Managed Services Market Is Booming

But, often, VARs are unprepared for the reality of switching roles. Many lack the business expertise and technology infrastructure to move from a manual to an automated service delivery model.

Small VARs eager to tap into the managed services market, but leery of high upfront costs are the main customers of Do IT Smarter, a San Diego-based MMSP.

Do IT Smarter offers a low-risk, pay-as-you-go MSP program that incorporates key services such as remote monitoring, enterprise help desk, email and internet security, and remote backup. The program gives VARs the opportunity to sell a suite of managed services for a monthly fee that starts at $299 after they pay a sign-up fee of $1,999.

The sign-up fee includes training that helps VARs learn about managed services, how to succeed, and how to tailor managed services to their business, said Don Begg, the company’s CEO.

Begg added that VARs receive technology training and learn about establishing SLAs, marketing, collateral, pricing, help desk, contracts, and selling their services.

“In return, VARs gain the opportunity to earn between 30 and 60 percent margins,” said Begg.

Managed Services Will Grow More Critical to Channel

Demand for managed services will rise for at least the next two years as businesses seek to control costs, but channel partners will need to sharpen their execution and sales skills to capitalize on the managed-services trend, according to a new research report on the managed services market from Forrester Research.

Faster technology change, an impending long-term growth cycle for IT investment (despite the current economic downturn) and the increasing cost of capital will drive many businesses to managed services, wrote Forester analyst Henry Dewing in the report entitled “Market Overview: The Broad Opportunities in Managed Services.”

Dewing identified four major managed-service categories in the report – IT infrastructure, network and telecom, applications and security – and noted that such services can be offered either on-site or as part of a network. Telecommunications has emerged as a top managed-service area as businesses increasingly seek to minimize IT management and costs and instead focus more on their core business processes.

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