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Q and A: The GFC was a good thing for MSPs, says LogicNow

Chris Player | Sept. 9, 2015
LogicNow general manager, Dr. Alistair Forbes, has watched the MSP movement grow from humble beginnings to the widely adopted partner model it is today. Here, he discussed the evolution of service providers and what the company is doing locally with partners.

LOGICnow general manager, Dr. Alistair Forbes
LogicNow general manager, Dr. Alistair Forbes

LogicNow general manager, Dr. Alistair Forbes, has watched the MSP movement grow from humble beginnings to the widely adopted partner model it is today. Here, he discussed the evolution of service providers and what the company is doing locally with partners.

You have a lot of experience in the MSP space globally. How does the market in A/NZ compare to the US and EU?

If you look at all the western markets, including A/NZ, they have all gone through an evolutionary process where the managed services model has become the one many reseller businesses are aspiring to adopt because it gives them that recurring revenue stream that is beneficial in terms of cash flow and helps manage internal operations more effectively.

The move of those companies to become service-based as opposed to reseller-based has been pretty consistent across the UK, US and A/NZ. There are tiny differences between the markets, but Australia is pretty well developed in that regard.

The market in Australia is very much mature now in terms of managed services, there are some very substantial businesses operating that model. There is still always an influx of new entrants into the market as well so it’s still a growing market overall.

One of the things that has helped drive that was the international crisis in 2008, it had the effect of encouraging small businesses to try and trim costs and headcounts and so they are more likely to outsource their IT. So, although the economy as a whole was not in great shape, it has driven a growth in the managed services market.

Do you think a lot of this growth has come from the SMB market?

As far as our customer base is concerned, that’s who they are servicing. You still have those large enterprise businesses that will still look for a large outsourcing deal, but our customers are mainly focussing on the small to medium sized segment.

At the lower end of that there are businesses that have no internal IT department, but in some of the larger organisations have some form of internal IT resource but they don’t necessarily cover all of the skill sets or all of the IT requirements necessary.

So where are the big opportunities for MSP’s going forward?

The move into specialisation in managed security services is one of the big opportunities for service providers to grow their businesses. It helps them get into the larger organisations as well because rather than simply doing the commodity type outsourcing for those businesses they can focus on the security side.

 

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