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Most MSPs Suffer From Amazon AWS, Azure Cloud Denial

Focus your eyes on Las Vegas this week. The Ingram Micro ONE conference and Amazon AWS re:Invent gathering are situated about a mile apart from one another. But if you listen to attendees at each event, the conversations are worlds apart.

The bottom line: Most MSPs — the true believers in recurring revenues — somehow continue to deny the need to embrace or at least investigate Amazon Web Services and rival Microsoft Azure. I’ve seen the trait over and over again at channel conferences this year.

Alas, cloud judgment day is no longer approaching. It’s already here. Roughly 32,000 people are at the AWS re:invent conference. Most of them represent the DevOps wave. Some savvy midmarket MSPs and channel industry veterans also are at the Amazon event — though you need to look extra hard to find them in the massive crowd.

Tim Brewer

Tim Brewer

Christopher Rajiah

Christopher Rajiah

Tim FitzGerald

Tim FitzGerald

Kevin O'Brien

Kevin O’Brien

Hey, there’s…

Those channel and MSP pundits spent the week networking at AWS re:Invent. Thousands of MSPs and VARs didn’t…

AWS: Signs of MSP Progress

Equinix, the cloud network interconnection company, hosted a dinner for roughly 50 MSPs and strategic alliance partners Tuesday night. Names like Datapipe, F5 Networks and NetApp attended the gathering. As did ChannelE2E.

Some savvy MSPs leverage Equinix to build secure, high-speed connections between on-premises systems, co-location centers and public clouds. In some ways, Equinix is emerging as the Internet glue that holds together hybrid clouds. Some MSPs know this. Most don’t.

Meanwhile, companies like Datadog, Digital RealtyDocker, Rancher and Weaveworks hosted a media gathering Wednesday night at AWS. Many of those players have emerging channel partner programs. Additional players like Splunk used AWS to launch small-team editions of their products

Mass Market MSPs: Late to the AWS Party

Here’s the irony: First-mover MSPs got addicted to recurring revenues from remote PC and server management. But that’s now a mass-market, commodity approach. As best-selling author Seth Godin told Ingram’s partners today: It’s time for channel partners to ESCAPE from the mass-market culture. And yet, most MSPs think they’re on the “leading edge” of cloud services by reselling Office 365 — the most mass market cloud productivity platform I can think of.

To Ingram Micro Cloud‘s credit, the distributor now has 10 million cloud endpoints under management — helping partners with a range of cloud solutions that extend far beyond Office 365. Ingram has spent nearly a decade training VARs to become MSPs, and then training those MSPs to extend into cloud services.

But the MSPs — not the distributors — have to find the courage to push beyond SaaS toward true cloud workload management. What about infrastructure as a service (IaaS) and platform as a service (PaaS)? As one MSP at the Ingram event told me, “I wouldn’t even know where to start in those markets.”

MSPs: Go Pursue Answers

Renee Bergeron

Renee Bergeron

Hello… The answer awaits you at both Ingram Micro ONE and Amazon re:Invent. For starters:

  • Go ask Renee Bergeron, senior VP, Ingram Micro Global Cloud, where the distributor is heading with IaaS and other cloud services. She has short- and long-term answers — but partners need to take the time to ask the right questions.
  • Start attending cloud-centric conferences — including these 10. And yes, Ingram Micro Cloud Summit is now confirmed for 2017.
  • Investigate how first-mover MSPs make money on AWS.
  • Ask Microsoft about the online resources they’re building for MSPs that embrace Azure (hint, hint… surprises coming).

No doubt, monetizing and managing workloads atop AWS or Azure sounds intimidating. But as Ingram guest speaker Seth Godin said Wednesday:

“There a difference between management and leadership. Management is the assembly line — you do the same thing faster and get more efficient. Leadership is when you admit, “I don’t know how to get there but let’s figure it out together.”

Be a leader. MSPs must escape from the AWS and Azure denial. Figure out a way to monetize those workloads on those two platforms. The reason? History tells us IT industries typically consolidate around two platforms:

  • Windows and MacOS dominated desktops;
  • Windows and Linux dominated servers; and
  • iOS and Android dominate mobile.

In the case of cloud computing, it’s AWS and Azure. What the heck are you waiting for?

PS: Amazon announced a range of partner programs this week. And MSP-centric companies unveiled a range of solutions at AWS re:Invent. We’ll offer our analysis on those items sometime Thursday. Track all AWS re:Invent coverage here.

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6 Comments

Comments

    Dustin Bolander:

    I’d even say a lot of MSPs are a step below what your article proposes. We recently picked up a client from a well established, good-sized, reputable competitor, because the client wanted to migrate to a cloud based PBX and also uses Google Apps – both things the MSP said they would not support. On prem setups only.

    It’s amazing that people are that far behind the curve on purpose. I know we’re not on the bleeding edge but we’re well aware and working on it =)

      Joe Panettieri:

      Dustin: Please keep ChannelE2E posted as you continue the business journey. Curious to see where you head on the cloud PBX front, and what it means to your monthly recurring revenues, margins, compensation, etc. Thanks for your readership.
      -jp

    Renee Bergeron:

    Many partners asked me this week, where do I start and will I need to cannibalize my onprem business? Just start by putting forward a cloud alternative to your customers for every onprem proposal you make!

      Joe Panettieri:

      Renee: Thanks for the briefing this week at ONEIngram. Safe travels and looking forward to continued updates.
      -jp

    Brendan:

    I think the leading MSPs are operating in the more practical zone of leveraging the cloud to solve real problems for customers, and that’s so often a hybrid of cloud and on-prem. All cloud is expensive and generally a big stretch outside a comfort zone for an established business, so the process of moving them there is not as fast as it can be in an enterprise with IT staff who are there to shepherd and guide the business daily. (aka: lots of hand holding, training, coaching, counseling, and tweaking).

      Joe Panettieri:

      Hey Brendan: I certainly understand the approach. It makes good economic sense. But I’m still surprised that so many MSPs take so little time to explore the major non-channel gatherings…
      -jp

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