Everon recently sold our first Hardware as a Service deals.  This changes things.

Everyone in our industry should be evaluating how they will make Hardware as a Service a core component of their business model.  We’ve been talking about it for a year or two at Everon, but we’ve just recently started really making it happen.

This is largely due to what the guys are doing over at CharTec; they’ve put together a fantastic model for companies in our industry to take advantage of.  We’ll also be taking advantage of the Zenith products as they roll out in 2010.

Why is hardware as a service such a big deal?

Two words: “Stuck” and “Sticky”.

What do I mean by stuck and sticky?  Two important things:

1. Stuck – when you sell a hardware as a service solution to your clients, your services are now “stuck” to the technology – they can no longer be separated by the client.  This is a HUGE benefit to our business; it totally changes our business model and the equity value of our business.  Why?  Because it makes your client base…
2. Sticky – it’s going to be hard for a client to leave one of these arrangements.  They will be making a big financial decision in cancellation penalties to get away from your service, as they will essentially have to pay for the purchase of their equipment and software when they break an agreement with you.  As opposed to managed services, which is pretty darn easy to get out of a contract.

If you are not currently offering these services or actively in the process of figuring out how to, please set a New Year’s resolution to get it figured out before January is done – you’ll thank me for it.

MRC

This is interesting stuff.  HaaS has a ton of potential but has been stuck in the mud for a long time because it is too complicated/frustrating to find the right financing partners.  It looks like MSPAlliance has taken a big step in solving this problem by partnering with Varilease to create a program specifically for MSPs.

Others are doing this as well, most notably MSP On Demand.

An interesting conversation is taking place on this subject over at MSPMentor…check it out here.

MRC

There is an interesting article on MSPMentor today about Cisco’s new per user, per day pricing for their unified communications product line.  Very interesting stuff!  Everybody is seeing the value of offering products and services in a way that is easier for the masses of small businesses to gain access to.  Man…it’s a good time to be a small business!

Anyway…back on topic.

In the article author Joe Panettieri mentions that some members of the msp community are crying foul when it comes to HaaS, saying it’s really just the industry trying to dress up leasing in sexier clothing.

I disagree, and I think customers will disagree as well.  I say this for one simple reason:

My definition of HaaS includes hardware replacement as an integral part of the service.

That may not seem like such a big deal on the surface, but I think it is.  Consider the small business that buys the laptop HaaS from Everon, a provider of small business IT support services.  Six months into the service their laptop craps out and they think, “Oh not again,  this will probably take a full week of downtime to get replaced”.  And if they had bought that laptop direct from Dell, it probably would take a week with all of the time necessary to justify getting parts replaced, rebuilding the laptop, loading personal settings, etc.

But not with the Everon laptop HaaS service.

In this case, Everon would have a spare laptop on hand and would keep an image of the proper user configuration on our servers.  We would image the spare laptop and have it shipped overnight, ready to go when it arrives.  The user then packages the old laptop in the return box and ships it back to Everon.

No worries about warranty details.

No arguing with the manufacturer about why the computer broke in the first place and who’s to blame.

No questions about who actually owns the computer and who gets stuck with the service-related costs of setting up the new laptop.

That’s a nice service, and you won’t get it with a lease!  But is this a reality today?  Unfortunately not.  At least not at Everon.  We’ve had a devil of a time finding a financing partner that will allow us to do HaaS right.  If you know of one, please let me know!

MRC