Cloud Fueling SMB Growth for VARs
The cloud is hot, for sure, but what’s the SMB opportunity? A new report from AMI Research shows that remote managed IT services for small to medium size businesses is set to grow rapidly in North America over the next five years. Inside, we take a deeper look at how the SMB MSP market is, and will be, affecting the channel.
Overall Growth
Increasing demand for remote managed IT services (RMITS) by SMBs is being met with an increasing supply. The market is one of the few continuing to grow in the economic downturn. AMI Research predicts the market will grow 3.3 times over in the next five years, representing a CAGR of 28% year over year.
Adding Managed Services =Growth
VARs who want to add Managed Services are faced with a tremendous growth opportunity because of the market’s early stage, according the AMI-Partners. The research shows only a tiny fraction of North America’s install base of 60 million PCs and 8 million servers in North America is managed remotely today.
Local VARs Take Advantage
Local channel partners are jumping on the RMITS bandwagon. Some are delivering services using their own data centers, but many are relying on external clouds and remote management software to reduce the barrier to entry. The result, says AMI, is improved productivity and improved customer service levels which leads to more business.
Switch-Up Headcount $
AMI advises channel partners to free up headcount dollars and shift focus from technical staff to broadening their sales and marketing organizations for acquiring and managing the growth in customer relationships.
Where’s My Piece?
The cloud craze attracts new players looking to take advantage of potential market growth. AMI says non-traditional SMB service providers will enter the space and include a wide array of organizations like telcos, IT vendors, distributors, retailers and online resellers.
New Players: Align and Capitalize
AMI advises new providers to align rather than challenge channel partners, who, it believes, will continue to play a critical role in servicing the SMB RMITS marketplace. The firm suggests new players capitalize on channel partners close SMB relationships by forging relationships and tapping their expertise.
Cost cuts driving RMITS
"The severe economic conditions of the last one year have forced SMBs to look for more cost effective ways to manage their IT. Remote managed services offered by 3rd parties provide 24/7 availability of critical IT infrastructure without increasing the need for internal IT staff," according to Anil Miglani, SVP of IT Infrastructure and Managed Services at AMI.
Key MSP Applications
The SMB RMITS industry is still in its early stages –some SMBs use remote IT services piecemeal for security and storage, while others are now extending the use of remote services to manage PCs, servers, networks, communications equipment & devices, etc.