https://www.channelfutures.com/wp-content/themes/channelfutures_child/assets/images/logo/footer-new-logo.png
  • Home
  • Technologies
    • Back
    • SDN/SD-WAN
    • Cloud
    • RMM/PSA
    • Security
    • Telephony/UC/Collaboration
    • Cable
    • Mobility & Wireless
    • Fiber/Ethernet
    • Data Centers
    • Backup & Disaster Recovery
    • IoT
    • Desktop
    • Artificial Intelligence
    • Analytics
  • Strategy
    • Back
    • Mergers and Acquisitions
    • Channel Research
    • Business Models
    • Distribution
    • Master Agents
    • Sales & Marketing
    • Best Practices
    • Vertical Markets
    • Regulation & Compliance
    • Diversity & Inclusion
  • MSSP Insider
  • MSP 501
    • Back
    • Apply Now
    • 2020 MSP 501 Rankings
    • 2020 Hot 101 Rankings
    • 2020 MSP 501 Report
  • Intelligence
    • Back
    • Galleries
    • Podcasts
    • Videos
    • From the Industry
    • Reports/Digital Issues
    • Webinars
    • White Papers
    • Channel Educational Series
  • EMEA
  • Channel Chatter
    • Back
    • People on the Move
    • New/Changing Channel Programs
    • New Products & Services
    • Industry Honors
    • Channel Convergence
  • Resources
    • Back
    • Advisory Boards
    • Industry Organizations
    • Our Sponsors
    • Content Resources
  • Awards
    • Back
    • 2021 MSP 501
    • Circle of Excellence
    • Excellence in Digital Services
    • Top Gun 51
  • Events
    • Back
    • CP Conference & Expo
    • Channel Evolution Europe
    • Channel Partners Event Coverage
    • Webinars
    • Industry Events
  • DE&I
Channel Futures
  • NEWSLETTER
  • Home
  • Technologies
    • Back
    • SDN/SD-WAN
    • Cloud
    • RMM/PSA
    • Security
    • Telephony/UC/Collaboration
    • Cable
    • Mobility & Wireless
    • Fiber/Ethernet
    • Data Centers
    • Backup & Disaster Recovery
    • IoT
    • Desktop
    • Artificial Intelligence
    • Analytics
  • Strategy
    • Back
    • Mergers and Acquisitions
    • Channel Research
    • Business Models
    • Distribution
    • Master Agents
    • Sales & Marketing
    • Best Practices
    • Vertical Markets
    • Regulation & Compliance
    • Diversity & Inclusion
  • MSSP Insider
  • MSP 501
    • Back
    • Apply Now
    • 2020 MSP 501 Rankings
    • 2020 Hot 101 Rankings
    • 2020 MSP 501 Report
  • Intelligence
    • Back
    • Galleries
    • Podcasts
    • Videos
    • From the Industry
    • Reports/Digital Issues
    • Webinars
    • White Papers
    • Channel Educational Series
  • EMEA
  • Channel Chatter
    • Back
    • People on the Move
    • New/Changing Channel Programs
    • New Products & Services
    • Industry Honors
    • Channel Convergence
  • Resources
    • Back
    • Advisory Boards
    • Industry Organizations
    • Our Sponsors
    • Content Resources
  • Awards
    • Back
    • 2021 MSP 501
    • Circle of Excellence
    • Excellence in Digital Services
    • Top Gun 51
  • Events
    • Back
    • CP Conference & Expo
    • Channel Evolution Europe
    • Channel Partners Event Coverage
    • Webinars
    • Industry Events
  • DE&I
    • Newsletter
  • REGISTER
  • MSPs
  • VARs / SIs
  • Agents
  • Cloud Service Providers
  • Channel Partners Events
 Channel Futures

Business Models


MSP 2.0? That’s So 2007. Try MSP 4.0 On for Size

  • Written by Joe Panettieri 1
  • October 9, 2013
Some pundits say the MSP 2.0 wave is coming. MSPmentor thinks it's long gone. Instead, look ahead to the fast-approaching MSP 4.0 wave. What comes after cloud and mobile services? Here are predictions.

Pundits tell me the next managed services wave (which they call MSP 2.0) is coming. My reaction? MSP 2.0 happened around 2007. In reality, we’re moving onto MSP 4.0. And savvy managed services providers (MSPs) better get a grip on The Internet of Things (IoT), Big Data and end-user experience. But that’s not all.

Here’s a look back and ahead at each MSP wave. It’s difficult to organize the trends into neatly tied categories but here’s an attempt…

MSP 1.0: 1995-2000

  • The best resellers and VARs shift from product reselling to IT solutions.
  • A small portion of those IT solutions providers seek to develop even more predictable revenue streams. But how?
  • Cable companies and phone companies sure have nice recurring revenue models. Early MSPs attempt to emulate the model. 
  • Home-grown tools to manage VAR businesses emerge.
  • The ASP (Application Service Provider) boom and bust leaves a lasting impact, making some MSPs initially doubt the cloud wave that will emerge in five to seven years.

MSP 2.0: 2001 to 2007

  • Purpose-built tools emerge in areas like RMM (remote monitoring and management) and PSA (professional services automation).
  • The two areas nearly come together multime times. PSA and RMM companies consider buying each other but no real deals emerge. 
  • At least one RMM provider considers building a PSA platform based on SugarCRM, the open source CRM platform. The R&D project never launches.
  • Microsoft delivers Windows Vista to usher in the next wave of IT and channel profits. Apple, meanwhile, delivers something called the iPhone. It’s really expensive and will never sell, nor will corporate IT support it. Never. Um… nevermind.
  • Per-device MSP pricing models begin to emerge.
  • Peter Sandiford (CEO of Level Platforms at the time) blogs about the MSP 2.0 wave. Separately, Bob Godgart (CEO of Autotask at the time) offers his MSP 2.0 thoughts.

MSP 3.0: 2008-2013

  • Despite the global financial market meltdown, many MSPs remain standing and grow, according to the first-ever MSPmentor 100 report (now the MSPmentor 501).
  • Peer groups help MSPs to maximize profits while learning from non-competing executives.
  • Apple delivers a really big iPhone called the iPad. Google dabbles in something called Android. Big tablets without keyboards will never take off in business. Windows Vista is Microsoft’s fastest-selling operating system launch ever. Really. Truly. Um… nevermind.
  • Forget applications. It’s all about apps. 
  • APIs create solid links between PSA and RMM. ConnectWise goes one step further, investing in LabTech Software
  • Major MSP software providers including Kaseya, Zyrion, Continuum, Level Platforms and N-able Technologies get acquired.
  • All-in pricing (the Chocolate Cake model, as explained by TruMethods CEO Gary Pica) emerges.
  • A shift from per-device to per-user pricing emerges and accelerates in many areas.
  • Mobile Device Management emerges but few MSPs initially cash in.
  • Deliver a great “end-user experience” becomes the MSP battle cry.
  • Many cloud services go mainstream. Yes, Amazon Web Services is for real.
  • Cloud-based backup and disaster recovery (BDR) goes mainstream for MSPs.

MSP 4.0: 2014 and Beyond

  • MSPs manage and optimize customer applications regardless of location — on-premises, in the MSP data center or in a third-party cloud like Amazon, Azure and more.
  • Most MSPs abandon plans to build their own data centers. Why create your own power plant when the cloud grid — Amazon, Google, Rackspace, Microsoft, ViaWest, Savvis, SoftLayer and more — deliver plenty of power for MSPs to plug into?
  • The “dream” of building and selling a very high value MSP dies for many companies because most MSPs do not have their own intellectual property. Still, smart MSPs seeking an exit can fetch a price premium — especially those that have vertical market and compliance expertise.
  • MSPs add cloud broker services, helping to source, integrate and optimize multiple SaaS apps for customers. To do this, you’re going to need a Cloud Aggregator Service from a SaaS distributor. Early names like Ingram Micro Cloud, SaaSMAX and Excel Micro come to mind. More will emerge at IT Nation.
  • MSPs finally begin to monetize Big Data applications and services like Hadoop and NoSQL.
  • Some MSPs focus mainly on end-users. Others shift in the complete opposite direction, managing the Internet of Things (Machine to Machine computing, or M2M) and network sensors. If a device is IP-enabled, there’s an opportunity for MSP monetization.

MSP 5.0

  • Too soon to say. Especially since the dinner bell is ringing here at home. That’s all for now.
Tags: Agents Cloud Service Providers MSPs VARs/SIs Business Models

Related


  • Diversity Equity Inclusion
    Channel Futures Debuts Diversity, Equity & Inclusion Advisory Board
    The 11 founding board members, from all segments of the ICT channel, will provide strategic guidance.
  • Spinoff Company
    6 Channel-Impacting Facts About Dell's VMware Spinoff
    Dell's EMC acquisition left it with considerable debt.
  • diversity inclusion in colored letters
    Intel Appoints Dawn Jones Chief Diversity and Inclusion Officer
    The 24-year Intel veteran will also serve as vice president of social impact.
  • Niche
    MSPs Can Improve Value Through Verticalization
    SMBs will turn to a specialized MSP to also be a trusted adviser on cybersecurity.

One comment

  1. Avatar Todds October 11, 2013 @ 12:19 am
    Reply

    We started in 2000 emulating
    We started in 2000 emulating what EDS was doing, even described it in the early days as an “EDS for SMB’s”. I think we learned the term MSP at a MSP alliance conference in 2002/2003. In our experience, RMM tools didn’t become useful until 2003/2004 w/ Zenith (marginally usable back then) and Silverback. We wrote our own PSA in 2002 and Zenith leased it from us in the early days. We found out about ConnectWise PSA in 2006 and never looked back. Amazing how much has changed in our world. But, people still desire a consistent computing experience, regardless of how it is delivered.

Leave a comment Cancel reply

-or-

Log in with your Channel Futures account

Alternatively, post a comment by completing the form below:

Your email address will not be published. Required fields are marked *

Related Content

  • Differentiating for Long-Term Growth in a Commoditized Networking Market
  • Upstack Private Equity Investment 'Largest in Agent Channel History'
  • FireMon Updates Partner Program with Deal-Registration Discounts, Spiffs
  • ARG Acquires Another Consultancy, Seeks 'Growth-Minded' MSPs, Agents

Galleries

View all

Biden Administration Issues Russian Sanctions in Response to SolarWinds Hack, Election Interference

April 16, 2021

Industry Perspectives

View all

SD-WAN Supports More Purposeful Shift to Cloud

April 16, 2021

How Tech Is Transforming Public Safety–and the Implications for Channel Partners

April 15, 2021

Exercising Your Organization’s Data Loss Recovery Abilities

April 13, 2021

Webinars

View all

What to Look For: 2021 Threat Report

April 22, 2021

Health Care and SD-WAN: A Seller’s Guide

April 27, 2021

How MSPs Can Leverage SOCaaS to Improve Security & Grow Revenue

May 4, 2021

White Papers

View all

Carbonite Data Protection and Cyber Resilience

April 15, 2021

Top Tips: How Resellers Can Leverage Rackspace to Enhance Customer’s Cyber Security Protection with Microsoft 365 Security

March 30, 2021

Top Tips: Optimize Your Microsoft 365 Investment with Rackspace Technology

March 30, 2021

Upcoming Events

View all

Channel Partners Conference & Expo

November 1, 2021 - November 4, 2021

MSP Summit

November 1, 2021 - November 2, 2021

Channel Evolution Europe

November 30, 2021 - December 1, 2021

Videos and Fastchats

View all

5 Reasons Diversity, Equity and Inclusion Is Important

Five9 Shares Insights on Implementing a DE&I Strategy

April 13, 2021

FASTCHAT: How Fortinet Reduces Complexity Through Networking, Security

March 31, 2021

Strong Customer Experience Needs Strong Partner Experience

December 22, 2020

Twitter

ChannelFutures

If you needed any more reason to submit your @MSP_501 application, this promotional video will get you fired up!… twitter.com/i/web/status/1…

April 16, 2021
ChannelFutures

.@FrontierCorp just weeks away from exiting #Chapter11bankruptcy. dlvr.it/RxqkK1 https://t.co/yxyChKL9Um

April 16, 2021
ChannelFutures

#SDWAN supports a more purposeful shift to the #cloud @ComcastBusiness #networksecurity #hybridwork #security #SaaS… twitter.com/i/web/status/1…

April 16, 2021
ChannelFutures

RT @alysfitz: 67% of respondents reported burning out since the COVID-19 pandemic hit. We need to do better to support #WomenInTech, especi…

April 16, 2021
ChannelFutures

RT @AllianceofCW: #ACW members Mayka Rosales-Peterson and Raquel Wiley were elected to @ChannelFutures' #Diversity, #Equity, & #Inclusion B…

April 16, 2021
ChannelFutures

.@ZiplyFiber rolls out agent #partnerprogram. #networking dlvr.it/RxmM4K

April 16, 2021
ChannelFutures

New #Microsoft #SurfaceLaptop4 is an incremental update with an improved CPUs webcam, speakers and dual mics.… twitter.com/i/web/status/1…

April 16, 2021
ChannelFutures

.@okta hires @InsightEnt vet as global channel chief. #cybersecurity dlvr.it/RxmM20 https://t.co/ImWRZp2qHt

April 16, 2021

MSSP Insider

Business advice for MSSPs and news from the broader security channel.

Newsletters and Updates

Sign up for The Channel Report, Channel Futures Update, MSP 501 Newsletter and more.

Live Channel Events

Get the latest information on the next industry-leading Channel Partners event.

Galleries

Educational slide shows and images from live events.

Media Kit And Advertising

Want to reach our audience? Access our media kit.

DISCOVER MORE FROM INFORMA TECH

  • Channel Partners Events
  • Telecoms.com
  • MSP 501
  • Black Hat
  • IoT World Today
  • Omdia

WORKING WITH US

  • Contact
  • About Us
  • Advertise
  • Newsletter

FOLLOW Channel Futures ON SOCIAL

  • Privacy
  • CCPA: “Do Not Sell My Data”
  • Cookie Policy
  • Terms
Copyright © 2021 Informa PLC. Informa PLC is registered in England and Wales with company number 8860726 whose registered and Head office is 5 Howick Place, London, SW1P 1WG.
This website uses cookies, including third party ones, to allow for analysis of how people use our website in order to improve your experience and our services. By continuing to use our website, you agree to the use of such cookies. Click here for more information on our Cookie Policy and Privacy Policy.
X