Autotask, ConnectWise: Very Different, Both Growing

Instead of trading blows with one another, the two leading PSA (professional services automation) are starting to take their cases directly to the people. During ConnectWise Partner Summit in Orlando (Nov. 4-6), I can't recall a single mention of the competition. And from Nov. 4 to Nov. 6, rival Autotask offered multiple updates on its October business performance and year-end outlook. Here's a look at the latest chatter.

During his keynote at ConnectWise Partner Summit, CEO Arnie Bellini described how IT Nation (his term for progressive MSPs and VARs) can defend the "last mile" against big vendors pushing into small business. More than 900 MSPs and VARs attended the event, the largest in the MSP industry.

At some previous ConnectWise events, Bellini took aggressive jabs at the competition. But I didn't hear any of those jabs this time around. Bellini emphasized a need for ConnectWise MSPs to collaborate on long tail opportunities, such as IP video surveillance. He also highlighted numerous ConnectWise user groups popping up across North America, Europe and Australia.

Also of note: ConnectWise Community Director Jeannine Edwards described how the company's community would continue to grow, including plans for an even larger ConnectWise Partner Summit in 2010.

Overall, ConnectWise appears to remain in growth mode. As Bellini mentioned to me in July 2009:

For 2009, ConnectWise expects to generate roughly $24 million in annual revenue, up from roughly $16 million in 2008. Also, Bellini expects $11 million to flow to ConnectWise’s bottom line in 2009, up from $6 million in 2008.

Equal Time: Autotask

Meanwhile, Autotask tactfully issued three key press statements to remind media, MSPs and partners that Autotask is a growth company in the PSA market. The press releases surfaced one-by-one (Nov. 4, 5 and 6) during the ConnectWise Partner Summit.

In one release, Autotask suggested that its October 2009 business performance may indicate an economic upturn for the IT services community. According to the release...
more than 300 individual IT Service companies placed new orders or upgrades for Autotask. In addition, the company saw more than 1,000 new seats added to its subscriber base – an indicator that IT service firms are hiring again.
In a prepared statement, Autotask CEO Bob Godgart said October 2009 was "a big month for us. Our biggest for the year, and one of the largest spikes in activity from individual companies." Godgart also mentioned growing momentum for TaskFire IT service desktop solution. Plus, 20 percent of Autotask revenues now come from outside the U.S.

Also of note: Interwork Technologies (Interwork) chose Autotask as the "exclusive professional services automation (PSA) offering" for all of its 4,000 VARS and solution providers. In a similar deal, SMB Technology Network is embracing Autotask.

This is part of a growing trend across the managed services market, where MSP software providers strive to become the de facto standard for associations, organizations and peer groups. For example: HTG Peer Groups has embraced ConnectWise.

Multiple Winners (For Now)

One of my favorite books about the software industry is "Everyone Else Must Fail: The Unvarnished Truth About Oracle and Larry Ellison," written by the late Karen Southwick.

In the book, Southwick explores how Ellison dismantles his rivals even as he grows Oracle.

No doubt, software companies in all market niches compete fiercely. But does the "Everyone Else Must Fail" example apply to the PSA market? Not yet. ConnectWise and Autotask both are growing, and Tigerpaw Software (another key player) is finally polishing its brand and attending a growing number of MSP-oriented events -- such as the recent N-able Partner Summit.

Stirring the Pot?

In recent months, some readers have accused me of "stirring the pot" as Autotask and ConnectWise compete in the PSA market.

Folks, I just report what I hear: If Bellini takes shots at Autotask and suggests he's ready to buy software partners and rivals, I'll report it. If Autotask issues a wave of press releases during the ConnectWise Partner Summit, I'll report it.

But I'll also add my perspectives. And in the past week, my perspectives have changed a bit.
  • Instead of focusing on the competition, Bellini spent ConnectWise Partner Summit focused on his company's partners and customers. Smart move.
  • Instead of yielding the entire week to ConnectWise Partner Summit, rival Autotask provided some timely updates about its own business performance, market growth and customer wins. Smart move.
Both companies are growing. And for now, the PSA industry has multiple winners. Could that change amid a future wave of consolidation? Certainly. And we'll be sure to offer our two cents, if that wave ever arrives.

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TAGS: PSA On Premise
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