How Flexible is the Cloud?
It is pretty easy to see how you can make money moving clients to the cloud. After all, it is simply a service that mirrors a new server installation very well. Your talented team does the work, and you have a client that is all smiles. Then, gasp, you realize that you just turned off the server you used to support for $150 per hour or $300 per month. Now what do you charge for?
The answer is simple — some percentage of the $300 or the same $150 for anything you do with them. If you got on the MSP bandwagon over the past four years, you are on the fixed fee, per month model like we are. We simply took the price we used to charge for remote only support, around $200 for support during normal business hours, and started charging that for each remote server in the cloud. Amazingly enough, while we make less revenue, we make even more profit and still enjoy the recurring revenue that have helped us grow year after year. Don’t kid yourself thinking that there won’t be ongoing effort to keep the cloud running. The reality is that our clients will be using a plethora of cloud services and our industry will do what it has done for so long — make it all work such that it is seamless to our beloved clients.
We will need to move from one vendor to the next as technologies change and then, one day, the next big thing will arrive and we will run the cycle all over again. What we currently know as the cloud is not the end of the IT industry. In my opinion, it is the current chapter and will be replaced by something new that is better, faster and cheaper within 10 years. The key is to evolve as technology evolves and stay relevant and profitable through each cycle.
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I am seeing MSPs and VARs start off their cloud practice selling some of the tried and true cloud products from companies like Intronis and Office 365. These are no brainer-decisions and offer us with an easy starting point on which to build a foundation to grow a successful and profitable cloud business. From there, you add on other products and servers from proven vendors and before you know it you offer a solution for almost every client situation. Don’t spend the time to get so complex that you cover every avenue — after all, you have great partners like Tech Data (TD) to ask questions about niche needs, and you will need to keep up with your portfolio of companies and services. There is no doubt that this market will grow and mature with new entrants and product evolutions that will make the best solutions for each business need change with time. This isn’t a set-it-and-forget-it game. You will have to refresh your portfolio from time to time to ensure you are always offering the best solution for your clients. While it is obviously a radical change, our industry has gone thru many of these changes in the past and always found a way to make more money each time.
The cloud will be no different. We will change and adapt or run the risk of becoming obsolete. Don’t be afraid of this change, attack it. Figure out what your firm has in its talent base and how you can best leverage the cloud to take your business to the next level. One thing you can’t do is nothing. This cloud thing is a tsunami — surf the wave and don’t get run over by it.
Do you find the cloud flexible? How are you and your customers adjusting to it?
