There is an important but subtle distinction between delivering cloud computing services and having a cloud services reseller business model. The former actually delivers a cloud service while the latter resells another's service, often acting as a billing agent or performing other "intermediary" types of services. This should not imply that mature MSPs do not resell cloud services because they do. I know many mature MSPs providing their own services, who also offer products like Google Apps, Office 365, and other types of public cloud solutions as an extension of their other "in house" offerings. Why do they do this? To have a diverse solution offering for their customers.
Despite this reality, however, there is a major misconception about being a cloud computing company and there is a lot of miscommunication being directed at MSPs trying to convince them to become a cloud services provider (CSP). Sound confusing? I'll explain.
Back in the day of Value Added Resellers (VAR), the big issue was to migrate or transform your VAR business into a managed services practice. Now, ask any VAR who has transitioned into managed services and they'll likely tell you it wasn't an easy thing to accomplish. There are processes that need to be developed, new tools integrated, existing customers need to change the way they interact with the provider, and the list goes on. The point is, the VAR to MSP transition process is meticulous and must be executed with some amount of precision in order to be successful. But, what about the MSP to CSP transition process?
In my opinion, there is absolutely no need to change your business model if you are already a MSP and want to be in the "cloud" business. Unlike switching from a VAR to MSP, managed services organizations already have documented processes, efficiencies and scalability with their services, and have adopted and thrive on one to many relationships that produce recurring revenue. What additional business model changes would a MSP need to implement to deliver cloud services?
Certainly there would be technological changes required but there is no need for a fundamental transformation of the service provider business model. Cloud services is the same as managed services! Now, this is an opinion of mine that I intend to test at this week's MSPWorld conference in Orlando. While there, I will seek out the opinions of MSPs who deliver cloud solutions today and see if they felt there was any "business model" shift required. I'll keep you posted on my findings and, of course, welcome any feedback from you MSPs out there who have an opinion on this matter.
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