In order to stay nimble and effective in the marketplace, more companies are getting out of the tech management business, and focusing on their core offerings, providing a wealth of opportunities for players in the managed service provider (MSP) space.
Jay Newman, senior VP of hosting provider Peer 1 Hosting, speaking at the IBM PartnerWorld Conference, in New Orleans, said businesses are focusing on what they're trying to achieve versus building out huge IT infrastructures. “What we tell clients is that we'll focus on the problems of the Internet so you can focus on the opportunities. That's where the growth is coming from.”
data management company Actifio, said there are two reasons why managed services are getting broader adoption: “The applications have gotten better and the cost to deliver infrastructure as a service has gone down by 50% to 70%. Where the customer used to have to buy 10 to 11 products, they can now buy one.”
According to Newman, many companies are concerned about growth and whether their infrastructure will be able to keep up. “What every company that starts off with two guys in a garage and grows from there worries about is scale, and its ability to grow without headaches, no matter how big or small it is. They want a service that will be able to grow with the company.
“One common theme among all our clients is how to grow without adding extra infrastructure.”
Sullivan noted there are a growing number of applications in areas like customer relationship management, where the enterprise retains control over the system while outsourcing the infrastructure underneath. “They want to control their assets, but outsource the rest to the cloud.”
He added that there are two service provider scenarios: either offering a managed service with a partner, or driving the internal IT staff to become more like a cloud provider, seeing a shift in the skills of the IT organisation from app development to service models.
Newman said there's no doubt cloud will become a stronger business model, although cloud isn't all things to all people. “The most significant for us is people working on a hybrid basis, not just a cloud basis.”
Ed Abrams, VP of marketing for midmarket at IBM, said there are two real trends relating to the midmarket customer - the explosion of mobile use, meaning information needs to get out to many more users in many more ways, and the need for platform as a service and infrastructure as a service offerings.
“It's about bringing together a large variety of services but still providing a trusted product.”
Newman anticipates more innovation happening from the inside out: “We'd like to see evolution of really smart people coming up with new ways to use technology, both in their own companies and from an end-user perspective.”
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