Breaking News from XChange 2017!


Most stories coming out of Washington DC carry subject lines like “breaking news” and “exclusive.” Sadly, most of the stories that follow aren’t very encouraging. Well, this story is different.

I’ve been going to The Channel Company’s XChange events since 2010 and have always considered them a great resource. Not only is the content from the various stages relevant and applicable, I’ve formed some really great friendships in the industry. Conversations with those friends–in hallways, elevators, the lobby, over a meal–have informed so much of the way I think about the market and my strategic approach.

This year, a team from LogicMonitor descended on our nation’s capital for XChange, and for the first time, I was there as a vendor. While that role reversal was a big change for me, I still got to spend considerable time talking with industry leaders, and some themes emerged from those conversations.

Breaking: Industry trends overheard at Xchange!

Trend 1: Automation
Trend 2: Moving “up the stack” and differentiation
Trend 3: What to do about public cloud?

Trend 1: Automation

As SPs plan to scale their businesses, they are looking to automate repeated processes and steps. Whether that’s onboarding (automated new account setup) or general support (automated user resets) this trend is a result of MSPs looking to do more with the same people.

Automation can be tricky, however. Several SPs told me that if you over-rotate on automation you can inadvertently automate the handling of issues that are symptomatic of a larger problem. This can lead to a preventable catastrophic event that would have been recognized, had the issue resolution not been automated.

Trend 2: Moving up the stack and differentiation

Talking to MSPs, there is a desire to move up the customer stack. Quite simply, end user support is consuming way too many resources for the MSP and they are struggling to differentiate their service from others. Savvy MSPs are looking for ways to move up the stack and get out of end user support where possible.

I spoke to several providers that are moving toward a co-managed solution with a dedicated onsite resource–oftentimes employed by the MSP–that provides end user and light application support. Meanwhile, networking, servers, storage, connectivity, cloud, etc. are managed by the MSP. This is an innovative strategy, and it seems to be gaining traction.

Trend 3: What to do about public cloud?

This has been, and continues to be, a hot topic. Service providers are performing an increasing amount of work in the cloud, but the work is mostly project-based. Very few providers have cracked the code to build recurring revenue streams with the public cloud providers. Those that seem to have figured it out are taking “raw materials,” like storage, from the public cloud providers and creating a “finished good,” maybe an archive service, that they can package and take to market. This approach can be very lucrative, but it’s difficult to engineer and architect, not to mention market and sell; but as with many things, doing the hard things well has rewards.

Last week was a great reminder that there are some tremendously successful service providers that are doing some really awesome things in the market. There is also, still, a great deal of uncertainty about which is the best path forward. As I’ve heard said many times, “Uncertainty equals opportunity…for someone.” This maxim rings very true. The question then becomes, “Are you that someone?” Are you going to take this uncertain market and use it to get better? I hope so. Let me know how we can help.

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