Spotting the next wave of managed services

Channel pros have rightfully identified the service market as a way to increase revenues and margins. Resellers who get involved in managed services are saddled with the task of consistently developing

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new services to address customer needs. Being creative with services can produce high margin returns, but failure to innovate will harm business. The trick, of course, is in identifying new service offerings in sufficient time to beat the market and satisfy customer needs.

The bad news is that predicting what a customer might find appealing is hard to do. The good news is that the evolution of the IT market generally makes it possible to make informed guesses about customer needs and allows resellers to make a good prediction on services that will resonate with those needs.

Current market trends: The tide is rising

So what is driving the IT market? Four things: convergence, compliance, consolidation and conservation. These drivers are critical to the channel since they will shape the needs of customers, and define the services they buy to address those needs.

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Convergence is important because IT infrastructure isn't just for computing anymore: it carries voice, video, data -- anything IP. Compliance has gained a much larger role in businesses because government regulations are increasingly mandating data security requirements. Consolidation offers new approaches to architect enterprise IT infrastructure upgrades, such as virtualization and SOA, which continue to escalate the complexity in IT management. Conservation is gaining popularity because IT power consumption and carbon footprint issues are being expressed because new government regulations are starting to impact business.

Managed services next wave

These evolving dynamics help define emerging services that managed service providers should begin planning to offer right now. Here are five of the more interesting ones: power management; system and storage resource management; security management; data integrity auditing and management, and virtual infrastructure management.

Power management seems pretty simple, but it is at the heart of the value proposition for Green computing. IT organizations have to worry about the robustness of their computing resources and whether they can get the job done within increasingly strict power constraints. Services that analyze power consumption in data centers and shift processing loads, allowing underutilized machines to be shut down, will have high value for enterprise IT organizations. This need will become especially acute within the storage space as increasingly complex computing become predominant in data storage and retrieval facilities.

System and storage resource management is closely aligned with power management. Resources are managed to provide optimal performance for critical applications. Managed service providers would monitor the application space for the enterprise and proactively assign resources (computing and storage) to ensure reliability and performance.

Security management has traditionally been a passive activity. Security systems were originally deployed to prevent intrusions into the enterprise. Now that security threats are becoming more sophisticated, hackers launch active attacks against IT processes and often succeed in penetrating the security layer. Management services that look under the covers and actively monitor infrastructure traffic, while looking for patterns that indicate unauthorized use, and automatically move to curtail illicit use will become the essential service capability of IT -- whether it is done internally or acquired from managed service providers.

One consequence of compliance and regulatory requirements is the need to support extensive legal discovery in the electronic domain. When discovery is initiated, IT must now be able to track down specific data that pertains to the discovery request. Frequently, this is a time consuming and painful process. As more transactions and communications become electronically stored data, discovery will become an unacceptable overhead to IT operations. Managed storage services that use advanced data mining techniques to discover, retrieve and correlate customer data stores for litigation or regulatory reporting purposes will provide extensive value to customers and provide a high margin business for storage MSPs.

Catching the wave

New architectures are increasing the complexity of managing computing environments beyond most SMB IT shops' capabilities -- and this presents business opportunities for you. For example, virtualization complicates resource, security and data management by introducing virtual machines that can encapsulate complete operating environments, applications and data stores. Potential customers are straining their resources by keeping these functions in-house.


This was first published in August 2007

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