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Three SMB Trends for 2012

Three SMB Trends for 2012

As a sales VP, it’s part of my job to look ahead and make predictions for the year. Based on my experience providing technology solutions to MSPs in the small and midsized businesses (SMB) space, I expect to see the following cloud-related storage trends accelerate in 2012.

The lineup includes...

1. Increased growth in SMB use of SaaS-based data storage

A growing number of SMBs are buying in to cloud technology. Deloitte’s most recent “Forecasting Change” report on Cloud Computing predicts the Software as a Service (SaaS) market will experience a year-over-year growth rate of more than 17% to reach a value of $17.8 billion in 2013. At the same time, SMBs find the amount of data they need to retain is increasing at a rapid rate. The growth of the digital universe as a whole more than doubles every year, now at around 2 zettabytes versus 1 zettabyte a year ago (IDC Digital Universe Study, 2011).

Regulations like Sarbanes-Oxley, HIPAA, the OSH Act, and others have strict rules for SMBs when it comes to the secure backup and recovery of files, causing the amount of stored data to grow even faster.

Cloud-based SaaS applications for SMBs especially make sense in the area of data storage, where SMBs can get the level of reliability that was previously available only at “enterprise prices” at a price an SMB can afford. What’s more, cloud solutions give SMBs the scalability and flexibility they need, without having a lot of upfront costs or infrastructure to maintain.

2. Increased SMB demand for business continuity

SMBs today are more dependent on the uptime of their data and applications than ever. Think about your own expectations for your financial data, for example – you need the businesses managing your accounts to have your data accessible 24/7, and downed servers or power outages are not an excuse. You’ll find different service providers if the ones you have can’t deliver. SMBs that suffer even a few hours of downtime will lose customers and productivity fast, and at a high cost. To calculate the potential costs of lost business, see “How Much Downtime Can Your SMB Afford?”

In 2010, 30% of channel partners offered SaaS-based backup and business continuity solutions (AMI Partners U.S. SMB Channel Partners Annual Overview). But since then, technology has been introduced that enables MSPs to provide an affordable, all-in-one, cloud-based backup, business continuity, and disaster recovery solution to their clients. SMBs’ increased sense of need and the availability of the technology will drive more SMBs to adopt business continuity solutions in 2012.

3. Increase in MSPs and managed service offerings

As SMB demand for cloud-based backup and business continuity technology increases, so will the demand for managed service offerings. For most SMBs, it makes sense to pay a monthly fee to have all or some of their IT services taken care of so they can focus on their core business. And for many VARs, the allure of recurring monthly revenue will compel them to try adding managed services to their business model. Some predict this increased competition for managed service clients will lead to consolidation of MSPs. While some of that is bound to happen, there’s still a massive market for those who want to offer managed services for data storage and business continuity. The managed service model brings increased revenue, deeper customer relationships, improved defense against competition, and a greater return on invested capital. It’s a win-win for the customer and the provider.

These three trends tie together in a kind of trifecta for channel providers of cloud-based data storage and business continuity in 2012. With the rapid growth of SaaS-based data storage, the demand for and availability of business continuity technology, and the increased desire of channel partners to offer managed services – 2012 is sure to be a banner growth year for those involved in helping SMBs do away with downtime.

Chris Sterbenc is VP of sales at Axcient, which works closely with MSPs. Monthly guest blogs such as this one are part of MSPmentor's annual platinum sponsorship.

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