Security distributor First Defence is believed to be the latest victim in a burgeoning security channel shake-out as players face tough market competition.
First Defence, which sells products from Computer Associates (CA), Symantec, KeySecure and Waterford Technologies, is believed to have ceased trading and sources expect it to soon enter administration.
A source close to the company said: "First Defence has ceased trading with a view to going into administration." A second source contacted by VNU News Centre confirmed this as correct.
Despite repeated attempts to contact First Defence, it was unavailable for comment at the time of going to press.
Bernie Dodwell, sales and marketing director at security distributor Allasso, insisted that the news was not a shock because IT security distribution is beginning to see a shakeout, with companies such as Peapod going into administration.
"From a distribution point of view the market is still growing, but there are more players competing for the business," he said.
Dodwell suggested that First Defence's troubles could be down to its small vendor portfolio. "Smaller second-tier distributors are struggling with the competition," he explained.
Lee Harrison, business development director at E92plus, agreed that a small portfolio can lead to problems for security distributors.
"If a reseller can get a wider range of products from another distributor it is more attractive," he said. "We are seeing a shake up and vendors, distributors and value-added resellers are having to turn up the heat just to tread water."
First Defence is the niche security distributor used by CA to supply and support resellers.
Dave Ball, indirect marketing manager at CA, said that it has been working with First Defence for about six months and that the news came as a shock.
"We were surprised and disappointed by the news that the distributor had gone down," he said.
Ball indicated that CA will be looking for a replacement for its security specialist distribution role. "We are open minded but we will look for a security specialist," he confirmed.
An industry source said that "CA is already actively seeking a replacement distributor".
Waterford Technologies is in start-up mode in the UK and a spokeswoman suggested that the development will have little effect on the vendor and its partners.
"All of our resellers selling through First Defence will be transferred to Unipalm," she said.
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