25 Predictions To Profit By In 2007

HARDWARE
1 PC Pricing, Margins Stabilize.
Vista is under attack for security holes and tardiness to market, but it will provide much-needed relief to PC makers and system builders that have been squeezed since pre-Y2K. The new OS from Microsoft demands higher-performing processors and a lot more memory -- meaning solution providers can either see sturdier hardware margins or, if customers don't upgrade to Vista right away, the opportunity to sell other efficiency-boosting solutions to keep those customers competitive.

2 Wide Eyes For Wide-Screens.
The market will continue to say goodbye to square-screen LCD displays, and hello to wide-screens (all the better for efficiency and, say, watching movies.) Solution providers will find that even customers who don't upgrade PCs will be inclined to upgrade monitors -- once they're convinced employees will be able to get more work done if they can open up more programs at once.

3 A Big Stink Over Ink.
Printer, copier and MFP manufacturers have long looked at the sale of consumables (i.e. ink cartridges) as a license to print money. But as hardware margins have eroded over the last few years, a growing number of solution providers have gone to third-party cartridge makers in an effort to stay competitive and still make money. 2007 will be the year vendors like HP, Xerox, Lexmark and others must finally deal aggressively with price competition from blank-label ink suppliers -- and in the process give new incentives to the channel to stick with branded ink.

4 Trouble In Round Rock.
It's not enough that Dell lost a lot of market share during 2006, or that its margins and profit declined, or that it had to recall 4.1 million notebook batteries due to explosion hazards -- the company ended 2006 under investigation, under scrutiny and under pressure. As the market adapts to a Dell in significant decline, solution providers will be able to do what they've always done best: show the customer they are better served in the long haul by a trusted local IT advisor than a direct PC vendor.

NEXT: Predictions in managed services, networking, security, storage and software

MANAGED SERVICES
5 In Security, Get Physical.
You're already remotely monitoring computers, so now add surveillance cameras, remote access controls, room temperature monitoring, intruder alarms and other IP-based physical security devices. This gear has a hot market, and adding a physical security layer to your MSP business is a relatively easy, and highly profitable, way to make money while delivering a valuable service to customers.

6 Make Your Vendors Pay You.
MSP platform vendors are not advertising this, but they are all in the market to buy new tricks MSPs have developed when running their products. You don't have to give up your trade secrets, but if you've perfected a custom report, made a custom connection, or crafted sharper code, your MSP platform vendor has a check with your name on it.

7 Snag Telecom Commissions.
Becoming a carrier sub-agent is an easily overlooked opportunity that can quickly add residual commissions to your bottom line. Master agents for traditional voice carriers such as Verizon and AT&T, as well as next generation IP voice and data carriers, will pay commission on simple referrals then do the heavy lifting. If you decide to grow your expertise here, a managed voice/data service can be yours.

8 Soho Will Be Soooo-Hot.
The number of telecommuting workers will explode in 2007 as companies realize the savings in it. MSPs who approach their customers early with practical ideas about how to deploy secure remote soho offices with central network support will see hardware, software, and services dollars roll in.

NEXT: Predictions in networking, security, storage and software

NETWORKING
9 Video On The Rise.
Whether it's in-house on-demand training sessions, high-definition videoconferencing, IP surveillance or the mounting popularity of recreational video from Websites ranging from YouTube to CNN, the amount of video traffic running over corporate networks is expected to grow in 2007. For solution providers, that means WAN optimization and application acceleration technologies that provide quality of service, traffic prioritization and bandwidth management should play key roles in networking solutions.

10 Collaboration Is King. Now that IP telephony has gained mainstream acceptance, solution providers that show customers how to do more with the technology will be well-positioned for 2007. Solutions that bring unified communications, video over IP, voice over wireless and mobility will be key to helping customers find productivity gains from their VoIP investments.

11 Hang A Shingle For Digital Signage. Networking market leader Cisco Systems has blessed digital signage as its latest emerging technology focus and shored up that decision with the acquisition last month (Dec., 2006) of IP video software maker Tivella. Expect the Cisco marketing machine to begin pumping up support for the technology, which means partners selling any ilk of digital signage solution stand to benefit.

12 802.11n — To Wait Or Not To Wait? That is the question solution providers will face in 2007 as the 802.11n standard for high-speed wireless networking nears ratification. Even though ratification isn't expected until 2008, solution providers will be able to get a jump on the technology in the New Year. The Wi-Fi Alliance plans to begin certifying products based on the draft of the standard in the first half of 2007, which should quell the concerns and complaints about interoperability problems between draft-based products that began shipping in 2006. Solution providers will have to decide for themselves whether the pre-standard technology is up to snuff and will prove their value to customers by helping them find the right path.

13 The Power Is In The Switch. Sales of VoIP and WLAN are expected to skyrocket, which means the building blocks of those solutions - switches that include support for Power over Ethernet - are poised for growth too. After all, who wants to restrict placement of WLAN access points to places where there are handy electrical outlets? Some solution providers said most of their customers have already upgraded to PoE switches, but others still see big opportunities in the space for 2007.

NEXT: Predictions in security, storage and software

SECURITY
14 Encryption Will Be Everywhere.
Rare is the week that passes without someone ending up in the headlines over a lost or stolen notebook PC containing sensitive corporate data. Solution providers would do well to position encryption as a technology that's coming of age for its ability to augment perimeter security defenses and protect important data if the unthinkable happens and a laptop disappears.

15 Security Incident Management's Profile Will Grow.
SIM is a critical element in compliance and forensics because it connects disparate security event logs and gives end users a consolidated view of all critical security alerts. SIM touches all corporate assets and gives security integrators the opportunity to gain detailed knowledge of the end user's IT infrastructure that they can leverage to provide additional security solutions.

16 Data Leak Prevention Startups Will Flourish.
Being able to audit what's going in and out of the network helps companies meet compliance directives for safeguarding sensitive data and protect against insider threats. Solutions that incorporate deep content inspection technology are particularly well suited to VARs that have adopted a compliance focus.

17 VARs Can Benefit From Revamping Their NAC Strategy.
Now that the hype around NAC has waned, companies are waiting for the technology to mature before jumping in. That's why it's important for solution providers to fine tune their NAC message to include its identity and role based access capabilities. It's also a good idea to keep an eye on the new startups in the NAC space that employ emerging technologies to address the challenges of keeping malware from infecting networks.

NEXT: Predictions in storage and software

STORAGE
18 Virtualize.
Midrange and larger customers are finding it increasingly difficult to manage their storage environments, and so are receptive to adding virtualization. Talk to companies like IBM and Hitachi Data Systems for the enterprise space, or companies like FalconStor in the midrange. The best thing about virtualization? It's a huge channel play because of those different vendors you get to interact with.

19 Secure.
Lost tapes, stolen laptops, and hacked networks have started companies thinking about how to protect data beyond making sure it's backed up. Now is the time to start looking at how to help them encrypt their data using one of a wide range of technologies including hardware appliances, software encryption, and tape drives with native encryption technology.

20 Replicate.
Falling bandwidth costs along with new software and appliances from several vendors is making it easier to bring remote replication to customers, especially for those with multiple branch offices but without the budget to have on-site storage expertise.

21 Serve.
Get recurring revenue by becoming a provider of managed backup services. This is easier than ever before thanks to a growing number of companies that provide the software and the off-site backup infrastructure so solution providers can provide the services with no or almost no up-front costs. Or use their software to set up your own backup site for customers.

NEXT: Predictions in software

SOFTWARE
22 Get Virtual.
If there's one technology that can help you help your customers save a lot of dough (some of which may come your way) it's virtualization. The technology can get the most out of ever-more-powerful servers and PCs and yet preserves investments in older legacy software. And if companies like RPath have their way, the whole operating system debate may fall by the wayside as mini-OSes get packaged up with applications in a sort of application-appliance model.

23 Watch Consumer Tech Spending.
Businesses used to lead the way on tech adoption but no more! Solution providers need to watch what their kids are using and buying because sooner or later it'll end up in their customers' shops, with or without IT sanction.
Past Examples: Instant Messaging And Google Searches. Current examples: YouTube, iPods, you name it. The VAR who knows how to (proactively) deal with these incursions can be a hero.

24 Get Flexible On Mail.
Folks are raving about Zimbra and other Exchange Server replacement systems. Users may want the Outlook client experience, but none of them give a hoot about what the underlying server is unless it stops working. Give OpenXchange, Zimbra, Scalix a careful look-see. They're good and they're inexpensive and they all support Outlook.

25 Keep A Watchful Eye On Linux And Vista.
There are some disturbing signs that Linux may be fragmenting just as its granddaddy Unix did. If that's the case, Microsoft wins, and mostly because of the stupidity of its rivals. Either way, put Vista under a microscope, if you haven't already. Pundits don't expect real momentum till late in the year (GA is late January) but who knows? They (we) have been wrong before.