Cirrity's 'Game-Changing' Buy-In-Bulk Cloud Pricing Meant To Help Partners Up Cloud Margins

Cloud service provider Cirrity is changing up the way channel partners buy and resell cloud by allowing its partners to potentially double their cloud margins.

The Atlanta-based channel-only provider has unveiled its new cloud pricing model that will let partners buy its Cisco-powered cloud infrastructure in bulk and white label the services for their own end customers.

Cirrity is piloting its new cloud pricing model with one of its large managed services provider partners, Onepath, which has been able to decrease its monthly cloud spend while increasing its profitability, according to the provider.

[Related: Cirrity CEO On AWS' 'Arcane' Pricing, Carrier Turmoil And Helping Partners Crack The Cloud Code]

"Under the new model, we are expecting to double our cloud margins," said Sean Vojtasko, executive vice president of advanced technology and managed services for Marietta, Ga.-based Onepath.

Onepath knew it needed to get into cloud services, but because the provider has very large end customers and requires a lot of infrastructure, Onepath didn't want to pay a cloud provider on a "per drink" basis, which quickly adds up, Vojtasko said.

"We needed a solution were we could really gain the benefits of aggregating the compute and storage into a price and be able to get a volume discount as opposed to taking things at cost and building our own infrastructure," he said.

The unique wholesale cloud pricing model is focused on "sophisticated resellers," like managed services providers and strategic service providers. These providers will be able to buy bulk cloud services from Cirrity, and then repackage the services under their own label with their own managed services wrapper, according to Cirrity CEO Steven Vicinanza.

"Partners won't be buying cloud by the server -- they can buy, for example, 500 servers and sell them on a one-off basis to individual customers," Vicinanza said. "This allows them to capture that margin."

While many cloud players don't cater to solution providers, Cirrity's channel-only approach to the market coupled with its latest wholesale cloud pricing option for partners give Cirrity's partners access to a solution set they haven't had access to before, as well as a way to possibly double their cloud margins, Vicinanza said.

"We think it's a game changer for the folks who are able to take advantage. … If we are able to offer something that can offer additional margin, that really gets the reseller base excited," he said.

The wholesale model also gives partners greater flexibility around pricing. Partners will be able to price out their own volume deals or bundled offerings for their end customers, said Dan Timko, president and chief technology officer for Cirrity.

"Instead of going off of a rate sheet we put out, they are getting a wholesale price and they can put a price on top of [that], so especially on smaller deals with only a couple of [virtual machines], they could see significant margins," Timko said.

By taking advantage of buying cloud in bulk, providers like Onepath can white label and present a complete solution to their clients that uses Cirrity's storage offering on the back end, Onepath's Vojtasko said.

"Having that flexibility across all of our clients -- whether they are SMB or Fortune 500 clients, we can put up the right cloud solution for them," he said.

The wholesale pricing model won't be for every provider, warns Vicinanza. The model works best for partners looking to add value on top of cloud services, and providers interested in buying Cirrity cloud in bulk have to offer first-tier support to the end customer, he said.

"There's a little more expertise required," Vicinanza said. "Along with that margin comes some additional responsibility, but typically the larger MSPs are very fond of this model, because they feel like they have the competency to be able to understand the market and take a bulk cloud set of services to mix and match and provide solutions to their customer base."

Cirrity is still keeping its existing cloud reseller model in place for partners who may not be ready to take on the white-label selling model, Vicinanza said.