Sun To Offer Managed Services To Channel

Bill Cate, director of U.S. Partner Programs for Sun, said managed services is a key focus for Sun's services group and aspects of Sun's managed services platform will be available for partners to sell as a service during Sun's 2007 fiscal year, which starts in July.

"There is just a tremendous energy around managed services," said Cate. "What we want to do is make it more channel ready."

Cate said Sun is developing services for the channel in two buckets, basic and managed, but was not able to give specifics on the offers. He noted that the service would likely be evolutionary, starting with some basic services and building from there.

Much of the managed service infrastructure Sun is using stems from its 2004 acquisition of MSP SevenSpace. One of the benefits Sun picked up as part of the deal was the ability to manage heterogeneous environments.

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Dan Berg, vice president and CTO of Sun Services, said during a dinner with journalists Tuesday that Sun is now able to manage a variety of systems for clients, including servers, operating systems and applications from competitors such as Microsoft, Hewlett-Packard and IBM.

Berg noted that Sun is trying to do more than "event-based analysis." Sun has budgeted R&D money so that engineers can study data from managed services at a deep level and work to predict future problems.

For example, he said Sun is using SevenSpace to manage Microsoft Exchange in a clustered environment for one customer. The system started going down from time to time but administrators couldn't immediately pinpoint the problem. After the system had gone down a couple of times, Sun administrators discovered a set of conditions present that they thought would lead to a crash. They were able to notify the client when these conditions were present and reset the system, rather than wait for the system to crash. At the same time, they worked with Microsoft to pinpoint what they believed was a software bug that was causing the problem.

Berg believes Sun will not private label its managed services, as some independent MSPs do, but would instead likely pass through MSP data, analysis and alerts to partners that are managing customer systems.

Berg said Sun is working to beef up its services capabilities, particularly outside the traditional break-fix warranty service that has been profitable for the company. Cate said 20 percent of Sun's U.S. channel revenue comes from break-fix contracts.

Sun, which has seen its stock free-fall over the past few years, said Wednesday it would continue to pare back its staffing, this time laying off up to 5,000 people, or 13 percent, of its workforce over six months.

Services are considered to be more profitable than hardware, which continues to experience margin pressure, and many companies are emphasizing services over hardware sales. According to Sun's 10Q filing for the period ending December 25, about 37 percent of its revenue came from services, with the bulk of its attributed to break-fix support services. About 63 percent came from computer systems and data management, the company reported.

Besides break-fix services, which all of Sun's partners can either offer or resell, Cate said about 100 of Sun's 500 partners currently participate in an Authorized Sales and Referral Program (ASRP), which lets partners either reseller or participate in Sun services. He said about 50 partners have become certified to deliver identity management, enterprise consolidation, ILM or desktop integration for Sun Services. That program has been available for about one year.

Though at least one Sun partner privately acknowledged working with Sun on managed services, others said they have not heard from Sun on the managed services front.

Ed Gogol, director of enterprise systems at Solarcom, a $350 million solution provider in Norcross, Ga., said the company has not participated in any services programs besides the profitable break-fix opportunities. He said Solarcom operates its own professional services and "Sun's services competes with them more often than works with them."

While Cate acknowledged that many partners would prefer to offer their own professional services, he said partners should not count out Sun Services.

"Vendors can make the mistake of asking a partner to invest in something that might be bad for them," he said. "I think a lot of resellers might look at a program like this and say, 'I don't need that.' But hopefully they are grabbing the [Sun Services] field staff and saying, 'look at me. I may not be on your list of accredited people, but I sure know what I am doing.' Our field staff is really agnostic to that. They are going to want to engage with partners that have the highest degrees of skill that meet customers' SLAs."