Cloud Computing and Managed Services Worlds Converge at Industry Conference

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by: Jeffrey M. Kaplan

I was invited to attend the fifth annual ConnectWise Partner Summit in Orlando this past week and was surprised to discover that it has become one of the premier meeting places for aspiring Managed Service Providers ((MSPs)) and industry enablers.

I was also impressed with the amount of attention ConnectWise’s executives, other event speakers and sponsors, and the conference attendees gave to the convergence of Software-as-a-Service (SaaS), managed services and cloud computing.

ConnectWise may not be a household name in the SaaS or cloud computing markets, but it is a key player in the managed services arena. Although ConnectWise calls itself a professional services automation (PSA) provider for IT professionals, its software also helps them manage their helpdesk operations and sales processes.

ConnectWise’s solutions are typically used by IT service providers, including VARs and MSPs, and it has built its success on a highly leveraged partner strategy. Its software is enhanced by and embedded with nearly 3000 third-party developers, vendors and service providers. In fact, the company’s partner strategy has succeeded in permitting ConnectWise’s solutions to support over 32,000 organizations via these partners, with a staff of less than 200. Approximately 40 companies were on display at the Partner Summit, ranging from small, niche players to Cisco (NASDAQ:CSCO), Intel (NASDAQ:INTC), Xerox (NYSE:XRX) and Google (NASDAQ:GOOG).

Google’s presence at this event was particularly interesting. Although the Google representatives were primarily promoting its current Apps capabilities, it was obvious that they were also laying the groundwork for a broader array of cloud-services aimed at MSPs in the future. The attendees I spoke with already see Google affecting their businesses, most notably the organic growth of Gmail which is threatening to commoditize their managed email services.

The treat of commoditization was high on everyone’s agenda and to ConnectWise’s credit they scheduled Chris Anderson, editor of Wired Magazine and the author of the Long Tail and Free, as one of the keynote speakers to discuss the strategies to survive the ‘freemium’ phenomenon.

The company’s co-founder and CEO, Arnie Bellini, has also become an evangelist for the power of the ‘cloud’ and opportunity to leverage SaaS solutions to permit VARs to migrate their businesses to managed services and enable MSPs to survive in an increasingly competitive market. He gave a convincing opening presentation about how rapidly changing customer needs are dictating a migration to the cloud and driving ConnectWise’s SaaS strategy.

He has not only positioned ConnectWise as a partner-friendly vendor, but as a facilitator of industry best practices via a combination of online resources and regional user groups.

He also demonstrated during his opening talk the company’s willingness to admit to its shortcomings by showing the results of a recent customer satisfaction survey which identified areas where it could clearly improve.

It was obvious that his candor and the company’s efforts to improve the quality of its products and services, along with its partnership approach, have won it tremendous good-will in the industry.

As a result, ConnectWise has succeeded in putting itself at the epicenter of the managed services industry and its Partner Summit has become the ‘go-to’ event for many of the attendees I met.

The energy at the Summit reminded me of Salesforce.com’s Dreamforce conference. And like Salesforce.com (NYSE:CRM), ConnectWise is rapidly increasing its partner network by opening up its application program interfaces (APIs) to third-parties. The importance of the partner network as an influential channel to market was reiterated by the company executives who I met from HTG Peer Group, CoreConnex, SonicWall (SNWL) and Reflexion Networks.

Both companies also have bold and candid evangelistic CEOs who see themselves leading a revolution. Marc Benioff has become the poster-child for SaaS and the Cloud. In ConnectWise’s case, Arnie Bellini is becoming the spiritual leader of the “IT Nation” and MSP community.

For me, this event represented the convergence of the SaaS, cloud computing and managed services worlds. The Summit was also further proof that the world is moving rapidly in this direction because these on-demand alternatives are increasingly generating tangible and measurable business benefits for customers and providers alike.