APC Sets Sights On Managed Services Channel Transformation

APC by Schneider Electric is poised to launch a managed services channel offering this fall backed up by new software services aimed at driving recurring revenue for partners.

APC on Thursday is slated to start laying out to channel partners its plans to help them take advantage of managed services. Those new services, APC said, will open the door for partners to add data center power and cooling services far beyond the traditional sales and services of APC's power protection/management hardware and software.

Rob McKernan, APC's senior vice president of global IT channels, who is leading the managed services channel charge, said he sees the new program establishing the "APC partner model of the future."

[Related: APC Beefs Up Partner Support, Adds New Incentives]

"I think it can really drive the next many years of revenue stream and profit stream for both of us," said McKernan, referring to the strong APC-partner bond.

McKernan is a 17-year APC veteran who helped lead the company's power protection channel renaissance in the late '90s. In January, he was appointed to the global channels role, where he oversees more than $2 billion in channel revenue and more than 100,000 channel partners.

McKernan, whose new role includes responsibility for channel product research and development, is charged with delivering APC managed services offerings that will be sold by the company's partners. "I'm spending a lot of my time, and forcing my R&D people to get outside of their comfort zone," he said of the services development effort.

Key to developing those managed services is APC's PowerChute software for UPS management, safe system shutdown and energy management that ships with every UPS shipped to the channel, McKernan said.

PowerChute already provides partners with data around uptime, power quality and environmental conditions inside server closets or rooms or inside small to large data centers, he said.

"We have a lot of the technology," McKernan said. "I think we need to bring it together a little bit more succinctly, and I think we need to really sit down and work with the partners on how we can build the revenue stream opex for them. And I think we're on our way. I really do."

So do APC's channel partners who have been waiting to add data center power protection and management services to their existing managed services offerings.

Dan Beeler, director of the data center division of CompuNet, a Meridian, Idaho-based solution provider and APC channel partner, said his company has significantly expanded its managed services capabilities over the past year to about 12 engineers, who are hungry for new managed services to offer.

"For us, APC could round out our managed services portfolio," Beeler told CRN. "We want to go end-to-end from the physical layer all the way out to customers' clouds, and to manage anything and everything they do. Almost every customer we have in our five-state area with rack solutions [is also an APC customer]. So this is a big opportunity for us."

Managing data center power is no longer a task data center clients can handle using traditional tools, said Paul Cronin, senior vice president and partner at Atrion, a Warwick, R.I.-based solution provider and APC channel partner.

Cronin told CRN that traditional data center power management is more a matter of getting alerts when a power supply or battery is not working than of understanding the health of the power environment.

APC's PowerChute application already allows partners to monitor power and take steps like changing batteries and adjusting power loads as needed before they cause a major data center issue, he said.

Comparing the total power requirements of the hardware to the available amount of power is no longer enough, making managed services increasingly essential for efficient operations, Cronin said.

"Data centers are becoming more complicated," he said. "You could plug hardware into power. But with virtualization and a focus on racks, customers are adding more compute and storage equipment. The system will operate. But there may not be enough power to back up the system."

There are tools to help with planning, Cronin said. "But we know that managed services will grow because people don't have the time to manage it on their own," he said. "It's no longer a question of uptime and downtime. It's more complex. Customers can't be reactive anymore. They have to become proactive."

Cronin said data center power managed services rounds out the edges of a complete managed services offering.

"It provides more value to customers," he said. "It gives us insight to help us be more proactive and build our customer relationships. It adds incremental revenue. And most importantly, it's an additional Achilles heel support for customers. When there's no power, it's a setback."

APC's managed services offerings are of great interest, said Ashley Garrison, inside sales manager at Howard Technology, an Ellisville, Miss.-based solution provider and APC channel partner.

"It's absolutely something we want to bring on," Garrison told CRN. "We currently have a managed services offering, but nothing in the areas APC focuses on. But we have already started talking to customers about it."

For a company like Howard, APC's managed services means recurring revenue, Garrison said. "But for customers, it's peace of mind," she said. "They can worry less about maintenance. We have as customers school districts with large installations but few IT people, and so they need that kind of help."

Gordon Lord, APC's director of North American channel strategy and IT distribution, said that while the PowerChute software has been around since the 1980s, it is now integrated in Microsoft and VMware environments.

"That software is one of the best-kept secrets we have in the IT channel now," Lord told CRN. "We've got some hooks in VMware that help with virtual machine migrations. ... We're going to continue to invest in those integrations to make sure we are current with the latest revisions of VMware vSphere when we go with, say, Cisco UCS Director or UCS Manager. And that's going to really cause that integration with the partners so they can go drive services off from that services platform."

APC is looking at working with key managed services platforms that channel partners already leverage, including Kasaya and N-able. "We want to make sure that we can enable the partners that leverage those platforms and those communities," he said. "We want to make sure we have a strong tie-in to that, and they can drive annuity revenue based on those tie-ins."

APC will provide partners who have built out their own managed services platforms will have a program of their own as well, Lord said. "(And) we are going to work with some of the big distributors out there who have their own MSP programs and are enabling those partners," he said.

APC last week also unveiled an expanded alliance with storage vendor EMC's VSPEX reference architecture, a move Lord said speaks to the evolving landscape of where partners are going.

"You're seeing IT simplified to a degree of actually taking some of the value away from some of the resellers: provisioning of servers, networking and storage," he said. "So we need to make sure we can help them round out the solution. And their ability to go manage the power, the power management piece of it, that's a real big point to EMC in taking us on as an ecosystem partner."

Steve Burke and Jennifer Follett contributed to this story.

PUBLISHED MAY 11, 2015