By IBM Guest Blog 1

Here’s a point of view: It is now clear that there is a dividing line between MSPs that have a legacy cost structure driven by investments in hardware and people to manage those environments and newer MSPs that have an altogether different cost structure due to investing in cloud-centric solutions. Some in the prior camp will successfully transition their businesses into an annuity cloud business, but the majority will not. The leap is just too significant.

IBM and Softlayer can help these companies bridge that gap and make the transition successfully. On July 8, 2013, IBM completed its acquisition of SoftLayer, the world’s largest privately-held IaaS provider. This strengthens IBM’s already deep commitments to MSPs (see video), including MSP offerings, an MSP partner program, and MSP pricing options. There are three powerful ways that IBM and SoftLayer can help MSPs change the game:

1. Reduce the Risk

It’s incredibly hard to unbuckle legacy investments that are producing positive cash flow that in turns fuels your operational expenses. That fixed cost prohibits investments you’d otherwise make in new cloud initiatives or new growth objectives. The cost constraints can come from lack of capex, too much debt and not enough positive operating capital, or just not enough cash, period.

With options from IBM and SoftLayer, MSPs have a wide range of on-premise and cloud options to choose from to match their business objectives, ranging from best-in-class x86 systems as a service to cognitive systems like Watson to flexible cloud rental environments where you pay by use. Very few vendors offer the range of physical or virtual compute-storage-network-management options as IBM now does.

By having this incredible flexibility in business design, your MSP can reduce risk and be an agile business. MSPs can choose from whatever infrastructure best meets their cloud transition trajectory and business model objectives, managing between diverse environments from virtual to physical, dedicated to shared, private or public, and more.

2. MSPs Gain From SoftLayer Continuing to be SoftLayer

Financials aside, IBM’s acquisition can almost be viewed as a reverse integration where IBM will learn from, promote, and nurture all the great attributes of SoftLayer. Missing is the classic, efficient acquisition integration like other companies IBM has recently bought.

SoftLayer has 21,000 customers primarily acquired through inside sales and a world-class self-service website where it is possible to spin up a new cloud environment in under 5 minutes with just a credit card. Try that on ibm.com.

SoftLayer has had tremendous success with their model and IBM recognizes it has lots to gain from nurturing that model. Also, the workloads SoftLayer brings to IBM include new born-on-cloud growth areas relevant to MSPs, like mobile, social, big data and analytics. This alignment is important because SoftLayer now becomes a proven cloud platform to incubate growth companies that can grow into the broader IBM portfolio. For MSPs wanting to continuity and assurance of business continuity during the future integration period, this is reassuring.

3. Enabling Higher Value, Deeper Sophistication

The final way IBM and SoftLayer can change an MSP’s game is to enable their solution to be of higher value and deeper sophistication via the nearly 2,000 APIs that SoftLayer offers. As MSPs broaden their ecosystems to include other partners, especially ISVs and VARs, they seek automation at every reasonable point in order to enhance the user experience and to cut costs from manual intervention and exception handling.

Open APIs allow for almost every feature and function of SoftLayer’s Bare Metal as a Service, Public cloud, and Private cloud to be automated and integrated into an MSP’s solutions. In fact, having such a wide range of service available will power SoftLayer to be a top choice for Cloud Service Brokers looking to differentiate their business and automate key provisioning, billing, and service functions.

The VAR guy (@thevarguy) in this blog states that these types of firms can accelerate their business by working with a distributor. Many distributors, like Arrow (Arrowsphere) and Ingram Micro (Ingram Cloud Marketplace) are already standing up dozens of cloud options in order to expand the MSP ecosystem and enable MSP’s to realize higher value and differentiation. They, along with the MSPs they service, have lots to gain from an API-enabled IaaS like SoftLayer.

So change your game by considering SoftLayer as the vehicle to reduce your risk, transition to higher value and differentiation, and broadening your ecosystem through automated services.

If you have any questions or would like a free consultation on how to change your game, email me: [email protected] or @Timothy_Tsao on Twitter.