“Man(aged) its Getting Crowded In Here”

The Managed Service space in which Thinsolutions operates is getting increasingly commoditized and downright annoying with a lot of self-proclaimed “competitors”.

Thinsolutions started building its Managed Service (MS) offering in 1999.  Our first MS product was a fully hosted offering which back then was termed an Application Service Provider (ASP).  Today, the new term for this type of hosted offering is The Cloud.  After marketing our hosted (Cloud) offering for some time, we found that some clients weren’t completely comfortable with a fully hosted option.  We accommodated these concerned clients with the more traditional (servers on the client premise) MS offering.  Both the Cloud and the traditional MS support models have been very effective and successful for us and for our clients.

The problem (and annoying) part of the story is that in the last year or two, everybody and their brother now claims  to be a MS provider.  Particularly annoying is that although we have a real, established  track record, better systems and processes, and all of the requisite software tools (monitoring, patch management, trouble ticket system), these newly-formed MS competitors are squeezing Thinsolutions on price.  They can do this because their costs are lower. Why? Because they don’t have the same capabilities/investment in software tools and they are operating without the advanced engineers that Thinsolutions has on staff.  In other words, in most cases the prospect is not comparing apples to apples as it relates to Thinsolutions and these new MS Providers.

All this begs a few questions:  Just how commoditized is the MS industry?  Is this (the pricing pressure) more related to the recessionary economy or is it real commoditization?  And where is the industry headed?  A good recent Blog related to the topic was written by Joe Panettierri who is the Editorial Director for MSP Mentor.  The key take-away is that certain Managed Service offerings are commoditized and “the Proactive talk is old news”.  Check out the article:   http://tiny.cc/k5uyb

For another point of view I called an expert and old friend, the President of the MSPAlliance, Charles Weaver, to get his perspective on the topic.  I have included the audio of my Q&A with Charles.  Click on any of the following topics to hear the audio dialogue:

1. Increase in Managed Service Providers

2. Managed Service Market Saturation

3. How True Managed Services Companies Can Differentiate

4. Thinsolutions Focus and Direction

One thing is for sure, things in the MS industry have changed rapidly in the last few years and that pace of change is only going to speed up in the next few years.  As usual, Thinsolutions will be working hard to stay in the leading edge of these changes.

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