Managed Services: Two Views On the Economy

I attended two different conferences this week, one located in San Francisco and the other hosted in Las Vegas. While one conference was filled with upbeat attendees, the other event was clouded by economic uncertainty.

It was quite literally a tale of two cities -- and two industries. While San Francisco and the broad IT industry worries quite a bit about the economy, attendees at the Kaseya User Conference in Las Vegas were generally upbeat about their business prospects.

I'm not suggesting that the managed services market is immune to an economic slowdown. But Kaseya executives provided some clear indicators that their business remains strong. CEO Gerald Blackie displayed a slide that showed Kaseya revenues growing from about $11 million in 2006 to roughly $25 million in 2007 (those figures are my rough interpretations of a bar chart from Kaseya).

Blackie also said he expects Kaseya to double in size again this year.

Attendees also seemed upbeat, with many established MSPs expecting double-digit managed services revenue growth (at a minimum) this year.

When the Kaseya event wrapped up on June 3, I headed to San Francisco for a private IT event. While speaking with individual attendees, I heard anecdotes about tighter IT spending heading into the second half of 2008, along with some hiring freezes and even some project and staff cuts.

It was a healthy reminder to me that, at some point, cautious IT spending may impact the managed services market. But so far, the MSP industry seems to be holding up remarkably well.

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