Cloud Aggregators vs. Master MSPs: What’s the Difference?
Master MSPs — which offer VARs and peer MSPs a range of services — are evolving in multiple directions. Some Master MSPs continue to successfully onboard VARs and assist the MSP transformation process. Others have exited the market because it’s challenging to recruit and retain fledgling MSPs as paying customers. And generally speaking, I think some Master MSPs are shifting their focus to a cloud aggregator role. So what’s the difference between a cloud aggregator and a master MSP? Here are some educated guesses.
First, let’s rewind a bit and explore the history of the Master MSP market. Back in 2008, I expected dozens — yes, dozens — of Master MSPs to emerge, supporting thousands of VARs and MSPs across North America. Companies like Do IT Smarter, MSP Services Network (MSPSN) and Virtual Administrator led the early Master MSP charge. Distributors such as Ingram Micro also weighed in with the Seismic partner program.
Fast forward to the present and it’s clear some of my assumptions about the Master MSP market were wrong. Some Master MSPs have thrived, but others struggled because recruiting, training and retaining small VARs and aspiring MSPs was either too costly or too complicated to master (pun intended).
Who’s In the Game?
So what’s the state of the current market? Master MSPs like Do IT Smarter and Virtual Administrator continue to march forward; players like MSPSN have exited the market; veterans like Cloud Services Depot have become MSP software distributors; and giants like Ingram Micro and Arrow ECS (Enterprise Computing Solutions) are talking more about cloud aggregator services. So what’s the difference between a master MSP and a cloud aggregator?
Virtual Administrator’s Rich Forsen says true Master MSPs are like health care clinics while cloud aggregators are like medicine cabinets: The clinic provides hands-on assistance and long-term nurturing to MSPs, while medicine cabinets offer a range of products that may or may not help your specific needs.
Distributors may object in some ways to that comparison, but I understand Forsen’s point. Over the past year or two, Virtual Administrator has spent less time emphasizing third-party MSP tools (i.e., aggregation), and more time promoting Virtual Administrator’s own education, support and content services. Somewhat similarly, Do IT Smarter emphasizes its single point of contact and support services — rather than leading with third-party MSP software tools.
Meanwhile, distributors such as Ingram and Arrow ECS are talking up cloud aggregator services. As a whole, I believe distributors remain committed to MSPs, but the managed services strategics increasingly fit under cloud umbrellas.
At the Parallels Summit earlier this year, Ingram Micro VP of Managed Services and Cloud Computing Renee Bergeron said Ingram was the leading cloud aggregator. Then earlier this week, Arrow Fusion VP Lee Fawcett described Arrow’s own cloud aggregator strategy to me. The efforts so far…
- Ingram in November 2010 launched the Ingram Micro Cloud, which helps VARs to find managed and cloud services from big names (Amazon.com, IBM, Rackspace, Salesforce.com) and upstarts (Intermedia, NetEnrich, etc.).
- Arrow promotes managed IT services within the broader Arrow Fusion Cloud Services strategy. NetEnrich, here again, plays a role. There’s also an emerging cloud relationship between Arrow and Terremark, which will host SaaS applications for VARs and MSPs. And I’d also watch to see if an apparent Arrow-Verio relationship blossoms.
On the one hand, I believe Ingram, Arrow and other distributors are committed to MSP education. In fact, Synnex just launched a major managed services push earlier this month. But smaller Master MSPs also have a unique take on the market since they live every day as SMBs themselves — a potentially comforting fact for VARs and MSPs seeking help.