Custom infrastructure environments built to customer specifications, are among the most profitable services MSPs can offer. However, the complexity and personalization make it hard to scale these services. Cloud-based services are changing the game.
Complex Hosting, offering custom built infrastructure environments on customer specifications, is among the most profitable services for many MSPs. customers expect to pay extra for the advisory work with your architects and custom deployment and administration of your systems administrators. Also, due to custom work, customers usually sign minimum contracts and changes require new quote. However, these characteristics are also why is it so hard for your complex hosting service to scale.
The effort to buy fiddly requires qualified personnel to engage with customers often several rounds of specification and proposal. System administrators spend time validates design and implementation and therefore must provide adequate supervision and management. Sourcing, custom configuration and hardware implementation and software stack requires additional time and effort. To offset the cost of hiring and developing people with these skills, your offer must be consistent, and this requires more citations and pushing the decision up to the Executive level at your customer. So while the deals are profitable, they take time and effort to develop, and the market is limited. The result is that scale your business remains difficult.
Expensive infrastructures are the problem much cloud computing is designed to address, and when it debuted many proclaimed the end of MSPs. It is understandable then, MSPs that many tend to see the cloud as competitive. After all, if anyone can deploy a virtual machine on a large cloud services provider with an API call, there should be no need to MSPs, right? Fortunately, nothing could be further from the truth. Building scalable, reliable services in the cloud still requires considerable skill, most companies, though, system administrators and experienced expert. The skill differential is your sales opportunities. So fundamental skills of MSPs in design and operation are still valuable in the cloud.
However, there is more opportunity for MSPs, because the cloud isn't just a business model. Rather, there is a new technology being developed. The goal of this technology is to make data center resources consumption without access to the data center. The infrastructure itself; Servers, switches, storage and more were never developed with that in mind. However, using remote data center resources, not limited to end-user organization. If implemented correctly this new technology may allow MSPs to remove the complexity inherent in complex hosting, expand their services and enter new markets.
For example, MSPs can use cloud to accelerate the sales cycle. Our MSP partners have successfully exploited the cloud to work faster. Infrastructure can be set up, knocked down and changed so rapidly in the cloud actually they can engage in real-time collaboration clients. More specifically, our cloud platform provides infrastructure AppLogic CA visual drag-and-drop. Solution architects and system administrators often use the view to create and manage customer infrastructure. Customers can more easily understand what is proposed because of the Visual display. As a result, the typical cycle of specification and quote can be reduced or even eliminated.
In fact, some MSPs are now building experts and centres providing service through online meetings to further accelerate the process. While some customers are not ready to accept a session online, many are because cloud infrastructure can be changed easily and therefore do not have the risk of lock-in associated with traditional distribution. Using visual infrastructure allows you to build the infrastructure and refining iteratively with little or no cost for changes.
As system administrators manage customer infrastructure will change as well. Rather than work in a data center can work from anywhere they have internet access. This mobility creates new opportunities for your business. Your team can manage infrastructure from part of the customer, together again. Also, if your clients need resources abroad, your team can run them from your Office. Thus, the total cost of infrastructure management is reduced. You can catch this as margin, or use it to lower the offer the customer to acquire more customers.
Accelerating the sales cycle and online infrastructure management when using cloud significantly reduces the total cost of sale. Reduce costs, though, is yet another enabler. The opening paragraph I said that the cost of limited market complex hosting. Reducing costs, cloud computing open new markets for you.
The disruption happening in managed hosting services and is not without its risks. Cloud services can be portable, reducing or eliminating the customer lock-in. MSPs must work more closely with clients to ensure customer satisfaction and success. In a previous blog MSP mentor I also noticed how measurement data can be used to identify customers whose use has been reduced and may need further attention.
Cloud computing is disrupting the hosting and managed services market. However, this disturbance will bring new customers and new opportunities for MSPs aggressive and innovative.
If you have not already done so, should investigate MSPs by adding or expanding their complex hosting services using cloud technology.
Bert Armijo is VP of product marketing for AppLogic CA. An industry expert and frequent speaker on cloud computing and has a track record of doing years of bringing new technologies to market.
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