The managed services guiding light

Interview with Kaseya President, Mark Sutherland, and CEO, Gerald Blackie

The managed services trend has become a beacon of revenue light in the economic storm and those already in the game are travelling well. TREVOR CLARKE caught up with Kaseya president, Mark Sutherland, and CEO, Gerald Blackie, to talk about the vendors plans for the market and the possibility of picking up smaller companies.

What are the plans coming to Australia and what do you hope to achieve while you are here?

Gerald Blackie (GB): We are looking to continue our growth down here. We are proud of the fact that Tim [Dickinson, country manager] and the team have done a tremendous job in building our presence. We are in the process of growing our MSP [managed services platform] business and beginning the process of growing our enterprise business at the same time. We are in advance of a number of new initiatives being announced at our user conference, but part of the process is understanding what people are doing here.

One of the growth areas in the market despite the economic climate is managed services. We have all seen the move from CapEx to OpEx and it is a pretty well known story, how do you see what is happening overseas as compared to Australia on this?

GB: It is pretty much the same, particularly in the Western world. Australia and New Zealand are very much up there with the US and Canada. Some of the European countries have adopted it fairly early, like the Netherlands. But there are countries like France and Germany that are not there at all yet. If I look at the Australian market, everything I see that is going on in managed services, it is exactly in parallel with what we see in the US.

Are there any market segments you see having more uptake than others?

GB: On the enterprise side, we tend to focus a lot on things like higher-end healthcare and there are a number of verticals we do well in even with the downturn in the economy we have experienced both here and around the world. But the core area we play in today is IT service providers and they are our number one vertical. If you take the enterprise aside and just look at IT service providers that is a vertical in itself, even though IT is fairly horizontal. And how they move from break/fix into people-oriented IT in that small to medium enterprise space, without managed services they are struggling. If they are deep into managed services now, or doing IT automation in a way that we would suggest they do it, the results have been stellar. They are making great profits and we have so many examples of customers that have written to us and said, without managed services they would be in deep trouble.

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You rolled out your technology roadmap in December last year. How is that proceeding in the fi rst quarter of the year. Are there any plans to review it or is it all guns ahead at this stage?

Mark Sutherland (MS): It is pretty much all guns ahead for us. 2009 is a pretty strategic turning point for our vision of where the managed services space goes. At our user conference at the end of May we are rolling out our next big upgrade in our framework version six. But it is really a continuation and expansion of the themes we have been having all these past years. In addition to that, we are bringing on a very high level service desk, service management, and all these kinds of modules that let pretty much any size service manager compete with the very largest global enterprises at any level. So that is really our focus for this year and we are tracking that roadmap.

GB: We’ve been investing very heavily for the last four years in all of the things Mark was talking about and they are all slated to come this year.

In terms of the market, there is a lot of consolidation predicted to happen this year, for you are there any particular areas where you can see yourselves picking someone up?

GB: The reality for us is we have invested so much of our time in all of the things we think are mandatory to get where we need to be in five years that there is probably an acquisition out there to be had, but we haven’t seen one yet. I don’t think our growth is going to be impaired in any way, shape or form by not having a specific target. I think we have most of the bases covered. We are debt free, we are extremely profitable and are continuing to grow every year. We are one of those very fortunate folks that has software that does work and people are finding it makes a big difference to their lives. It is a self-fulfilling prophecy when you have something that works.

MS: To extend on what Gerald said there, one of the visions for this version six framework is to expand an open platform methodology. So instead of us having to go out and do a particular targeted acquisition, we can partner with a lot of other companies to bring that vertical technology to a market. They plug in to our framework and get all the benefits of that mass distribution and mass management without having to redo all their code and that kind of thing.

GB: I suppose we should be very honest. Right at the edges we are doing acquisitions. We just completed one but they are not significant in the context of revenue base and so forth. But they are nice pieces of technology that we currently don’t have that can impact, in a measurable way, customers and prospects’ lives.

As always there is a new phrase in the IT lexicon: Platform-as-a-service (PaaS). Do you describe your own offerings in this way?

MS: The whole IT space is very collaborative in the sense there are people that do quite well in certain verticals. We think we do well in broad-based secure distribution of managed services. So we are all looking to partner. Now platform-asa- service has its ups and downs. What we believe is that service providers, whether they are managed service providers or enterprises, are really in interested in a single pane of glass to manage all their services. They want an appearance, a common look and feel, and very reliable, reproducible effects when they deploy these services. That is hard to do with a marketplace platform solution.