Hardware as a Service: Thriving In Australia?

While many US managed service providers struggle to master hardware as a service (HaaS), some of Australia's early managed service providers are thriving in the HaaS market -- thanks to creative (but legitimate) financing from local banks, plus a rotation strategy that moves hardware from Australia to China and India.

Here are the details.

During the N-able Partner Summit in Dallas, I met Scott Jackson, general manager of ITAssociates, a managed service provider in Brisbane, Australia. Although ITAssociates is just getting started in the managed services sector, the company (and several other Australia VARs) are more experienced in the HaaS industry.

Imagine, for instance, a $100,000 hardware deployment involving multiple PCs, laptops and related software. According to Jackson, a local bank has come up with a lending system that's a win-win for customers and MSPs. In a typical scenario, the bank will finance the entire HaaS deal using a three-year payment schedule. The MSP receives an up-front fee from the bank, but does not receive recurring monthly revenue.

Good As New?

At the end of the 36-month payment schedule, the bank takes back all the systems, cleans them up and then resells the used hardware in China or India, according to Jackson.

So, how does the MSP win? In addition to receiving the up-front fee from the bank, the MSP can provide deployment, consulting and maintenance services around the HaaS network.

Yes, I'm skipping a whole bunch of financial facts that Jackson mentioned to me. But as I head to Australia for multiple managed services events next week, I will be sure to more fully investigate HaaS trends down under.
TAGS: Financing
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