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Because both Seismic and LPI are the same product at their code base, Lawrence will decide to stay with LPI or switch to Seismic based on who delivers better support, particularly after version 6.0 of LPI's code arrives in the first quarter, he said. Right now, LPI costs the same if bought from the vendor or though Ingram's offering, but that could change when Ingram puts a final price tag on it when the hosted version appears in a couple of months.
Bell Micro also is making a significant investment in partner and technical support services for its new SilverBack offering, said Garry Gammon, senior vice president of marketing at Bell Micro. The idea was to foot the cost of creating a hosted MSP platform so solution providers could avoid the expense of having to build an MSP platform in-house, he said. Beyond the technology platform, Bell Micro also spent money to develop MSP-specific marketing and sales support programs.
Then there's Microsoft. In late 2005, when managed services caught fire like dry brush, Microsoft Operations Manager (MOM) was too big and clunky an MSP platform to scale downward into the SMB sweet spot that solution providers-turned-MSPs were tapping. Enter Microsoft System Center Essentials 2007, a leaner, meaner version of MOM designed to compete squarely with popular SMB MSP platforms. Currently in its second beta, System Center Essentials 2007 is a multitenant IT monitoring and management platform that gives solution providers an arsenal of software, infrastructure, security and storage tools to deliver as managed services, said Jeff Johnson, president and CEO of ClearPointe Technology, a 13-year-old solution provider in Little Rock, Ark., which has been in business as an MSP for the past five years.
ClearPointe was enlisted by Microsoft to help develop System Center, he said. "The problem with MOM was, it was such a big solution that it was never an easy sell to the medium-sized much less the small-business server client. But now [Microsoft] takes all the best features of MOM and effectively delivers them to the SMBs. And there is nothing better to manage a Microsoft server than a Microsoft server management product," he said. "I think [Microsoft] is going to own the MSP industry."
Johnson may be right, said Ashton Technology's Millican. If System Center can make his MSP business pay off better than it has, Millican will cut checks to Microsoft for System Center, he said. Pricing has not been released, according to Microsoft. But Millican expects it to be "just affordable enough to reach."
Something New Entirely
Stephen Alexander, president of Third Eye Technologies, a 15-year-old Valley Cottage, N.Y., solution provider that opened a managed services business in 1995, uses an MSP platform from HandsFree Networks.
Who is HandsFree? A six-year-old vendor in Newton, Mass., that "has had the benefit of running under the radar," said company President Alex Donnini.
HandsFree and other vendors such as AdventNet and SecureMyCompany.com, are part of a growing number of upstart MSP vendors out to get partner service and support right the first time around. HandsFree's Linux-based software sits on an MSP's server, but the vendor remotely maintains the software as part of the cost of the product, Donnini said. Like Kaseya, HandsFree's No. 1 strength is multitenant network automation. In the first half of 2007, HandsFree will introduce improvements to its user interface, and enhanced executive-level reporting features, he said.
By coupling the low-cost, $2-per-device per-month cost of HandsFree with a professional services automation (PSA) system from AutoTask, Third Eye can offer MSP customers an affordable, all-you-can-eat service that rolls complete network monitoring, management and remediation into one low monthly payment, Alexander said.
Also posing a threat to larger vendors is SecureMyCompany.com, which by acting like a broker of MSP products enables solution providers to skirt minimum licensing requirements and enjoy the ease of use of a hosted solution, said company Vice President Frank Hughes. Based in Encino, Calif., the 18-month-old vendor offers Kaseya's platform, antivirus products from McAfee and messaging filters from Singlefin, he said.
Instead of an MSP having to purchase a minimum 100-license SKU from Kaseya, SecureMyCompany.com buys bulk licenses and then resells them to MSPs starting at $9.95 a license for between one and 49 licenses, or $6.47 per license for 500 and more, said Hughes. McAfee antivirus licenses can be bundled in for as low as $2.95 per license for 49 and less. Free 30-day trials are available, and there is no volume commitment or cancellation fee. A deal to resell individual licenses of another PSA tool from Connectwise is also in the works, Hughes said.
Dan Silva, owner of Vision Computer Services, a 16-year-old solution provider in Pampa, Texas, launched an MSP business several months ago and now uses SecureMyCompany.com. Vision looked at products from SilverBack and almost bought Kaseya's product outright, he said. But a trial run of SecureMyCompany.com convinced him otherwise. "It simplifies the management of the product. With them doing the hosting and maintaining the network and servers, it makes it a lot easier," Silva said.
Much was said in 2006 about business transformation being the critical component to becoming a successful MSP. But hindsight reveals that technical and support issues taught some of the most serious lessons to the managed services industry.
"What our customers expect from us, I expect from our vendors. That's what we learned," said Weston Technology Solutions' McFarlane. Vendors appear to have gotten the message.