Although managed services have been on the top of everyone’s mind in the channel for the better part of three years or more, it’s pretty amazing to see how still relatively rudimentary most managed service plays in the channel are.
In practice, a lot of solution providers are still testing the waters by opting to resell services from companies such as N-able or SilverBack that essentially provide them alerts when things go wrong with the customer’s IT equipment. A fair number of others have gone a step further by building a more sophisticated set of services based on a turnkey NOC (network operations center) approach pioneered by Level Platforms, or by creating a custom NOC based on software from companies such as Kaseya.
More recently, we’ve seen the arrival of a complete software-as-a-service approach to providing managed services in the form of Klir Technologies, which has a unique-go-to-market strategy in that it will only make its service available through distributors such as GE Access because it prefers not to manage relationships with solution providers itself.
Whether you prefer Klir, Level Platforms or Kaseya depends upon how they fit into your business model, but what is clear is that the next generation of systems and network management is upon us in the channel. And what’s most striking about that is that some of the better-known companies in the systems management space continue to just plain miss the boat.
To be sure, IBM, Hewlett-Packard, CA, Cisco and Opsware all have limited efforts underway to entice managed service providers to use their software, but the vast majority of their efforts are targeted at large telecommunication providers that are delivering managed services in competition with traditional solution providers.
The reason for this has very little to do with any grand conspiracy against solution providers but rather everything to do with the complexity of the system management products offered by those vendors. In short, their products still require eight people in lab coats to implement rather than being something that the average human IT person can run.
This is one of the reasons that HP recently lost out on an opportunity to provide the systems and network software that Avaya is using to support the World Cup. That deal, instead, went to Klir because its software was relatively easy to deploy and didn’t require an army of support people to run.
Worse yet for the incumbents is the lost opportunity that managed services would have provided them in the form of pulling additional products, such as WebSphere, to untold number of customers that could have been using one of their system and network management products.
Given that need to pull products through the channel, it shouldn’t be all that surprising to see companies like IBM, HP, Cisco and CA begin to acquire relative upstarts such as Klir, Level One and Kaseya. But in the short term, it just goes to show how out of touch channel executives can be when it comes to identifying and acting upon obvious emerging trends in the channel.
Meanwhile, the race in the managed services space will continue to go to the fleet of foot that are already embracing the next generation of managed services. With an unprecedented view and knowledge of their customers’ IT operations, these solution providers can move to sell customers solutions even before they know they need them. And what that means is that new products are sold into those accounts long before rival solution providers even know there is a requirement or opportunity.
And that ultimately, is the real end game. Managed services in and of themselves may be profitable, but their real value is the command and control they give solution providers over their customer accounts. And that control not only brings recurring revenues but a promise of guaranteed business longevity that until now has eluded most solution providers.
Michael Vizard is editorial director of Ziff Davis Media’s Enterprise Technology group. He can be reached at firstname.lastname@example.org.