News

IBM Woos Former Enemies with Managed Services Play

• By Pedro Pereira
• March 05, 2012

For years, computing behemoth IBM viewed managed services providers (MSP) as competitors, but that's a thing of the past.

"Many MSPs started with strategic outsourcing, and that was in direct competition with what IBM does for a living," said Andy Monshaw, general manager for IBM global business partners and midmarket. "We never looked at them as a partner, but more as a competitor."

So what changed? For one thing, said Monshaw, MSPs are adjusting their business models. As they have started to add cloud services to their client offerings, he said, IBM spotted an opportunity to partner with MSPs in serving a market where hosted, outsourced and cloud-based services are increasingly welcome.

IBM research shows that midmarket organizations typically have small IT staffs and, therefore, are amenable to contracts with service providers. "They have a high degree of preference to buying from local trusted IT services firms," Monshaw said.

With that in mind, IBM this year is making an aggressive push to recruit managed services and cloud service partners with efforts to educate potential partners about "what we bring to the table," said Monshaw. "So our challenge at the moment is getting the word out in a consistent way."

To get the word out, IBM is focusing on Internet media and MSP-focused events. In addition, said Monshaw, the vendor has hired executives with the requisite experience and managed services sensibilities to run the vendor's MSP-focused organization.

Efforts to draw managed, hosted and cloud service providers to the IBM brand are part of the vendor's Midmarket Application Framework strategy, which also recruits ISVs to develop solutions built on IBM platforms.

Wherever possible, IBM plans to develop solutions with third-party developers to create cloud services that service partners can market to end clients. One example is a pairing of IBM servers, storage and networking hardware with data management software vendor Actifio's Protection and Availability Storage (PAS) platform.

Monshaw said there are hundreds of examples in which application vendors can partner with IBM to provide high-value services through the managed services channel. And even though IBM is partnering with third-party developers for the services, MSPs don't have to use IBM hardware to offer them unless they want to, he said.

Bill McCharen, IT director for MyITpros, an Austin, Texas-based cloud services provider, said that since IBM is focusing on the midmarket, he hasn't, and doesn't expect to, run into the vendor in the market. MyITpros serves small and midsize companies with five to 50 users.

"IBM is getting into the cloud and hosting model because it has to," McCharen said. "It does lend credibility to the model, but I think we are way past the credibility phase and into the implementation phase. IBM had to do this because the future of computing is in the cloud and they know that."

Charles Weaver, president of the MSP Alliance, said IBM understands the managed services channel. "The fact that they are targeting the midmarket, and doing so by recognizing the need of MSPs to reach that objective, is a testament to their understanding of the value of managed services providers," Weaver said. "Because the midmarket does tend to care about brand names, having IBM involved as a strategic partner will help those MSPs be more effective in their approach."