Managed services boom in Oz

Tim Dickinson, country manager A/NZ for Kaseya claimed the success of the vendor is indicative of a change in the way businesses maintain their IT infrastructure.

“There’s a revolution in managed services, specifically the SMB market. The sort we haven’t seen since the development of Dos,” he said.

He explained that the rise of managed services can be attributed to the practicability of the business model. Charging for a particular service per device as opposed to an hourly rate serves the interests of the partner as well as the customer.

“With the old business model, you used to make money when something breaks and the amount you would charge would depend on how long it took to fix the problem,” said Dickinson. “With managed services your goals are aligned with the customers goals because they’re paying a fixed price per month.”

According to Dickinson, partners are concerned about how to service the SMB market. He asserted that Kaseya provides the necessary tools to service this market such as automation tools, remote access and auto patching to increase efficiency.

“It’s a different way of doing business. Traditionally something would break and someone would be sent down to fix it. Now you can service a company remotely and provide a high level of service,” he said.

Kaseya is investing in educating partners via seminars and channel programs. Dickinson refers to ‘entrepreneurial seizure’ where companies fall into a particular sector, but don’t possess the skills or aren’t up to speed with the latest technology to survive in the market. With 2000 partners worldwide and 150 in Australia and New Zealand, Kaseya is focusing on equipping their partners to succeed in the managed services market.

“We want to educate partners on the benefits of managed services and provide the best tools for them to implement them,” he said. “We don’t believe in advertising, we have more faith in results from our partners. When we help someone take a big leap forward, that’s very exciting for us.”

He also adds that there is certainly an incentive to participating in this market in terms of a constant and sustainable flow of income.

“Managed services bring in recurring revenue to our partners, which makes it appealing,” he said. “At the end of the financial year there’s a mad rush to spend on IT, making it the most profitable time of year for most vendors. However, with managed services there is a constant cash flow. There’s also increased profitability because you’re paid in advance.”

Dickinson explained that the current skills shortage crisis may be creating problems for many businesses, but the managed services sector is thriving as it enables companies to grow revenue with the same number of staff. He therefore forecasts continued growth for managed services.

“I see the market growing at a sustained rate … there’s plenty of scope to move,” said Dickinson. “I also see an increase in competition at the top end of town, where the cost of delivering services is high and doesn’t scale back down. For these folks, there will be an increase in competition form small- to mid-tier systems integrators.”

He adds: “It’s great for us because these companies are using our tools and increasing their profitability.”

Kaseya is currently promoting its web-based software that uses the old sales method of 'try before you buy'. The vendor’s unique pricing model allows partners to pay a monthly recurring fee, which is ideal for partners receiving monthly payments from their customers.

“The reason paying monthly works is partners pay for software with the money generated by using it and at the end of the term they own it,” said Dickinson.

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