Can MSPs Make Money with Managed Hosting?

Can MSPs Make Money with Managed Hosting?

March 3

According to a recent report, the web hosting industry, which generates roughly $11 billion a year in the U.S. alone, has experienced an annual growth rate of nearly 11 percent from 2009 to 2014. It says the industry should see continued growth as more companies look to get established online. There is plenty of the pie to go around, and the very nature of hosting makes it a potentially good fit for managed service providers.

Web hosting becomes extremely attractive when packaged as a managed service. Instead of dealing with configurations, updates, security, and all the challenges that come with maintaining a high volume website, companies simply focus on running the business and growing their web presence. MSPs can offer these white-glove services on a small or large scale and make hosting a top selling item in their portfolio. Here’s how:

Set Some Goals

IT firms eyeing hosting as a service should start with some goals in mind. What do you want to accomplish? You can aim high and wide with a service that is open to all, or limit your focus to a specific market. Maybe you just want something to offer existing clients in need of a website. In this case, hosting could be an anchor that convinces them to stick around when it comes time to renew their contract. Identifying some core goals will help you determine how to go about getting your big break in hosting.

Plot an Entrance Strategy

Like the web hosting consumer, MSPs have several ways to captitalize on the web hosting bananza. Let’s take a look at some of the most common options.

Reseller. Consider this the basic entry point. As a reseller, you have the luxury to service hundreds of clients, who can provide with space for a website, a specific set of features, and control panel to manage their own accounts. While you’re generally limited to what’s included in the reseller package, you can offer customers the resources, features, and more importantly, the price you want, with no laborious server management and system administration challenges.

Dedicated server. MSPs can put themselves in the driver’s seat with dedicated hosting. With complete control of the server, you have the flexibility to service an unlimited number of clients, within reason of course, and can allocate the full amount of server resources to their needs. Although you have control, the server is still physically housed in your hosting partner’s data center, who may also offer managed services and special configurations built around your needs.

Cloud hosting. The cloud isn’t the answer for everything, but it can work for service providers looking to tap into the hosting business. MSPs and VARs are both a good fit for the white label solutions that allow existing firms to resell hosting services under their own name from the cloud. These services don’t end at web space, either. Billing systems, support services, and cloud-based Exchange deployments are just some of the options available in white label hosting offerings.

Think About Services and Features

The key to moving packages in an insanely competitive hosting marketplace isn’t necessarily offering a one-size-fits-all solution. It’s about solutions that cater to the right needs. So how do you stand out? Many firms bundle hosting with additional services such as domain registration, web design, and SSL certificates. There’s plenty to choose from, so think about what your audience might want and what you can deliver effectively. Consider the skills, tools, and resources you will need in order to empower your audience with these services and features.

Partner With the Best Vendors

Hosting has changed quite a bit in recent years. Today’s providers can deliver a wealth of services beyond web space from traditional, cloud, and hybrid infrastructures that offer the best of both worlds. The partners you select will have a lot to say about your ability to offer clients a secure, reliable, and highly available environment, so do your homework and be sure they’ve got your back. Reliability and security become ├╝ber important when factoring in cloud-powered tech, mainly because cloud vendors simply aren’t guaranteed to stick around. Not sure who to pick? This brief guide will help.

The hosting business is a great business to be in, especially for the established IT service provider with an audience that will find a need for it. With a solid foundation beneath you, it can be one of the most highly sought after items on your menu of services.

Photo Credit: James Cridland via Flickr