Infoblox Forges Ahead with Subscription Model

To say the least, Infoblox’s customers are big. The company counts 350 of the Fortune 500 corporations as among its customers. HP, Boeing, Toyota, eBay, UBS, Huawei, Vodafone and Caterpillar are among the more visible names. Infoblox’s products basically protect a dizzying array of complex networks for enterprises and governments with typical user base exceeding 10,000 employees.

A compelling case for Infoblox

First off, Infoblox sells network appliances that manage internet addresses and identify devices connected to corporate networks. These appliances help IT departments manage related groups of technologies that together go by the acronym DDI (DNS, or Domain Name System; DHCP, or dynamic host configuration protocol; and IPAM, or Internet Protocol address management).

With the inevitable move of every big organisation to the Cloud (be it fully or hybrid), Infoblox’s roadmap is aligned along the same path and the company aims to bring DDI to the next level for their customers with their Secure Cloud-Managed Network Services. This enables each customer to go to the next level that’s right for them—whether their network is completely on-premise, full cloud or hybrid cloud. Infoblox DDI uses their patented Infoblox Grid technology to ensure high availability DNS, DHCP and IPAM services throughout these distributed networks.

Simply put, it is a network services and security company – they are the blokes who bring you to your intended URLs with peace of mind, whichever ‘transport mode’ you use, whether you are accessing on-premise, off-premise, roaming at branch offices or via apps anywhere. Protection for the network is no longer confined to a “castle and moat” approach but instead, extend itself to virtualised and cloud environments with no clear perimeters.

After all, Infoblox CEO Jesper Andersen had pointed out before that DNS is the number one pathway for malware. Globally distributed enterprises grapple with the flood of new requests for IP addresses and the onslaught of new network endpoints daily.

The reality is that the Internet of Things (IoT) era is nigh and approximately 30 billion devices are estimated to be connected by 2020. Therefore, with the explosion in demand for IP addresses and more applications, enterprise-grade DDI infrastructure is essential given that the “bad hats” are infiltrating deeper, from end-points to networks.

Loo explains that Internet Protocol version 6 (IPv6) is the most recent version of the Internet Protocol, the communications protocol that provides an identification and location system for computers on networks and routes traffic across the Internet.

With the exploding number of IPv6-enabled devices that will connect to networks, be it from laptops, mobile phones, printers, scanners or tablets, the global supply of dwindling IPv4 addresses means that organisations’ migration to IPv6 is gaining more traction. Not having an IP address is the equivalent of having a phone without a phone number, or a home without an address.

Lending his support to Malaysia, Hoke enthuses that the Asia Pacific Japan (APJ) region is poised to be the trail-blazer in driving the company’s number of order bookings.  Opened in late 2016, Infoblox Malaysia centre is built as an expertise, operations and support hub. Depending on the time of day (or night as the case may be), a user might find his queries being supported out of multilingual Malaysia. Over the last 12 months, the number of employees has increased from 10 to 18 and clearly, the office space is set up to fill up with many more.  

After all, the APJ region is said to have a 35% higher chance of cyber-attacks, which can be a good opportunity for sell-in for Infoblox. Notwithstanding, cost is always very competitive in Asia, whereby demand may be there, but customers are unwilling to pay the optimal premium pricing for it.

Notwithstanding, Infoblox attributes one of its advantages to being agnostic – perfect that the company is now taken private 100% by Vista Equity Partners, an American private equity fund, instead of by a gargantuan tech company. This means that the company is seen as independent, able to work with any other tech vendor and its ecosystem of partners to enhance their product offerings to customers, without being perceived as “competition”.

Interoperability with a multitude of system integrators/tech vendors’ solutions is a cherished advantage of Infoblox.

Endpoint security is never enough – akin to doing a deep dive into the layers of the ocean – corporations must likewise, protect every layer in their digital architecture, right down to the network. Because Infoblox manages networks, they are the specialists in protecting that very layer, oft brushed aside by the uninitiated top management. Khoo reveals that C-suite executives are often taken aback when her team does a demo that immediately reveals network breaches.

Synergies with its Acquirer

“I will never come over as CFO if Vista was not on board,” Hoke declares when asked about the repercussions of Infoblox’s US$1.6 billion acquisition by Vista in September 2016. Who could blame him, for after all, Vista has invested in hundreds of enterprise software companies, reputedly more than any others in the world.

The experience and support they bring on board is acutely felt by Hoke. He explains that when Infoblox was looking to shift its revenue model from perpetual licensing to a subscription-based model, they were there to assure the company that this could be done, what the trade-offs may be and how to navigate customer perceptions because Vista had journeyed along the same route and transformed many other investee companies.

“I would loath to have to explain to public shareholders the nuances of initial revenue dips in the transition to becoming a subscription-based company converting from upfront revenue recognition. Vista understands and leverages its myriad experience and guides us towards a structured way in making this transition,” Hoke adds. In Oct 2018, Infoblox revamped its entire infrastructure systems to reflect the shift – CRM, ERP, licensing, configuration, service tracking, revenue systems, etc.

Infoblox’s shifting revenue model

Towards the stated priority to drive customers to shift to the subscription-based model, Hoke reveals that in the last fiscal year ending 31st July 2018, Infoblox was well on track to hit its global one-third target. In the coming years, the number of order bookings is targeted to increase in the mid-teens % globally, with APJ predicted to be much faster.

Hoke justifies, “In many ways, being subscription-based holds important advantages for the customer with its flexibility, mirroring a cloud computing infrastructure. Any next generation tech upgrade is included in the subscription model, whereas in an upfront licensing model, the customer will need to pay all over again for the new upgrade.”


Another Vista advice Hoke finds value-adding is in supporting Infoblox’s choice of Tacoma, Washington as a “Centre of excellence for Technology Innovation” and a “Hiring Hub.” The site selection criteria focused on areas with higher education institutions that produce qualified computer engineering graduates, were close to established tech companies and offered a more affordable cost-of-living for its employees. Intense competition for tech talent is not as cut-throat, as it is in Silicon Valley, which is very disruptive.

As to Infoblox’s acquisition of IID, a leader in global cyber threat intelligence, in early 2016, it gave the company the powerful tool to synergise talents and enhance its Infoblox ActiveTrust product (although a renaming may be deliberated on and to be announced later).

So are there any more acquisitions on the horizon? Hoke confirms that for now, the company will chart its growth organically with its considerable pool of experience and talent happily amalgamated in.

NOTE: This piece was from EITN’s exclusive interview with Hoke I. Horne III, Infoblox EVP and CFO. Jessy Khoo (Country Manager, Malaysia) and George Loo (Director, APAC & Japan Customer Support) recently were present at the same interview.

Newly recruited in February 2018, Hoke I. Horne III,presents a measured, yet fresh, approach in his take as the newly recruited global Chief Financial Officer (CFO) at Infoblox. He brings along more than a working knowledge of the product, having worked through Accenture, McKinsey, Juniper Networks, Groupon, Microsoft and Digital River. From dispensing management consulting, implementing to hard-coding, it is all in a day’s work for this CFO, in charge of Finance, Accounting, Procurement and Legal functions in the twenty-year old Silicon-Valley company that has a commanding 50% share of market in the DDI networking space.