Channel Marker

December 6, 2019  8:57 PM

MSP automation taps PowerShell as multi-tool

John Moore John Moore Profile: John Moore
Automation, Channel, Managed Services, MSP, Powershell

PowerShell serves as the Swiss army knife of MSP automation.

Indeed, Microsoft’s PowerShell scripting language has become a highly versatile tool for managed service providers (MSPs). PowerShell scripts plays multiple roles, including in software installation and integration, report creation, policy enforcement, customer onboarding and new user account creation. An MSP’s imagination is perhaps the only limit on PowerShell’s applicability.

Wider use of PowerShell and automation, in general, has critical implications for MSPs. A service provider’s efficiency and profitability increasingly depends on its ability to minimize manual tasks. Automation’s benefits cut to the bottom line when MSPs devote fewer technician-hours to on-site client work or shrink the volume of mundane administrative chores. MSP automation also helps service providers manage the daily challenge of juggling multiple customers and their varied IT environments.

Multiple roles

Shawn Sachs, senior solutions architect at Generation IX, an MSP based in Culver City, Calif., has written numerous PowerShell scripts, covering use cases such as software integration and reporting. But his use of PowerShell continues to evolve. Sachs said he is now considering pursuing configuration management through PowerShell.

To that end, Microsoft offers Desired State Configuration (DSC) as a configuration management tool within PowerShell. DSC, which Sachs likened to Ansible and Chef, revolves around PowerShell scripts that describe an IT environment — devices such as servers and their particular attributes. DSC’s monitoring capabilities check the configuration for continued compliance.

In addition, Sachs said he plans to look into PowerShell for Mac OS X. “I’m very curious to see how that is going to change the game as far as Mac management and bringing Macs into enterprise environments,” he said.

Cultural change via MSP automation

PowerShell’s use as an MSP automation multi-tool marks a cultural shift. Many MSPs originally pursued a break/fix business model: they waited for something at the customer’s location to fail and then provided services. That approach encouraged service providers to focus on hourly rates and making sure technicians were as close to 100% billable as possible. Automation wasn’t particularly essential to that formula.

MSPs, however, are transitioning from a billable-hours mentality to “all-you-can-eat” pricing and monthly recurring revenue, noted Brett Cheloff, vice president for ConnectWise’s Automate remote monitoring and management product. The emphasis now is on spending the least amount of time with customers, while still making sure their systems are well-maintained and running properly.

“It’s completely inverted,” Cheloff said, referring to MSPs’ business philosophy.

Automation works in lockstep with MSPs’ emerging service-delivery methods and pricing models. Look for PowerShell, low-code/no-code offerings and robotic process automation to grow in importance among service providers.

November 27, 2019  9:53 PM

Understanding co-managed IT services

Spencer Smith Spencer Smith Profile: Spencer Smith
Managed service providers, Managed Services, MSP

MSPs sometimes avoid prospective clients that already have internal IT staff, but by taking the co-managed IT services approach, they don’t have to.

That’s according to Bob Coppedge, owner of Simplex-IT, an MSP based in Stow, Ohio. Co-managed IT services, or CoMITS, is a model for developing mutually supportive relationships with customers’ internal IT teams. Coppedge has helped pioneer the strategy, even writing a book on the subject. He discussed the CoMITS approach at the IT Nation Connect conference, held Oct. 30 to Nov.  1 in Orlando, Fla.

“In my opinion, with some very critical exceptions, most MSPs can do this,” Coppedge said of CoMITS in a conference session.

Internal IT teams and MSPs very often regard each other in a competitive, adversarial light, Coppedge said. The presence of an MSP can be threatening to internal IT people, giving them the impression that their value or even their jobs are at risk. MSPs often don’t do much to dispel these concerns. “One of the problems is, for the last 10 years, MSPs have been by default walking in and going, ‘Oh, you’re the IT person. … I’m more efficient …. more effective … [and] up-to-date,’ ” he said.

“By and large, IT people … expect [MSPs] to be adversarial, because they are coming in and doing stuff that they can’t, and usually not showing them how,” Coppedge added.

CoMITS aims to help MSPs create a win-win relationship with the internal IT staff. The approach that Coppedge advocates involves forming a tight partnership with IT staff and sharing abundantly with the team. He said MSPs can share their best practices, methodologies as well as access to their tools. In part, CoMITS looks to instill the idea among IT people that they remain owners of the IT. “It is still their IT. We aren’t taking it away. We are partnering with them and making it better,” he said. “They can … say, ‘We did it.’ … This is critical. … You can actually be a mentor to the internal IT to make them stronger.”

Co-managed IT services “can be a fantastic relationship builder for organizations if you do it right,” Coppedge said.

November 27, 2019  8:20 PM

MBX Systems reinvents itself in computer hardware manufacturing

Spencer Smith Spencer Smith Profile: Spencer Smith
Business model, Manufacturing, Vertical markets

Twenty-five-year-old MBX Systems, a computer hardware manufacturer, is an example of how technology companies can continually adapt to the ever-changing marketplace.

In 1995, the organization started in the consumer space as Drive Express (later Motherboard Express), focused on selling technology components to enthusiasts building their own hardware systems. As the market commoditized, the company pivoted to building and selling systems, before seeing a need to pivot again as Dell and Gateway gained dominance. In the early 2000s, MBX Systems identified an opportunity in the emerging market for enterprise dedicated-use systems.

“We transitioned completely out of the consumer market and then into the enterprise market. … We have been really focused in that area of dedicated-use systems since then,” said Chris Tucker, president of MBX Systems, headquartered in Libertyville, Ill.

Since making the enterprise shift, MBX Systems has continually modified its approach to keep solid footing. Today, the company is pursuing a deep vertical market strategy and differentiating itself with manufacturing orchestration software it developed internally.

Responding to changing customer preferences

In 2017, MBX Systems took note of a couple of market trends to which it saw a need to respond.

The first trend was its software provider customers moving toward alternative deployment methods, such as cloud computing, virtualization and containers, Tucker said. Customers had begun distributing their deployments much more broadly, making them less dependent on the hardware that MBX provided. As a result, MBX rapidly lost spending from “a decent portion” of its customers, he said.

The second trend was that customers wanted to consume data in a different way than before. “We were getting more questions, a higher expectation of information and a higher level of granularity” in the information requested, Tucker said. He noted that customers sought a level of transparency  similar to what Amazon provides consumers, where an Amazon buyer can see each step of an order’s journey, from purchase to delivery. “People were asking for that same level of granularity from us as a manufacturer or integrator of products.”

Taking these trends into account, MBX retooled its focus.

Hardware in search of a market

The first adjustments MBX Systems made were to the customer segments it targets. The company started looking at market segments that require on-premises, high-performance needs, Tucker said. The investigation led MBX to zero in on niche vertical markets, ultimately choosing three to invest in: the video streaming segment of the broadcast market, flight simulation and physical security surveillance.

“Over the course of two or three years, we transitioned most of our business out of those traditional markets and into these markets where the hardware was still required,” Tucker said.

Tucker said MBX “took a very structured approach” to entering the vertical markets over a two-year period. In the first year, MBX focused on identifying and building the skillsets and tools it would need to target the markets and “gain interest in one or two banner accounts.” In the second year, MBX moved to bring those new customer accounts onboard and then leverage them to win additional accounts.

“Over the course of 24 to 36 months, we were able to swing our core business, which was our old traditional business, which was maybe 70% to 80% of our business typically … to where we have now flipped that on its head” in sustainable, vertical business, Tucker said.

He noted that MBX remains on the lookout for additional vertical markets it could expand its business.

Developing Hatch software

MBX Systems responded to customers’ demand for higher levels of data visibility by creating a software toolset called Hatch. Hatch aims to provide customers with a hub for managing complex hardware programs, Tucker said. Customers can use Hatch for a range of functions, including customizing product configurations, managing engineering changes and tracking shipment status, according to MBX. Additionally, Hatch offers inventory management, work-in-process tracking and global compliance intelligence.

The introduction of Hatch “made a big difference” to MBX’s customer base, Tucker said. He added that the majority of MBX customers today use Hatch and the company is betting on the software to be its key differentiator among competitors. “When a customer or a prospective customer sees Hatch for the first time, you can see their eyes light up. You can see them understanding the problems that it is solving, and you can see them understand the labor and cost savings of this unit,” he said.

However, while ultimately rewarding, the release of Hatch initially posed challenges because it required MBX to expose almost all of its data to customers.  “There is a reason that some companies don’t make the decision to open their kimono and share all the data. Some of the decisions that we made in doing that … exposed some of the warts that we had in our internal processes,” he said.

“Over time what it did was build trust, but initially [it] was difficult to expose some of the creaks and the strains of actual manufacturing,” Tucker said. He noted that with the data exposed, MBX works even harder to adhere to high standards.

Hatch has also helped MBX plant its flag in the vertical markets it targets. Tucker said customers in those verticals are receptive to Hatch because none of the other manufacturing players in those markets offer anything like it. “One of the reasons that we picked those markets is that they were really ripe for disruption,” he said.

November 27, 2019  6:46 PM

IT channel news: Buyout target Tech Data sees 2% drop in sales

John Moore John Moore Profile: John Moore
Channel, Channel partners, distribution

IT channel companies continued to make news during the shortened Thanksgiving work week. Here’s a quick summary:

  • Distributor Tech Data reported a 2% year-over-year decrease in third quarter sales, with a drop in European revenue the key contributor. The company generated worldwide sales of $9.1 billion for the quarter ended October 31. Gross profit increased 1% for the quarter. Tech Data said it does not plan to hold an earnings call or provide forward-looking guidance, citing its pending sale to Apollo Global Management. Apollo, a private equity firm, agreed to purchase Tech Data in a transaction valued at $5.4 billion.
  • DLT Solutions, an IT aggregator based in Herndon, Va., has captured a contract to provide SaaS offerings, support and other services to state, local and education agencies in Texas. The contract with the Texas Department of Information Resources could run through October 2025, if all options are exercised. DLT’s IT channel partners can tap the contract through the company’s Contract Access Agreement program. Tech Data in October agreed to acquire DLT, in a deal expected to close by the end of 2019.
  • D&H Distributing, a distributor based in Harrisburg, Pa., said it will boost credit lines for about 600 of its IT channel partners, which include value-added resellers and retailers. The $21.5 million increase, spread across the selected partners, will help those companies pursue larger projects, enter new markets or capture a larger business volume, according to D&H.
  • The NPD Group’s B2B Distributor and Reseller Tracking Service reported a 3% uptick in year-over-year sales growth through the third quarter of 2019. The Port Washington, N.Y., company noted software sales outpaced hardware sales, with software rising 9% compared to a 1% increase for hardware. IT operations and networking software represented the largest dollar share of overall B2B software and cloud services sales, according to the tracking service.
  • Distributor Ingram Micro has bolstered its Salesforce expertise. The company this week purchased the Salesforce consulting practice of Quosphere, a global IT firm with U.S. headquarters in New York .
  • Lastline, a security and breach detection vendor, inked an agreement with immixGroup, the public sector IT distribution subsidiary of Arrow ECS. Lastline said the agreement enables immixGroup partners to sell its network detection and response platform to federal, state and local government agencies.
  • Avaya said distributor Synnex Corp. is now providing Avaya OneCloud Secure unified-communications-as-service products to partners in the U.S. public sector market.
  • Windstream Enterprise, a managed communications service provider, recently restructured its channel organization. The company promoted Matt Milliron from vice president of channel sales to head of strategic channels, replacing Curt Allen. Allen will move into an advisory role, consulting with Milliron and Windstream executives on the channel, the company said.
  • Anexinet Corp, a digital business solutions provider based in Philadelphia, has appointed Robert Sheinker as vice president of partner strategy. Sheinker is responsible for vendor partnerships, with a focus on hybrid cloud, hyper-converged technology, flash storage, networking, virtualization and security offerings.

Additional reporting by Spencer Smith.

Our usual Market Share IT channel news roundup resumes next week.

November 26, 2019  3:55 PM

Consultant’s free FedRAMP readiness assessment tool gets early looks

John Moore John Moore Profile: John Moore

Quzara LLC, a consulting firm based in Reston, Va., has rolled out a FedRAMP readiness assessment tool, conducting 30 reviews of independent software vendors and cloud providers in its first 60 days of availability.

FedRAMP, which stands for the Federal Risk Authorization Management Program, is a government-wide initiative to provide a seal-of-approval of sorts for companies offering cloud services to federal agencies. The program spells out a standard process of security assessment and authorization.

The Office of Management and Budget established FedRAMP in 2011, and requires any cloud service holding federal data to be authorized under the initiative. It conceived the program to facilitate cloud adoption, but industry executives have viewed the process of vetting cloud security as time-consuming and expensive. Smaller cloud providers, in particular, have balked at the expense and complexity of getting their offerings FedRAMP authorized.

Against that backdrop, Quzara launched its FedRAMP readiness assessment tool, dubbed FRAT. Saif Rahman, Quzara’s co-founder and managing director, said the big players in cloud — AWS and Salesforce, among others — had the deep pockets to invest in FedRAMP compliance six or seven years ago. But that potentially leaves thousands of other cloud providers on the sidelines.

“We have a bunch of smaller ISVs and SaaS [providers] that want to get into the federal market, but are finding it extremely difficult,” Rahman said.

The FRAT tool aims to reduce the expense of FedRAMP. The authorization process starts with a FedRAMP readiness assessment, which determines the extent to which a vendor’s cloud meets FedRAMP controls — or fails to do so. The readiness assessment typically costs around $50,000 on average, with the price tag rising to $100,000 in some cases, Rahman said. The cost of the preliminary cloud check is a deal breaker for many FedRAMP aspirants.

“Seventy percent of the conversations die there,” Rahman said.

FRAT, however, is a free, web-based tool that lets cloud vendors conduct a self-assessment based on a reduced set of security controls. For example, FRAT narrows the 325 controls for a FedRAMP moderate security baseline to 100 of the most critical controls, Rahman explained.

Quzara and its cloud customer discuss the results of the self-assessment in a two-hour workshop, also free of charge. After the talks, clients come away with an understanding of the cost and level of effort required to achieve FedRAMP compliance, Rahman said.

“We help them build a FedRAMP roadmap,” he said. That guidance includes an initial timeline for achieving authorization and a prioritized to-do list for meeting FedRAMP requirements.Cloud formation

Companies participating in FRAT assessments thus far have included the expected smaller ISVs, but also larger entities. Rahman cited the example of a defense contractor with multiple data center-based applications it plans to turn into cloud services.  The contractor needs FedRAMP authorization for each one, a costly proposition for even a sizable enterprise.

For Quzara, the no-cost FedRAMP readiness assessment has kept alive conversations with prospective customers, and could lead to fee-based business down the road. In the meantime, Rahman said the early interest in the assessment is encouraging.

“There’s a market that is hungry for real data,” Rahman said.

November 13, 2019  8:43 PM

Apollo begins countdown to Tech Data acquisition

John Moore John Moore Profile: John Moore
Acquisitions, Channel, distribution

Private equity firm Apollo Global Management has inked an agreement to acquire distributor Tech Data Corp. But the buyout terms leave the door open for other suitors.

Tech Data, based in Clearwater, Fla., ranks among the top IT distributors, offering resellers a range of hardware, software, networking gear and consumer electronics products. The company has also moved into cloud distribution in recent years, providing its StreamOne Cloud Marketplace.

The transaction, expected to close in the first half of 2020, has an enterprise value of about $5.4 billion, according to Tech Data. Enterprise value is a measure that takes into account factors beyond market capitalization. Rumors of the Tech Data acquisition surfaced in October.

Apollo may not have the final word in the Tech Data acquisition, however. Tech Data, in a filing with the Securities and Exchange Commission, said it has the right to solicit or encourage “an alternative acquisition proposal.” That so-called “go shop” provision expires December 9.

“Institutions clearly believe there will be a higher bidder than Apollo,” said Marty Wolf, president of martinwolf, a merger and acquisition advisory firm based in Scottsdale, Ariz. “There have been large blocks traded above [the] purchase price” of around $130 per share.

Tech Data’s current valuation of 7x 12-training-months EBITDA “is historically not very high,” he added.

If Apollo’s bid prevails, the Tech Data acquisition would add IT distribution to the investor’s technology holdings. Apollo has some history in managed services. In 2016, Apollo in 2016 acquired Rackspace, a managed cloud services company based in San Antonio, in a $4.3 billion deal. Apollo has also invested in Presidio, an MSP and consulting firm based in New York.

November 5, 2019  9:34 PM

SADA’s dotMaps app rolls out in Seattle

John Moore John Moore Profile: John Moore
Channel, Cloud Computing, Google Maps, IT Consulting, Project planning, Public sector, smart city

An application development assignment that began as a municipal project coordination system has morphed into a public-facing service aiming to help travelers plan their routes to work and school.

The Seattle Department of Transportation (SDOT) selected SADA Systems, a technology and business consulting firm based in Los Angeles, to build what was initially conceived as a tool for planning and sequencing future public works projects. That effort, however, has since expanded and the latest component, dubbed dotMaps, went live Nov. 4. The dotMaps application, which is built on Google Maps and Google Cloud Platform, shows city residents the effects of construction projects on streets and sidewalks.

Users accessing dotMaps can draw a boundary around areas of interest and receive email notifications regarding construction and other events that may affect travel, according to SDOT.

Project background

Heather Marx, director of downtown mobility at SDOT, said her department selected SADA for the coordination tool project through a competitive procurement process.

SADA’s offering, Marx said, was “far and away the most easy to use with the simplest and most appealing interface. They also offered all of the things we were looking for in terms of coordination ability.”

Full deployed in August 2017, the project coordination and sequencing system application’s role has expanded over time. SDOT now uses it for scheduling work on projects that are happening at the moment, in addition to coordinating projects yet to break ground. The current phase is the dotMaps rollout. SADA worked with SDOT and the Chicago Department of Transportation on this public-facing element, according to Marx. Such shared technology initiatives help local governments save money.

Indeed, cost reduction has been a strength of the core project coordination system, in which any organization planning to work in the right of way — a strip of land reserved for public transportation — must enter their project data. The savings across participating agencies, public utilities, for example, paid for the project in a matter of months.

“Between August and end of year [2017], we had made back the annual subscription fee,” Marx said. SADA’s cloud system is billed on a subscription basis.

The savings stem, in part, from the ability to coordinate “shared trenching,” Marx noted. This lets the city open the ground once for more than one project, which minimizes construction time in the right of way. It also means the road is repaved once after construction ends, rather than after each time a utility launches a dig.

New uses

Marx said SDOT continues to uncover new uses for SADA’s map-based application. The department is currently working to include planning areas that the city studies prior to a project. SDOT plans to add detours and truck haul routes to the map as well.

SDOT also aims to share road closure information via its API with map providers such as Apple Maps, Google Maps and Waze, Marx said.

October 31, 2019  9:09 PM

DoD JEDI contract: Following old plot lines?

John Moore John Moore Profile: John Moore
Channel, Cloud Computing, Contracting, Government IT, IT procurement

The Defense Department’s $10 billion JEDI cloud services contract is a new story with an old plot.

The Pentagon awarded the frequently delayed deal to Microsoft on Oct. 25.  The DoD Jedi contract — with its big price tag, high-profile technology and contentious nature — recalls a much earlier coveted and controversial government IT contract. The DoD awarded its AFCAC 251 program, once the center of attention in federal IT circles, way back in 1988. AT&T captured the deal.

Consider the parallels between the two contracts. AFCAC 251’s projected value, though not of a JEDI magnitude, was impressive. Industry pundits lauded the contract as among the largest federal IT deals of all time, with a potential value of nearly $1 billion. An emerging technology angle was also present: Unix-based minicomputers, and the deal was seen as an important endorsement of that operating system. Coincidentally, the DoD awarded AFCAC 251, like the JEDI contact, on a Friday in late October. I remember, because I was waiting for the DoD to fax the announcement that Friday afternoon and my editors were rather impatiently waiting for me to file the story.

AFCAC 251 never lived up to its potential, however. The long procurement cycle and additional delays due to post-award contract protests meant the technology was at least 18 months out of date when the contract was finally opened for ordering. AT&T had bid its line of 3B2 Unix minicomputers. But when orders for those machines finally arrived, the general consensus at the time was the deal never got close to the $1 billion ceiling.

AFCAC 251 wasn’t the only federal IT megacontract that didn’t quite live up to its billing. A string of similar deals exposed the government’s cumbersome IT acquisition process and an inability to deliver up-to-date technology. The less-than-stellar contracting practices led to federal procurement reform in the 1990s. The upshot: agency buyers would eventually be able to purchase PCs and other hardware via credit card, using vehicles such as the General Services Administration Schedule 70 contract.

Against that backdrop, the DoD JEDI contract seems like a step back to the megacontract era. It’s far too early to determine whether the contract will reach the $10 billion milestone or fall short. In the meantime, it’s important to note that JEDI is an indefinite delivery/indefinite quantity (IDIQ) contract, as was AFCAC 251. An IDIQ contract gives the winning vendor the ability to sell products or services, but provides no assurance customers will actually hit the contract’s spending ceiling. The Pentagon guarantees $1 million for JEDI’s two-year base contract period, and anticipates an estimated $210 million in spending during that period. The contract could run up to 10 years, if DoD exercises all of its options.

Another consideration: JEDI isn’t the only cloud pact in town. Microsoft faces other cloud services competitors for the government’s dollar. And that competition seems likely to increase.Cloud formation

“The Department continues to assess and pursue various cloud contracting opportunities to diversify the capabilities of the DoD Enterprise Cloud Environment,” according to a Pentagon statement. “Additional contracting opportunities are anticipated.”

Add to all this the potential for a contract protest from AWS, and there’s more than a little uncertainly around JEDI. We’ll know in a few years whether the DoD JEDI contract follows the megacontract script or creates a new narrative.

October 25, 2019  8:31 PM

Teridion SD-WAN expands to China, sparking channel business

Spencer Smith Spencer Smith Profile: Spencer Smith
Channel partners, China, Networking, SD-WAN

Teridion, an internet routing platform provider, has extended its global SD-WAN offering to mainland China, filling a gap for partners that target multinational customers.

Enterprise customers today typically rely on MPLS technologies to connect with their offices located behind the Great Firewall of China, the country’s system for controlling and blocking censored content. The MPLS approach usually results in exorbitant costs and poor network performance standards, a source of pain for partners and their multinational customers alike. Teridion, through its expanded SD-WAN offering, is aiming to give organizations a way to deploy and manage their China-based locations as they would offices outside the Great Firewall.

“Up until this point, partners have had to walk away from this [China-based] business and introduce competition into their customer base, and had to forfeit that SD-WAN business to local, in-country MPLS,” said Kevin Moynahan, director of channel sales at Teridion, headquartered in San Francisco.

North Palm Beach, Fla.-based IT consulting firm 26Connect is one of those Teridion partners that struggled with the limitations of providing SD-WAN to customer sites in China. 26Connect focuses on clients in the manufacturing vertical, where many organizations have ties to the Middle East and Asia-Pacific.

“I told [Teridion] I don’t think there is a whole lot for us to do if they don’t have this [mainland China extension] in place,” said Sean Dublin, president of business development at 26Connect.

Dublin said the Teridion SD-WAN in China offering will have an enormous impact on his company. “What Teridion has done here is very unique in that they are providing a proven technology to a very difficult place to connect, at a price point that feels like it’s priced in the domestic United States.”

“If the [network] user experience isn’t the same in Guangzhou as it is in San Francisco, we can fix that now,” Dublin added.

Peijman Roshan, vice president of products and marketing at Teridion, said developing the SD-WAN offering in China involved meeting China’s regulatory framework and bypassing performance issues created by the Great Firewall.

Companies must work with one of three of China’s official service providers: China Mobile, China Telecom or China Unicom. Teridion opted to work with the three providers to obtain multiple connections and then layered its cloud architecture on top of the connections, Roshan said. Teridion uses Chinese public cloud providers such as Alibaba Cloud and Tencent.

“With what we are doing in China … [we] have multiple connections that [we] can use, and [we] have layered our cloud architecture over the top of it, so [we] can orchestrate our cloud routers dynamically and on the fly. [We] don’t have to do a connection per customer,” Roshan said.

Teridion’s SD-WAN offering integrates with WAN, SD-WAN and security edge technologies from providers such as Cisco Meraki, Fortinet, Citrix and Palo Alto Networks. Additionally, the offering supports connectivity to legacy branch office routers and firewalls, Teridion said.

China’s regulatory and technical requirements are “an issue that plagues SD-WAN in general. … There is a tremendous amount of pent-up demand for” offerings like Teridion has introduced, Roshan added.

October 11, 2019  6:35 PM

MSPWorld 2019: Five things I learned at the conference

John Moore John Moore Profile: John Moore
IT Managed Service, IT services, MSP, MSPAlliance

Here are several observations from MSPAlliance’s MSPWorld 2019 conference, which wraps up today in Las Vegas.

1. The industry wants to reframe the MSPs-as-target discussion

MSPAlliance leadership is aiming to turn the negative publicity surrounding managed service provider security incidents into an opportunity for proactive MSPs to differentiate themselves from cybersecurity laggards. Watch for more developments here as MSPAlliance works toward an early-warning capability that could help MSP community members keep each other posted on cyberattacks and vulnerabilities within tools such as remote monitoring and management (RMM) software.

2. MSPs aren’t thrilled with integrated tool suites

Major MSP platform vendors, backed by a handful of private equity companies, have been creating integrated tool suites spanning RMM, professional services automation, backup and security. But service provider executives speaking at MSPWorld 2019 aren’t sold on the approach. “We are clearly best of breed,” said Karl Springer, president of Sagiss, an MSP in the Dallas/Fort Worth area. “You show me your product is the best product out there, and we are going to incorporate it into our toolset.” Sagiss uses the core products of ConnectWise and Kaseya.

“We are going to look for the best solution,” noted John Burgess, president of Mainstream Technologies, an MSP based in Little Rock, Ark. He said Mainstream can create custom integrations to make a product work within its toolset.

Robin Chow, president and founder of XBASE Technologies Corp., an MSP based in Toronto, also voiced a preference for best-of-breed products, citing security as a factor among other considerations. He questioned whether vendors fully examine the security of newly acquired tools as they expand their MSP portfolios.

“They buy it, and they want to bolt it on and bring it to market as quickly as possible,” Chow said. “I’m not sure it’s vetted out.”

3. When it comes to pricing, MSPs can have it both ways

‘All you can eat’ has been a popular pricing model among MSPs. But without rigorous scoping, customers can take advantage of the approach — requesting home visits to set up networks, for example. In addition, some customers require more support if they have numerous on-premises applications or dodgy servers that require frequent repairs.

Springer recommends a hybrid model, which his company has been using for several years. In this approach, the MSP charges a flat per-device/per-month fee for proactive services such as monitoring and backup. Other services are billed on a time-and-materials basis. The latter category could include project work or a workstation setup for a new user. Springer said customers purchase blocks of time that they can apply toward services beyond the scope of the monthly subscription fee.

4. Blackouts have some MSPs worried

Some West Coast service providers at MSPWorld 2019 pointed to intentional blackouts in California as a concern, citing the potential for multiple disaster recovery events. The blackouts have been put into effect to reduce fire risk.

5. MSPs continue to be acquisition targets

During a panel discussion on mergers and acquisitions, the audience was asked whether they had received email inquiries regarding selling their companies. Nearly every hand went up. Panelists were in agreement that consolidation will continue and could even accelerate.

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