In the 2 years leading up to my departure from the IT Service space it seemed that customers of that size were more interested in buying something direct at rock bottom prices, then paying you to put it in. It’s a shift in SMB consumer mentality in my opinion and a far bigger threat than any local competitor ever was.

It would be really interesting if MSP Mentor found a way to pull some direct feedback into topics like this to see what the “average joe” SMB business owner and manager thinks.

Andy Myers
Fractional CIO, Consultant
http://www.andymyers.net

In 2006 we built out full Exchange/SharePoint hosting platform using Microsoft’s HMC provisioning technology. It was great until we realized that the hardware refresh and operational costs would simply increase over time and squeeze the margins. Then guess what? Microsoft, Intermedia, GroupSpark, and others said hey, you can just resell this like any other product and focus all the extra energy from managing your platform back to Clients. Guess what we did?

Remember a Managed SERVICE PROVIDER needs to focus on delivering great services to clients, not running a platform to deliver products. Simply no way to compete as this is hugely capital intensive business with decreasing margins.

Edward Stringfellow
http://www.stringfellow.com

@Kevin is right. Hosting your own is a big endeavor. Truly a whole other business. Not to mention BPOS is super cheap and includes the Sign In Client which is STILL unmatched in the hosting world.

The fact that Google Docs is now allowing “any file type” to be uploaded (per Google Partner Feb newsletter) and offering dirt cheap add on storage means further eroded market share. I think a whole TB is only $300 and change PER YEAR.

Posts like this have me always contemplating… is VAR coming to and end in the SMB world?

Andy Myers
Fractional CIO, Consultant
http://www.andymyers.net

Unless you are a dev shop [or ISV] with your own plug-in or derivation, you will find hosting this product frustrating. If, however, you can find a way to add significant value and generate market demand for this value, there may be a model that makes sense. Then again, with so many others hosting the product already, you’d be well advised to leverage another providers platform and focus your resources on the software.

ABP is the easy choice for Government or Private Sector Entities to quickly place any collaboration tools into production without the headache and overhead.

ABP won several awards in 2009 with this strategy. BEST OF CALIFORNIA 2009 AND BEST WEB SOLUTION “GTC 2009″.

There is a third option. Instead of being a me-too player, service providers can opt to carve out a niche and go non-MS, i.e. targeting SMBs. While we have proof that business email, mobile collaboration, SharePoint intranets are becoming standard for knowledge worker environments – Small Businesses don’t have the internal expertise and budgets to set these environments up and they are typically too robust which makes them difficult to use. I submit that service providers should look at reselling applications that target the fastest growing segment – small businesses with applications that are slimmer and better suited to small businesses (<100 ee). Google Apps fits this profile and of course my company, HyperOffice is opening up our reseller program with some very interesting developments around mobile collaboration.