N-able Turns Table On LPI With Low Entry Price

Available Aug. 15, the Momentum System is a no-frills, hosted network monitoring service that will cost MSPs $70 per customer site license per month, said Bill Stewart, vice president of marketing at Ottawa-based N-able. Momentum System drops to $60 per customer per month when an MSP buys five or more customer licenses, he said.

Momentum System's pricing makes N-able the new low entry-cost leader in the MSP platform market, said Matt Briese, owner of Briese Computers, a Rochester, Minn.-based MSP. A price increase from LPI motivated Briese to move his MSP customers to the Momentum System about three weeks ago, he said.

N-able said Momentum System requires no start-up fee, time commitment or cancellation fee. The service, hosted and delivered by N-able, allows MSPs to perform SNMP-based monitoring of customers' Windows and Macintosh clients, network devices and security systems.

"The idea behind Momentum is to provide much faster results, at a lower risk, with a lower degree of effort," Stewart said.

Momentum System doesn't give MSPs access to The BluePrint for Success, N-able's MSP business transformation consulting component. To get that piece, MSPs would need to buy N-able's more expensive Velocity System, Stewart said, adding that MSPs that begin with Momentum can--and eventually should--upgrade to Velocity.

"For $70 a month, you're ready to do remote monitoring and provide reactive managed services," Stewart said. "Will [Momentum] make you into a full-fledged managed services provider? No. To get to where you are making 25 percent operating margins as a proactive MSP that's transformed its business, that's the Velocity system."

N-able's rollout of Momentum System is well-timed, coming amid pricing flux in the MSP platform market.

LPI established a reputation as the market's low-cost leader through its longtime practice of offering its hosted MSP platform for $60 per customer site license per month. In February, LPI lowered its price to $15, putting pressure on rivals such as N-able, Kaseya, SilverBack Technologies, AdventNet and Cittio. And then in May, LPI trimmed its entry price to $5, triggering an all-out price war in the MSP platform arena.

Yet LPI's position as the MSP low-price leader has come under question. Some solution providers said that in January, LPI quietly began requiring up-front payments ranging from $2,500 to $7,000, which canceled out the low entry-level pricing that the vendor had been promoting. Briese, whose firm ran LPI for years at the price of $60 per month per customer site, said problems plagued the LPI service, which often had difficulty reading the status of network devices. So in late 2005, Briese Computers began to take MSP customers off LPI and move them to Microsoft Operations Manager, which also could perform remote monitoring, he said.

During that time, LPI introduced version 5.1 of its MSP platform, which was billed as a fix to many of the problems that plagued earlier versions, according to Briese. When Briese approached LPI to upgrade, he was told that the pricing had changed and he needed to pay $1,250 for LPI's Service Center management console plus buy a minimum of 10 site licenses up front.

"I never received an announcement about that [price increase]. They never sent me anything explaining that," Briese said.

LPI didn't publicly announce the pricing change, said Dan Wensley, vice president of partner development at the Ottawa-based company. "We just kind of overlooked it, or the issue got buried," he said.

LPI's changes require a new partner to pay $2,499 up front for the vendor's Server Center management console and buy three one-year customer site licenses instead of paying $60 per month per customer. "We were bringing on partners for just $60. But we found that wasn't in the best interest of the partners, and it wasn't in the best interest of LPI," Wensley said. "It was such a low commitment that people were just coming on and then going off, and those who did that were just burning up resources."

Richard Rogers, senior consulting engineer at Swat Systems, a solution provider and MSP in Seattle, said he came on board as an LPI partner last year, just before the vendor added the startup costs to its pricing model.

"We could have afforded the higher price [of the new pricing model], but a higher price probably would have made us look more at other options," Rogers said.

Swat is working with several smaller IT consulting firms in the Seattle area that are looking to resell its LPI MSP service, because LPI's entry-level pricing has become too expensive, Rogers said.