Innovation, Not Price, Will Decide MSP Victors
Instead of battling on price, managed service providers hope to spend 2007 battling on innovation. Consider the situation at SilverBack Technologies, which provides software that transforms VARs into MSPs.
“We didn’t start the [MSP] price war, but I’d say we finished it,” quips Peter Klanian, VP of global sales at SilverBack. The company launched a tiered pricing model for VARs in November to counter pricing changes at LPI Level Platforms and N-able.
More recently, MSPs have been striving to enhance their platforms for VARs. But choosing an MSP partner isn’t easy. In addition to SilverBack, LPI and N-able, well-known MSP options include Kaseya and Klir Technology.
Some MSP software providers have thousands of VAR partners. But that may not be the best measure for success, according to Klanian. SilverBack has far fewer VAR partners–about 130–but each partner typically manages about 25 customer networks using SilverBack’s MSP software. Translation: The average SilverBack VAR generates recurring revenue from 25 customer sites–every month.
Looking ahead, Silverback will soon unveil a “Seven Step Guide” to help VARs become MSPs. Klanian concedes that the transformation process can be difficult for some VARs, as we pointed out last summer.
SilverBack also is preparing version 6.1 of its software platform, which includes performance management enhancements for Cisco VoIP networks. And by mid-2007, watch for SilverBack to deliver an improved user interface.
Care to learn more? Several MSPs are hosting partner events to recruit and train VARs. N-able’s next Regional Partner Summit is Feb. 16 in Los Angeles and Kaseya is hosting a multi-city road show. Details about SilverBack’s next big partner event are pending but should be announced soon.