As the opportunities in managed services and software as a service (SaaS (News - Alert)) domain increase, Channel Partners (CPs), focusing on selling to SMBs (small and medium businesses, or companies with up to 999 employees) in the United States, are gearing up their marketing efforts to make a mark in these fields. An AMI study states that SMBs are expected to spend $1.6 billion on SaaS in 2008.

 

For Channel Partners who have lost a significant amount of money due to shrinking hardware margins, hosted and managed services represent an opportunity to recapture some of the lost profitability. AMI expects these services to grow at a healthy double-digit rate over the next five years. The managed services are being offered by roughly four-in-ten of the core SMB CPs in the U.S. at the moment. The agency expects significant growth in managed applications, storage and security as network administration and management are the most common services offered today.

 

MAI states that SMB CPs have traditionally been quite diversified in their solutions offerings. They offer about 20 different products and services to their clients on an average. But the mergers and acquisitions and the emerging managed services model have made the vendor partnerships a more viable option and the shift towards consolidation is all the more evident.

 

As many SMBs do not have enough staff or skill to manage their IT environment, the managed or hosted model comes across as an attractive alternative for these companies. It allows them to focus their energy and resources on their core business operations by outsourcing certain IT functions to an expert.

 

“Managed and hosted services are a good fit for SMBs for several reasons,” said Avinash Arun, senior associate at AMI, “With the economy slowing and finances a key concern, US SMBs are looking for ways to maintain current levels of operations and efficiency without spending heavily on equipment, complicated training, and new IT staff.”

 

Other SMB-relevant benefits of managed services and software include the elimination of large capital outlays, predictable cash flows, and shorter deployment windows. Managed and hosted services are a good fit for SMBs for several reasons. With the economy slowing and finances a key concern, U.S. SMBs are looking for ways to maintain current levels of operations and efficiency without spending heavily on equipment, complicated training, and new IT staff.