Pointivity Services Delivery in 2009

We would first like to thank all of our customers for allowing Pointivity to serve your outsourced Information Technology needs. For 15 years, we have had the pleasure of interacting face to face with the majority of our Systems Integration and Advanced Hosting customers. These relationships that we have built are the core of the Pointivity values and we look forward to continuing working with all of you in the same manner in the future.

Since 1999, Pointivity has been delivering solutions to our customers that have provided a substantial ROI in comparison to traditional internal IT staffing and capital expenditure. Pointivity gained momentum during the first financial crisis in early 2000 with our offerings and we are now positioned again to leverage our financial knowledge and technology expertise to support our customers through the current economic downturn.

In today’s world, we are certain that you have been bombarded with advertisements and information related to new technologies as well as the news that Corporations must cut costs due to the state of the economy and its effects on all businesses. Server Virtualization, Cloud Computing, Consolidation, Collaboration, Security, Outsourcing, and Managed Services are all buzz words that continue to be used to capture the attention of the cost conscience business owner. All of this information likely leaves business owners and decision makers wondering what they can do strategically that will reduce costs and continue to support profitability and growth while taking advantage of new technology.

The Pointivity technology strategy is simple: never forget the basics, implement only proven technologies, and reduce costs while increasing productivity for the customer.

The Pointivity Outsourced IT Services Platform has evolved over 10 years and consists of flexible offerings that accommodate everything from on-site PC/network support all the way up to a model that provides end-to-end total outsourcing of a company’s IT requirements. Some of our larger customers do not maintain any internal IT staff and rely solely on Pointivity for everything from PC Anti-Virus to custom application development.

When it comes to technology support and implementation, the Pointivity solution carries a significant advantage. Our staff manages and maintains all of the aforementioned technologies on a 24x7x365 basis and has been doing so for the past 10 years. In addition, our staff not only implements a technology or service once and then revisits as needed, they continue to improve the technology implementation each and every day for thousands of end users. Although our services are focused on delivering day to day service and support to our Hosted and Managed Outsourced customers, Pointivity is able to extend this knowledge and expertise to on-site implementations more effectively due to our “always up to speed” culture.

The Pointivity data center architecture is has been designed from the outset taking into consideration shared resources and consolidation, and is now taking advantage of server virtualization technologies which will allow our customers to enjoy the benefits without making any changes to their existing day to day operations or expenditures. New customers and addendums/renewals for existing customers will continue to be implemented using proven virtualization technologies that will allow reduced pricing and enhanced service features such as disaster recovery and increased redundancy.

Pointivity is continuing to enhance its Service Delivery Platform to benefit all of our customers. Whether you are a hosted customer or an outsourced IT customer, we have been adding products that will support your business objectives and/or reduce costs. We have recently introduced some world class product offerings that provide an immediate ROI when they are compared to an on-site implementation and internal with support;

Hosted E-mail supported by Microsoft Exchange Server 2007
Hosted Mobility with Blackberry and ActiveSync Support
Hosted E-mail Encryption and File encryption
Hosted Message Archiving for compliance
Hosted Internet Messaging and Collaboration with compliance and archiving support
Hosted SPAM Filtering with Anti-Virus support
Hosted Internet Content Filtering
Backup and Disaster Recovery Appliance with or without support for Geographical Replication

Parallels Summit 2009 - A Big Success!

Parallels Summit 2009 was a big success this year and thanks to the Parallels team for putting on a great show! Attendees could clearly see why Parallels is becoming the industry leader in this space.

Serguei Beloussov, CEO of Parallels, provided the key note speech to about 1,000 attendees.

Serguei's presentation focused on the latest industry trends and he identified the channel falling into 5 different computing or cloud models.
1) Google Cloud, 2) Microsoft Cloud, 3) Other Platform Clouds (HP, IBM, Apple, EMC, Yahoo, Amazon, Facebook, Adobe and more), 4) Channel Clouds like Pointivity (mass market hosting, Telco, SaaS VARs, MSPs) and 5) In house clouds (large companies).

Serguei noted the keys to partner success are to become a one stop shop, differentiate your product offering and focus on customer and partner retention. Many VARs will not have the resources to support large product lines and it will be important for VARs without hosting expertise to partner with hosting providers who can support and train their staff both on the technology and on how to sell and position these products in the marketplace. Serguei noted there's a huge demand both from customers and within the IT industry for cloud and SaaS computing solutions.

The show included a great set of speakers most notably Morris Miller (founder of Rackspace) and Bill McNee (Saugatuck Technology). Morris focused on the importance of POSITIONING and provided a month by month/year by year historical overview of Rackspace's go-to-market strategies and product positioning strategies. Bill McNee provided in-depth research on the current SaaS industry and provided an end-user / CEO perspective of the hosting industry.

Over 160 companies utilize Parallels Automation and thanks to Parallels team for promoting Pointivity in your presentations!

Another big announcement was the release of Parallels SaaS module which now includes over 200 products that can be delivered through one interface. If you are a ISV or have a hosting solution product, please check out www.APSStandard.org. APS Standard has an open API directly to Parallels Automation engine, allowing any ISV product to be integrated with the Parallels engine. By leveraging this API you can get access to hundreds of master distributors and master resellers worldwide. If you need any help on getting your product integrated with Parallels, please feel free to contact partners@pointivity.com.

The two best additions to APS Standard and Parallels Automation at the show were Global Relay's message archiving and Open Exchange email replacement for Exchange Server. Both products are much needed in the SaaS and hosting industry and offer tremendous value to end-users and companies looking to outsource complex email services on a low cost, month to month, pay as you go option.

Aggressive SaaS deployments in 2009

According to IDC SaaS will grow by more than 40 percent in the current year.

Hardware and software will continue its commodization spiral which will lead to service commodization. The idea is not becoming the low price leader but to be perceived as value for money moving forward in this economy. Today companies are looking closely are the values of their internal staff, aligning current costs with business goals, and evaluating risk ownership. More organizations are willing to evaluate SaaS as an alternative to reduce overall cost via opex versus the traditional capex. As quoted by IDC "right-sized, zero-CAPEX alternatives to on-premise applications."

According to IDC, by the end of 2009, 76% of US organizations will use at least one SaaS-delivered application for business use revised from previous SaaS growth projection which has 73% in 2010 (see below).

All the data points to our partner program approach to SaaS enablement allowing partners to reduce barrier to offer more products, insulate from ongoing changes in IT and position for rapid growth during this economy.

Brand Power: Apple Blowout Quarter Microsoft Earning Plunges

Following yesterday's blowout quarter by Apple, Microsoft announced 5,000 job cuts and decreased earnings today (by 11%). It came in no surprise that EVERYONE should be doing bad; as a matter of fact, high-end brands were expected to be obliterated in this recession but Apple was able to beat expectations delivering blowout numbers.

Last year analysts were skeptical about Apple not having a low-end notebook or even a reduced MacBook while competitors were rushing out with netbooks to target the low end of the market.

Building a brand like Apple is not about volume but intimacy with the customers, a highly targeted relationship with the customer to create brand appeal. Knowing your market and meeting customer demand is where it all starts, the same solution can be sold very differently if you position it properly. Much like how automobile industry positions their brand: Toyota can sell the same Camry for 40-50% more with Lexus badges on it simply because they knew and targeted two different types of buyers.

Microsoft on the other spectrum went for volume (surprise?) and low intimacy thus its revenue and profit rely on mass market adoption. In this model profit margins erode rapidly over time thus new/updated product must be introduced. This is where Microsoft is having issues with their low margin Windows XP being the ideal OS on all the little netbooks (accounted for a majority of the increase in overall mobile PC shipments to U.S. retailers in December, according to the NPD Group. The number of laptops shipped rose 23% to 1.9 million units, with 14% of that growth attributable to mini-notebooks ). Windows Vista is not suitable for netbooks since it needs much more powerful hardware to support it.


The take away? Become the premium brand to your customer regardless of where your market focus is and build strong relationships that create stickiness with your offerings. At the end of the day you're not the only solution provider in town, be creative and maximize the tools and resources (private label) around you.

Tightened budgets making SaaS attractive

Today we honor the birthday of the Rev. Martin Luther King, Jr., and tomorrow we have President Obama moving from the on deck circle to the home plate. However; we couldn't stop more bad news from the banks. Royal Bank of Scotland bites the dust on a massive 28 billion pounds ($41.3 billion) loss, which would be the biggest loss ever reported by a British company, ouch!

So if banks don't and won't lend, business that used to depend on it will have to employ operation cash preservation - CapEx to OpEx mode. While enterprise software vendors are pushing for SaaS contracts, it can benefit the small-mid size VARs, MSPs, and solution providers.

By doing the math correctly on licensing, services and hosting; solution providers can market a value package that makes their customer feel like they're receiving huge discounts. And because of current economic conditions, more businesses are willing to give SaaS a try, employing pilot programs to seek proof of concepts. Pre-sale SaaS trials are good for traditional customers that had no experience with SaaS and if the user experience is great and the price is right why wouldn't they continue?

This is why we developed our partner program around SaaS enablement for partners, reducing hardware and software risks to the minimal while allowing the focus to shift towards business, marketing (brand) and sales. We can't control the shift in technology but we can implement control in our business and that's where the focus should be to deliver IT smarter.

The Empire Strikes Back: Reselling Google Apps

Another vendor has entered the channel with promises and optimism, this time its the search king Google. Yesterday Google introduced their new Reseller Program focus solely on gApps Premier Edition (email, chat, word, spreadsheets, presentations, and security). Until now Google only cooked up the menu to resell Google enterprise search appliances, Apps and Maps to enterprise customers. Key word 'Enterprise' partner program.

And now Google is ready to grow their channel during this economy knowing Microsoft is consolidating with web-based Office Web Applications not ready until 2010.

Google and Microsoft solutions can actually coexist depending on each customer on a case-by-base basis since Google has a slightly different approach to their channel. Solution providers or VARs may even combine the two but ultimately Google App is more appropriate as a cloud-based solution at lower cost than say an on-premises solution from Microsoft. Microsoft is restructuring its channel while Google has just begun, the perfect storm's thunder and lighting.

I am not surprise that Google doesn't having a deal registration because they spend years building their brand and offer free tools directly to customers. So the customers are already trained and used to their brand while Microsoft spend trillions creating products to build a service around their brand.

VARs and solution providers should focus on the business drivers: Continue to foster your relationship with your customers, look for ways to add value to their business, strengthen your brand, and deliver flexible solution (SaaS) that you can build your business on for the long haul. That translates to high customer retention, brand recognition and recurring revenue with real margins!

Margins + Branding + Process Automation = Pointivity's Partner Program

Over the past few weeks I wrote about the changes in the industry and the shifts in perception from IT consultants, vendors to solutions providers. It is easy to see why we've designed the partner program to focus on developing the the weaker areas for VARs: branding, margins, process automation, and product offerings. Here is the value proposition for our program:


Leveraging Pointivity's superior private label hosted services (with storefront!) allows VARs to offer a wide range of products without having to pay for hardware, software, licensing and maintenance.

One of the fastest way to start is to expand your offering to your customers providing a complete set of services such as hosted Microsoft Exchange, SharePoint, Dynamics, and wireless emails to earn additional business process outsourcing revenue.

Majority of the businesses needs emails and offering enterprise email solutions such Microsoft Exchange and Blackberry services creates added value from a cost saving(CapEx to OpEx) and infrastructure management perspective(overhead and risks). If you are able to offer the basic IT needs to your customer, it will create future opportunities for additional services while lifting you towards the trusted advisor role. We're working on additional services such as email archiving or efax to complete the email offering.

Our program includes “on-demand” provisioning automation, ecommerce engine (online store), integrated billing (payment gateway options), and feature-rich control panel for administration and private label control panel for end-users.

Your own private label online store allows your customers to sign up (self-service checkout) then the system automatically provisions and deploy the services immediately. It is all about streamlining your business process while providing a branded solution. As the store grows we will be adding more business essential applications such as accounting, CRM or even dedicated servers to strengthen your hosted services offering.

In addition, the solutions is being offered on a wholesale pay-as-you-sell basis allowing your own pricing structure to adjust to the way you sell. You can sell them in packages or include it in your other solutions such as managed services, backup/disaster recovery or even application hosting depending on how you bundle and deliver them.

The more hosted services you offer the higher chance of customer retention because you’re able to provide a wider range of products while aligning both you and your customer’s overhead to revenue via SaaS. Creating value for your customers is the key for high customer retention and it can be done easily with our partner program.

2009 MSP Watch

An interesting article from MSPmentor with regards to Dell aggressively pushing their managed services.

Joe made some excellent points on the fact that Dell is focused on the mid-market while small MSPs gets the SMB space. There is also the argument that MSPs will do a better job servicing their clients vs big guys like Dell which allows a separation in market share.

It will be interesting to see what MSPs will do once Dell gains more ground as momentum shifts to À la carte service at very competitive prices. Hardware and software will continue its commoditizing path to serve the SaaS model, aggressive direct sales will be the focus as time passes. You can't piss off everyone in one go, but you can break them down so only the strong survives.

Step Right Up: Microsoft App Store Now Selling at a Online Store Near You

Microsoft today launched their first online store in the US (already available in the U.K., Germany and Korea). With the launch, US customers can buy first-party software and hardware directly from the internet. Products include software, devices and hardware, after payments are confirmed, customers can immediately download products and install them right away.

As we continue to see the "going direct" strategies implemented by Microsoft, VARs will need to act rather than compliant in adapting the inevitable - MSP will have a tough time competing against the big daddy (that used to make them money) for what will become the future of the channel, wait a minute what channel? According to ChannelWeb, Allison Watson, corporate vice president of Microsoft's Worldwide Partner Group, made no mention of the Microsoft Store and said that there were plenty of opportunities (hmmm...really?) for VARs to grow, as long as they stay focused on projects that improve energy efficiency, boost productivity and drive down costs.

I wonder what sort of margins can you continue to profit from Microsoft? How long can VARs sustain to this rate of change? Don't you have to survive so you can continue to deliver value?

In addition, they are rolling up the end-user customers with deals like going direct aggressively with 0% finance for Dynamics for 36 months (launched today as well) or the BizSpark program offering Web startups free software before becoming profitable. If any of these pilot programs are wildly successful (which I don't see why not), more products and services will be rolled out with even more aggressive offerings, don't forget even in this recession Microsoft is one of the few companies that's got a ton of cash in the bank, $26 billion to be exact.

You can't fight the trend as VARs or MSPs and you must live to fight another day by transforming your business to deliver IT smarter.

Salesforce Chases After Cloud With Force

Salesforce announced the addition of Force.com, which provides a hosted infrastructure for customers to run websites in Salesforce cloud. They're also going to provide the building blocks to integrate with business applications when everything is available in 2009.

It sounds like they're trying to add value to their offerings via the cloud hype while expanding their product reach further with Facebook and Amazon partnership.

Moving forward, Salesforce will continue to be under pressure from Oracle, SAP and especially Microsoft's new Azure, which is pretty much the same offering. Not to mention Microsoft is working hard to replace SaaS with S+S, it's amazing how Salesforce expects to pass US$1 billion in annual revenue for the first time but its profit margin remains extremely slim.

The IT value stack is getting squeezed by players of all sizes trying to reshape the changing roadmap in IT. As we continue to see acceleration in the cloud hype there is also a fundamental shift in how applications are used and delivered but until the general perception adapts to the cloud idea, I still believe in the hybrid model that will emerge as the real solution to the future of SaaS.