From The Editor | July 20, 2009

Market Overview Shows Break/Fix Filling the Gap For Some VARs

If you like the facts and statistics found behind the scenes in any industry, check this out: OnForce has just released its OnForce Services Marketplace Index (OSMI). Based on more than 70,000 service events this quarter across North America, the OSMI provides a comprehensive overview of key spending trends in IT and consumer electronic services. Pete Cannone, CEO of OnForce, (which provides an online marketplace through which IT providers can contract with other providers to expand their portfolio of technology offerings, fill in staffing gaps, or grow their geographic footprint) shared some highlights from the report with us last week. He notes that while the economy still remains deflated, there are pockets of good news. “We did see prices start to stabilize at the end of Q2; there was tremendous pressure downward before that,” says Cannone. “Now, those prices seem to have hit the threshold where they won’t go lower.” He explained that while the marketplace remains busy, many of the projects flowing through the OnForce marketplace are break/fix oriented. The reason? MSPs have been busy with services, and are outsourcing the break/fix work to subcontractors while traditional VARs are reverting to break/fix projects because there are few large projects out there. “In this quarter, spending in the break/fix sector — from diagnose and repair to parts swap — remained high, accounting for 63% of all work orders,” says Cannone. “In the past few years, VARs sort of shied away from that break/fix market, but now they need to be in it to stay entangled with their clients since that is about all that is out there right now.”

The entire OSMI Q2 2009 report is available for download at: