Distributors Adopt Different Approaches to Managed Services

Channel distributors have seized upon the managed-service market as a revenue opportunity for them and their VAR customers. Ingram Micro and Tech Data, are taking the market seriously although approaching it differently. (Part two in a series.)

Channel distributors have seized upon the rampant growth of the managed-service market as a revenue opportunity for both them and their VAR customers. Ingram Micro, with its Seismic strategy and Tech Data, with its VARChoice strategy, are taking the market seriously although approaching it differently.

The big difference: Ingram Micro, via third-parties, hosts managed services for its VARs, while Tech Data doesn’t.

Ingram’s position is that hosting applications and infrastructure lowers the barrier to market entry for many VARs and speeds them along the revenue-generation path, said Justin Crotty, vice-president of Ingram Micro's services division.

Crotty said many VARs lack the financial ability or technical expertise to build and manage a 24×7 data center. “Our success in this market is dependent on the VARs’ success, not on the vendors’,” said Crotty.

Tech Data’s strategy is to offer VARs a spectrum of MSP options through Zenith Infotech, without hosting any of them. “By doing this, we offer VARs a choice of managed services and avoid any channel conflict,” said Joe Quaglia, Tech Data’s senior vice president, U.S. marketing.

This May, Tech Data beefed up its managed services with a financing program to help MSPs to finance their services offerings. The program, backed by IBM Global Financing, enables VARs to finance deals worth as little as a $1,000, making it attractive to VARs who provide managed services to SMBs.

For deals under $300,000, IBM Global Financing doesn't require MSPs to submit end-user financials and will provide credit approval and contracts within one hour.

Tech Data’s new financing program is designed to enable MSPs to finance their solutions purchased from Tech Data; structure monthly or quarterly payments for hardware, software and services under a single invoice; and keep track of all financed assets.

Early this year, Ingram introduced a suite of customizable leasing finance options, including one for managed services and expanded field credit resources to help VARs grow and capture more services revenue in 2008. Having access to the right financial services is critical for VARs who want to build their business," said Crotty.

(This is the second article in a three-part series about managed services in the channel.)

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