 2017
based on the chain reaction in response to the US government ban.” said
Goldstein. “My heart goes out to the Kaspersky partners who are dealing with
this now. At some point you need to draw a line in the sand. That’s what we did.
It was not a technology decision. It was a reputational decision for customers.”

Kaspersky co-founder and CEO Eugene Kaspersky needs to “get out in front” of the
allegations of ties to the Russian government, said Goldstein. “I’m surprised
Eugene isn’t taking a more prominent public role to battle these charges,” he
said. “Eugene is Kaspersky. He needs to get out in front of this if they want to
continue to succeed in the U.S. market.”

Kaspersky: Sanctions Based On ‘Unsubstantiated Allegations’ Without ‘Evidence’

In today’s statement, Kaspersky said it maintains that the U.S. government’s
2017 prohibitions on federal entities and federal contractors from using
Kaspersky products and services were not only unconstitutional but also based on
unsubstantiated allegations and without any public evidence of wrongdoing by the
company.

“As there has been no public evidence or due process to otherwise justify those
actions since 2017, and the FCC announcement specifically refers to the
Department of Homeland Security’s 2017 determination as the basis for today’s
decision, Kaspersky believes today’s expansion of such prohibition on entities
that receive FCC telecommunication-related subsidies is similarly
unsubstantiated and is a response to the geopolitical climate rather than a
comprehensive evaluation of the integrity of Kaspersky’s products and services,”
Kaspersky said in a statement last week.

If sanctions are implemented against Kaspersky, it would not be the first time
President Joe Biden’s administration sanctioned Russian companies for their
relationship with the Russian government. In April 2021, the Treasury Department
sanctioned six Russian technology vendors for helping the country’s intelligence
agencies carry out malicious cyber activities including the SolarWinds hack.

“Kaspersky has been doing very well over the last couple years. I don’t know
what’s going to happen now,” said the technology executive. “This is somewhat
unprecedented.”

In a CRN 2022 CEO Outlook questionnaire, Kaspersky said the key to success for
Kaspersky partners in 2022 is offering comprehensive cybersecurity solutions
“from the early stages of endpoint protection, through to the complexities of
cyberthreat intelligence and – arguably the most important step- incident
response.”

As for his own top priority, Kaspersky replied: “Saving the world from
cyberthreats! I’ve had the same priority for 25 years.”

Related Topics:
* Cybersecurity
* Current Threats
* Threat Management
* Managed Security

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