Arriving Now: Symantec Service Provider Licensing for MSPs

Whether you call it a tipping point or a bandwagon, one thing is clear: Big software companies are adjusting their licensing models to reflect SMB managed services providers (MSPs) and recurring revenue business models. The latest example involves Symantec launching an ExSP Licensing Program for VARs, MSPs and service providers. But how does Symantec’s move compare to rival storage and security options? Here are thoughts from Symantec Channel Chief Randy Cochran (pictured) plus MSPmentor’s perspectives.

Symantec says it now offers “partners the choice of buying Symantec software in a monthly subscription-based model, providing them with greater flexibility in how they deliver solutions to their customers.”

The program covers Symantec security and storage products, according to Channel Chief Randy Cochran. Moreover, Symantec bills partners quarterly — but partners can bill their customers monthly. As a result, partners can potentially benefit from improved cash flow, notes Cochran.

Cochran is quick to note that Symantec has offered ExSP licensing to large service providers since 2006. But now, Symantec is extending the program to SMB partners.

New Player In Crowded Room

Still, Symantec is still learning about the MSP partner ecosystem. One prime example: During the Symantec Partner Engage 2009 conference in Orlando, most Symantec insiders had no idea that ConnectWise was hosting a 1,000-person MSP gathering right down the road.

Also, Symantec is somewhat late to the MSP licensing model for SMBs. Rivals like Trend Micro have long offered service provider licensing to smaller VARs and MSPs. Plus, Trend Micro allows MSPs to manage multiple individual customers as a single virtual organization in order to gain economies of scale on discounted subscription fees. Cochran says Symantec plans to offer similar economies of scale but the initial ExSP program for SMBs apparently lacks that type of scalable pricing model across multiple end-customers.

Plus, competition continues to mount in the MSP pricing model market. Examples include:

• CA Technologies (formerly CA Inc.) recently launched MSP pricing for its ARCserve backup platform.
• Kaseya is plugging Kaspersky Lab‘s security software into its managed services platform.
• McAfee in May 2010 launched a revamped partner program and continues to promote MSP licensing through its MX Logic offerings.
• N-able offers freemium endpoint security (based on Panda Security software) to its MSP partners.
• NetApp recently launched a service provider partner program to connect the dots between VARs and xSPs.
• Sophos recently introduced a managed services partner program.
• Plus, plenty of online storage and online security companies offer white-label recurring revenue opportunities to VARs and MSPs.

Don’t Dismiss the Giant

Despite all that competition, Symantec shouldn’t be underestimated. The company’s endpoint security and on-premises storage solutions remain popular across the IT channel. Plus, security and storage appear to be two prime pieces of low hanging fruit for MSPs.

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