Jockeying for Position in Managed Services

By Pedro Pereira  |  Posted 2007-10-03 Email Print this article Print
 
 
 
 
 
 
 

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Opinion: Dell's acquisition of managed-services vendor SilverBack is already having an effect.

The new partnership between Level Platforms and Do IT Smarter is one of the most significant recent strategic developments in the managed services market space.

It is, in fact, second only to the acquisition of managed services platform vendor SilverBack Technologies, Billerica, Mass., by Dell, Round Rock, Texas.

Arguably, without Dell's SilverBack acquisition, the partnership between Level Platforms and Do IT Smarter would not have happened. Level Platforms and Do IT Smarter reportedly were already talking, but the acquisition most likely accelerated their coming together.

Dell, despite its plans to launch an official channel program shortly, remains an object of suspicion in the channel because of its history as a direct-selling vendor that in the past actively urged customers to "cut out the middleman."

Though Dell has said it plans to use the SilverBack platform for both direct relationships and channel partnerships, some fear Dell's real intent is to cut the managed services provider, or channel partner, out of the picture.

It's a fear that Dell, if its channel intentions are true, will have to allay through its actions.

Do It Smarter's partnership with Level Platforms is nothing less than a first step toward a potential parting of ways with SilverBack. Do IT Smarter President Lane Smith in July said the company would reconsider its SilverBack relationship if Dell's acquisition turned out badly for partners. Ultimately, that may not happen, but Do IT Smarter obviously is taking no chances.

Do IT Smarter went into business as an MSP but the company has made the transition to "master MSP," positioning itself between vendors and MSPs as a new type of distributor. Though it does not carry hardware, the company has become a competitor to distributor Ingram Micro, which has worked hard in the past year to build a palette of managed-services offerings.

At the center of Ingram Micro's offerings is its partnership with Level Platforms. Ingram Micro has signaled no intention of adding other platform vendors, but that might change as Level Platforms and Do IT Smarter build their relationship.

For its part, Level Platforms, Ottawa, reinforced its position as the managed services platform vendor with the most traction in the IT channel. With its open-architecture approach and ties to Microsoft, Level Platforms has outpaced competitors in signing up channel partners.

The vendor now has some 2,500 partners, about 1,200 more than its second-closest rival, N-able Technologies, also of Ottawa.

Of course, the number of partners tells only part of the story. How much business each partner generates would be more telling. Level Platforms has made recruiting large numbers a big part of its strategy, while, interestingly enough, SilverBack's approach has been to boost its share of business as possible through each of its considerably smaller number of partners.

The expense involved in partnering with SilverBack created the impetus for the evolution of Do IT Smarter to what it has become. Do IT Smarter made it possible for small VARs and integrators that wanted to become MSPs, but couldn't afford paying $35,000 upfront, to use SilverBack's technology through monthly fees starting around $100.

Now SilverBack has been absorbed by a company that arguably has done more to lower the price of technology than any other, while Do IT Smarter has turned to a platform provider that has charged among the lowest, if not the lowest, monthly fees to its channel partners.

So now the stage is set for further developments that ultimately will shape the managed-services market. As was the case with PCs, Dell may end up having a lot to do with how it all plays out. Already, it has changed the dynamics of the rivalry between Do IT Smarter and Ingram Micro, while making it possible for Level Platforms to further entrench itself in the channel.

Pedro Pereira is editor of eWEEK Strategic Partner and a contributing editor for The Channel Insider. He can be reached at pedro.pereira@ziffdavisenterprise.com.

 
 
 
 
 
 
 
 
 
























 
 
 
 
 
 

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