The Rise of the VAR/MSP
The Managed Service Provider (MSP) market is exploding. It’s been this way for a few years now. It makes a ton of sense – MSPs can offer something organizations are lacking and for a lower cost: expertise in 24/7 operation of critical infrastructure.
Some, usually larger, enterprises are unable to use MSPs today due to security and confidentiality requirements. However, many who can, choose to use MSPs to run their infrastructure. We, at indeni, are happy to see this trend as MSPs are a great partner of ours. Take Fujitsu, for example, a leading MSP in the UK & Ireland who has converted their MSP offering to run around indeni’s technology.
One thing that we started seeing more and more in 2014 and now 2015, is the rise of the VAR/MSP. Value Added Resellers (VARs) are those who sell network equipment and professional services to large enterprises. Historically, their business was primarily around making a low margin on physical equipment sale (and maintenance) and a higher margin on professional services (design and implementation of projects).
However, much like startups and more established tech vendors have figured out, a recurring revenue stream can greatly increase the business’s profitability. Almost all such vendors today use (or are moving to) annual subscriptions to provide services instead of selling perpetual licenses. It provides them with an ability to forecast future revenues, increase margins and build a solid business.
VARs are now going the same way. They are leveraging their expertise (built through reselling equipment and providing professional services around it) to build strong MSP offerings. Several of our VARs have already begun offering this and many others are in the planning/building process. We’re very happy about this development – as indeni is becoming a core element of delivering these services. Our pricing model aligns with that very well too, so MSPs have considerable flexibility in rolling out indeni across their existing and new customers.
These are exciting times!