And you’re right-on. More thoughts on each of your points…

1. Managed VoIP such as video surveillance: Yes, that’s an emerging opportunity for readers. Read more here.
2. HIPAA and Sarbanes: Yes, a few readers have reminded me that compliance isn’t a US-only issue. Europe, Australia and other regions have their own sets of mandates to adhere to. We’ll keep this “international” perspective in mind as we plan future coverage.
3. Kiosks: Yes, these all need to be managed remotely. I’d add digital signage to that conversation as well.
4. Other emerging managed services: Check out our managed services hype cycle for a list of emerging opportunities.

Thanks again for your time, Brian.

Your points above are right on:
1. PCI is driving a lot of MSP conversations.
2. An MSP ecosystem is maturing rapidly. Assuming there are about 100,000 VARs in North America, and 10 percent move to managed services, that’s 10,000 eager VARs who need more info. Plus, web hosts and large service providers — especially in telecom — are moving in, too. Our traffic on MSPmentor suggests that the 10,000 number is very, very conservative.

Thanks for inviting me to meet you in Framingham. And keep the feedback coming.

It was a pleasure meeting you at the MSPA Event earlier this week.

I do agree with the comment about this segment maturing. Living on the vendor side (AlliedSignal, Honeywell, Philips and most recently at SonicWALL) for the past twenty five years and tryin to serve solution providers, and now sort of running a hybrid organization (part vendor due to our marketing & sales automation platform that you have talked about in this blog, and part solution provider, as we provide our services through partners only now), it seems to me now that this MSP segment has truly started to take off.

Vendors are being more receptive to the needs of the solution provider’s business model to build recurring revenue centric products and services, and solution providers are figuring out how to bundle those and create solutions that are meaningful for end-customers. We have now seen the evolution of several partners, who are vertically centered and selling highly differentiated managed solutions – like using PCI as a drive to provide remote managed firewalls or securities for POS devices in retail. This is truly exciting.

Thanks to the persistence of MSPA, your organization and others who are supporting this ecosystem, the awareness level among solution providers are now quite high about the need to transition (or at least incorporate a significant piece) around a managed services recurring revenue business model.

I have been reading your blog for a while, and it was great to hear your vision earlier this week to see how you are planning to enable solution providers to be more successful by leveraging your knowledge base and virtual community that you are building.

Great job – keep it up, and let us know if we can help anyway.

Regards,

Sugata

This so-called “race to the bottom” is something MSPmentor has covered closely, and Level Platforms CEO Peter Sandiford offered some thoughts as well on that topic.

It remains a timely topic, especially as MSPs battle the economy, and in some cases — each other.

On the MSP Alliance Accreditation front, I don’t have direct knowledge about the program’s momentum, but I think Charles Weaver at MSPA has indicated roughly 100 MSPs are now accredited.

Dan Wilson, president of Waypoint Solutions Group, mentioned to me that his MSPA Accreditation and his ranking on the MSPmentor 100 helped him to win three customer engagements recently.

MSPA has poked some fun at the MSPmentor 100, both publicly and online — but I’ll continue to take the high road. While our list is an annual high-level look at an MSP’s growth rate, revenue per employee, etc., the Accreditation program sounds like it carefully scrutinizes the financial health, viability and professionalism of an MSP. But then again, I don’t want to speak for the MSPA — so readers should check in directly with the MSPAlliance for more info on Accreditation.

Your point about MSPs becoming more sophisticated is something I heard as well during a chat with Nimsoft. The early MSPs have moved far beyond remotely administering Wintel desktops. Some of them resemble “mini EDSes” in my mind — sophisticated small businesses that have feet on the street for complex IT projects, and 24×7 NOCs to monitor customer settings.

Again, good to hear from you Lane. Congrats on your MSPA Accreditation, and Do IT Smarter’s “Master MSP” approach. I look forward to speaking soon.

I would suggest everyone with a less than stellar website to take a look at the ZINFI product, this too has an online storefront as you mentioned on topic 1.

There are a few other topics that I felt resonated with me. 1st was our “race to the top”. With all this concern about the recession and a “race to the bottom” in pricing, all of us need to move to the top, as the trusted advisor for our customers.

This will enable us to remove the pricing converstaion from our meetings and in fact remove much of the sales cycle. Once you are no longer in the “I am here to sell you something” position and move to the advisor / “part of the company” position, you are now in a pro-active relationship with the customer and are looking to the future to ensure that their IT remains stable and secure. You will find that pricing is not an issue at this point and these services are no longer “shopped around”.

Another topic of interest was the Managed Services Accreditation program. I personally did a presentation on this and found a lot of interest from the attendees. Greg Donovan, in Tuesdays Keynote, encouraged everyone to consider taking this accreditation.

This program was put together to encourage a set of standards for MSP’s to build their business around. This can be especially critical for a younger MSP that is just developing their practice and is looking for guidance. The program looks at not only MSP best practices but ensures that you are covered from a legal perspective in your contracts and business insurance levels. Your finances are also looked and and guidance can be given in this area as well.

Ultimately I think that both young and established MSP’s will benefit greatly from this program as it will set the standard for the Managed Services industry.

Finally I have to say that it was exciting to see so many companies that are moving beyond their initial MSP offerings (getting their toes wet) and embracing the model as their core business. I spoke with one company that had completely moved to a MSP model, even though it meant dropping 75% of their customers. They now have a core set of customers (greater than 50) on managed services contracts. This is resulting in much higher margins for them and allowing them to grow much more quickly with a higher quality of life.

Lane Smith
President
Do IT Smarter