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Data Center VAR OnX Successfully Transitions To Hybrid Cloud Model

Data center solutions provider OnX shows growth for fiscal year 2014 with its transition from a traditional technology model to a cloud consumption model.

Data center solutions provider OnX Enterprise Solutions' adoption of the public/private cloud and managed services model has proven profitable for the first half of fiscal year 2014, which began May 1.

The Toronto-based VAR, which ranked No. 44 on CRN's 2013 Solution Provider list, has had a 20 percent revenue growth and 50 percent growth in profitability compared to fiscal year 2013. This growth has resulted in transitioning from its traditional technology model to a cloud consumption model, said Paul Khawaja, president of OnX Canada.

"What has helped us to grow is working with our clients to transition from a traditional IT consumption model to a converged infrastructure," said Khawaja. "It took us courage because the biggest challenge that we're going through was ensuring we're not cannibalizing our product business too fast and that we are moving the best solutions forward for our clients in a timely manner.

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"Making the move from a traditional technology model to cloud was simply inevitable," Khawaja said. "It's obvious to us that cloud is a new wave of computing in our industry that obviously off-loads workloads from a traditional consumption model, to converge, and eventually to cloud, where the operational expenses are there, it's well-managed and the returns are financially sound."

Currently, OnX provides dedicated private hosting along with a hybrid cloud model, and the benefits are strong in hosting and delivering a cloud consumption model, said Khawaja.

"Frankly, right now we and the entire industry are feeling shrinkage in product numbers," said Khawaja. "What's happening is that we are effectively managing through that transition instead of relying on hardware and software numbers. Now when we work with our clients, we can work with them on the cloud. We are seeing strong growth and that's a big benefit for us."

What differentiates OnX is the way the company helps clients make that transition, because they are still somewhat uncomfortable making the move, said Khawaja.

"We have clients who are not comfortable stepping into a shared environment, so we help by moving their data out to a virtual data center," said Khawaja. "Because of that success, a lot of clients are coming into our data center through dedicated provided hosting, and then they get comfortable that their storage is a little further away, safe and secure, and within six to eight months we start seeing them more comfortable with a cloud solution."

NEXT: Cloud Move Imperative For Channel And Its Clients: Making The Transition

An additional change for OnX within the company includes transitioning and enabling the workforce, further adding to their growth, said Khawaja.

"The first thing we had to do was build our sales force's confidence, let them know that we are good at this and that we're putting money and investing heavily into our data centers," said Khawaja. "Then we started education sessions, got feedback from our sales team, and we also now have subject experts that deeply understand cloud and managed services, to help them move the opportunity along to clients."

For the channel and its clients, making the adjustment to cloud is necessary, especially for IT, said Khawaja.

"If they don't make the switch, they will be in a difficult situation within two to three years at best," said Khawaja. "It's IT departments who look at it hesitantly, who quickly realize that companies like OnX are doing work they don't want to do, which allows them to work closer with the business."

For the future, OnX looks forward to creating new solutions, especially around Software-as-a-Service (SaaS) and IT-as-a-Service, said Khawaja.

"We plan to continue to transform our business into cloud and managed services, and leverage a strong base for digital application solutions and backup solution for our clients, and with our U.S clients, it will be similar."


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