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Has MSP-centric Networking Finally Arrived?

Datto’s buyout of Open Mesh and launch of Datto Networking — both confirmed this morning — arrive at a key time for MSPs and the IT vendor community. Amid the cloud and mobile booms, small businesses are seeking “anywhere, anytime” connectivity to their data assets. But the infrastructure must deliver reliable, secure connectivity — while safeguarding the data.

Amid those customer requirements, MSP technology companies have been converging storage and security. Barracuda Networks, for instance, has connected the dots between its firewall and Intronis MSP Solutions (i.e., business continuity) offerings. Datto, meanwhile, has been preparing a push beyond business continuity solutions. The original Datto Networking Appliance (DNA) platform focused mostly on WiFi and routing. But the company pivoted toward UTM (unified threat management)– a natural move, considering security ranks among the top MSP industry opportunities.

Where’s MSP Networking?

Amid that storage-security convergence, another void potentially remains: MSP-centric networking.

When it comes to managed services, networking giants like Cisco Systems and Juniper focus mostly on massive service providers — such as telcos and cable companies. Adtran mostly engages midmarket MSPs. And consumer-oriented networking companies like D-Link and LinkSys have never quite mastered MSP engagements.

The result is a potential MSP networking market void that Datto hopes to fill with the Open Mesh buyout and new Datto Networking business division.

Still, Datto isn’t alone on this pursuit. Numerous hardware, software and IT management companies are popping up to fill the MSP networking void. Also, established players are taking closer looks at the MSP networking segment. Among the examples:

Side notes: Cisco certainly has serious momentum with its cloud-controlled Meraki portfolio, but I see that mostly as an enterprise play rather than a small business networking play. Also, SonicWall is well known for its network security offerings but the company only recently formalized its MSP plan. Datto’s entire base is MSPs…

What Potentially Makes Datto Unique?

Still, Datto has some unique strengths that could help the company differentiate from networking rivals.

For starters, the company blends on-premises hardware (networking, storage) with cloud-centric management and backup services. Datto also is a rare unicorn — valued at more than $1 billion but also profitable, which means the company can plow money back into R&D or more acquisitions without necessarily diluting itself.

Also, Datto sells purely to MSPs. The company doesn’t sell direct. And all products — hardware, software, cloud management services – are engineered from the ground up for MSPs. And the Open Mesh buyout, confirmed this morning, gives Datto a cloud-centric portfolio of networking solutions. Next up: Datto will need to educate its MSPs to monetize, deploy and support those solutions…

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