DLT's Alan Marc Smith: Solution Providers Must Prepare For The Inevitable Rise Of Subscription Services

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Kay isn't worried about his sales team handling the change in commission, or selling services as opposed to hardware.  "Our [sales team] will be fully on board when the time comes," he said.

Making the shift to recurring revenue is critical for every solution provider organization, especially as their customers' legacy infrastructure begins aging out, some of it beyond patching or repairing, Smith said.

As businesses modernize their IT environments, they are moving to the cloud. While there are still three distinct cloud offerings today -- public, private, and hybrid -- hybrid cloud is going to ultimately win because some companies, like government agencies, will never use public cloud for all its data, he said.

"[Cloud computing] is going to become prevalent and there's nothing that's going to stop it at this point," he said. "IT revenues are going to be driven by the move to the cloud." 

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