Advice For A New MSP: Rediscover The Profitability Of Projects

By Geoff McQueen, CEO, AffinityLive

Fifteen years ago, the margin pressure faced by VARs by the success of Dell's direct online sales model (and the many others that followed) created the conditions for the evolution of the IT industry from the VAR to the managed services provider (MSP) — transitioning from making retail margins to a recurring revenue model with aligned interests was an exciting salvation for many IT businesses and professionals around the world.

As is the way with the tech industry, change is rapid and reliably disruptive, and in the last few years the cloud has moved through the hype curve and is now firmly based at the heart of the tech industry. Similar to how the rapid commoditization of hardware created margin pressure for the industry two decades ago, the cloud is doing reshaping the MSP industry today.

After working with hundreds of MSPs and with the perspective of the heart of industry innovation here in Silicon Valley, here are a few observations for new (and old) MSPs looking at what rapid change of the next five years is likely to bring.

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