Aiming to significantly change how managed services are delivered and consumed, Oracle on Sept. 19 launched a turnkey cloud platform specifically designed for managed service providers looking to transform their business models.
Instead of building their own data centers and then billing customers for each individual service, the Oracle Cloud Managed Service Provider Program combines the company’s infrastructure-as-a-service (IaaS) and platform-as-a-service (PaaS) into a set of offerings optimized for specific types of IT deployment services, said Sanjay Sinha, vice president of platform products for Oracle.
For example, partners would then be able to deploy an end-to-end turnkey managed service for DevOps that right off the bat would be 30 percent less expensive to deliver than anything a managed service provider (MSP) could construct on its own, Sinha said.
“Not that many MSPs have an appetite for capex,” said Sinha. “In this program, we handle everything on the backend, including the billing.”
While Oracle didn’t have much of a presence in the MSP community, the company saw an opportunity to launch this program because customers are demanding multi-year contracts based on specific business outcomes, he said.
The first solution providers to join the Oracle Cloud Managed Service Provider Program include Accenture, Atos, Capgemini, Cognizant Technology Solutions, Deloitte Consulting, Dimension Data, Fujitsu, Hitachi Consulting, Infosys, PwC, Tata Consultancy Services, Tech Mahindra and Wipro.
Accenture intends to provide managed services based on the Oracle cloud platforms that play to where it adds value, said Patrick Sullivan, managing partner and Oracle global technology lead at Accenture.
“Our intent is to take our services and the Oracle services and wrap them around one pricing model,” said Sullivan. “For us, helping businesses build out things such as DevOps is the real differentiator.”
Naturally, the rate and the degree to which that transformation of the MSP business model will play out across the channel remains to be seen. Outcome-based pricing models are stll in their infancy.
However, IT organizations are now becoming a lot savvier about how to procure cloud services, Sullivan said. That, in turn, is putting pressure on MSPs to add value beyond the cost of simply delivering an IaaS or PaaS service, he added.
Regardless of how MSP business models change in the months and years ahead, the days of pricing out every little service delivered separately may finally to be coming to a close.
Mike Vizard has covered IT for more than 25 years, and has edited or contributed to a number of tech publications, including InfoWorld, CRN and eWEEK. He currently blogs daily for IT Business Edge and contributes to CIOinsight, Channel Insider and Baseline.