NEXTDC Strategy Guide MSPs turning to colocation partners for cloud ventures

MSP Cloud Strategy

As margins for hardware and software continue to fall, many resellers are moving toward providing services to stay profitable.

Through the deployment of managed services, catered towards the SMB sector, partners are becoming increasingly aware of the benefits associated with building a MSP business, yet struggle to cement a complimentary role within the cloud migration process.

From Optus’ perspective, Smith believes partners can add value by assisting customers in navigating the on boarding process.

“Optus has advisory transformation and managed services offerings, from planning to implementation, and they play crucial roles in adding value for the customer,” he explains.

“To be complimentary to a cloud strategy, partners must understand the customer’s business and make sure that translate into the plan and execution.”

Specific to the channel, Smith believes a change of tact is required for partners selling cloud solutions to SMBs, cautioning against a “one size fits all” approach to the market.

“What appeals to the SMB market with regards to cloud is different compared to enterprise,” he adds.

“There is a willingness among Australian SMBs to innovate and try innovative solutions to business problems, and that warrants a different approach from partners.”

But as tech-savvy SMBs push the envelope in terms of innovation, the role of the MSP heightens, creating an industry caution from the channel due to technological and business model changes, and the subsequent costs and resources required.

To combat such concerns, and the perceived cost barriers to building a cloud managed services practice, MSPs are turning to colocation providers for scalable, high reliability data centre deployments.

“Take players such as NEXTDC for example,” Wayland adds. “They have figured it out in terms of making it easy for the channel to be able to set up customised offerings for customers.

“NEXTDC are helping to change the data centre landscape and making it easier for MSPs to be able to get a foothold.”

Mutually providing cost savings for customers, and greater margin for partners, Wayland believes the colocation approach is allowing MSPs to compete at a higher market level, without heavy upfront expenditure and investment.

“There has been a maturing of that managed services offering and companies are becoming more comfortable with it,” Wayland adds.

“The pricing models are becoming better understood by the partners and those with some perpetual business as well as annuity.”

By eliminating the need for equipment, management resources and staff, SMBs can utilise colocation providers and partners to cut costs and streamline the company’s business objectives, as the focus shifts away from data centre operations to innovative go to market strategies.

While cost savings, data protection and security remain key colocation benefits - alongside scalability and power redundancy - the ability to allow companies to focus on actually running the business, rather than keeping the lights on, is proving the chief asset for SMBs.

Since expanding its relationship with NEXTDC to offer the full suite of enterprise cloud, data centre and IP network services, Smith says MSPs are turning to colocation providers when setting out on strategic cloud ventures.

“The right colocation partner is key to any cloud strategy,” he says. “The choice of connectivity and access to multiple cloud providers is what our customers demand.

“How MSPs can best utilise colocation partners is to leverage the huge investments they have made to get themselves on a level playing field without breaking the bank.”