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Welcome to the MSP Radio newsletter, catching you up on some stories you might have missed!
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New Channel Data from Forrester
From Monday, May 11th's episode: Forrester research’s Jay McBain has released a note indicating that there is a 60% chance of a low-growth recovery extending into 2021.
Also from that blog, in that scenario, 25% of channel partners will experience unrecoverable financial distress. Even in the most positive projection, which is at 30% probability, upward of 10% of providers will experience that unrecoverable financial distress.
Why do we care?
Unrecoverable financial distress. A nice way to say “out of business”
In the editorial yesterday, I laid out my prediction of an L shaped recovery. I did so before having parsed this report which just reinforces that prediction.
The data is pessimistic. My theme is still pragmatism – you need to hold the negative outlooks in your mind and deal with the reality of the situation while at the same time being optimistic for an eventual outcome. That is quite difficult to do, and so the reinforcement of the message is part of its power.
I’ve now done several longer pieces here on the podcast and the Youtube channel on this.
I’ll keep reporting on the data as it come in.
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All that matters is what the customer thinks
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How do you predict now what customers may do? How do you get an intimate understanding of your customers right now with so much uncertainty? What can we learn from the mistakes of how solution providers are handled by their channel partners to make sure we are successful predicting the future?
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Kaseya, IDC and IDG
From Tuesday, May 12th's episode: Kaseya has released their latest MSP Benchmark, and unsurprisingly, security is the number one priority. 95% of respondents said their customers turned to them for security plans and best practices.
37% of respondents felt their MSP business was more prone to cybercrime than a year ago. The research also includes some data about pricing and compliance trends.
Meanwhile, IDC has updated data, expecting IT spend to drop by 5.1% as a baseline, and a pessimistic figure based on the recovery not happening in Q2 but instead persisting throughout the year. In that projection, spending decreases somewhere between 7 and 10 percent.
And in IDG data on managed services focused on enterprise, those who are outsourcing less work (in the 25-50 percent range) are expected to step that back, and companies outsourcing more than 50% would increase that. That survey also reinforces that organizations are turning to service providers for help with security.
Why do we care?
Let me start by saying I didn’t dive into the pricing data because I’m not finding a ton of value in having more pricing discussions around managed services. That’s my perspective there.
The security prioritization should be no surprise.
The IDC data is one more data point to the theme – plan for an L shaped recovery. I’ll keep saying it because I don’t think repetition is bad in this case. All the analysts are saying the same thing.
The IDG data is notable for its reinforcement of this: The pandemic is acting as an accelerant to trends. If you’re uncertain what is happening, you can safely assume that any trend from before is accelerating.
Security remains an opportunity area, plan for a slowdown, and trends are accelerating.
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Twitter may never go back to work
From Wednesday, May 13th's episode: Yesterday, Twitter made a bold proclamation: Most of its employees will never have to go back to the office, if they don't want to.
Other tech companies are starting to give tentative schedules for when they'll be back in the office. Here are those plans.
- Apple: Already beginning to bring some people back to the office, with larger offices starting to fill up in late May and early June.
- Google: Planning to start opening offices in June, but told most employees to expect to work from home until the end of 2020.
- Facebook: Will open most of its offices starting on July 6th, but also allowing employees to work from home through the end of the year.
- Salesforce: No specific date recently but CEO Marc Benioff just told Axios, "I hope that actually we're weeks away from that and not months away from that."
- Slack: Not planning to fully reopen offices until at least September 1.
- Amazon: White-collar employees who want to can work from home until at least October 2. It's not clear when offices will first start to open.
- Microsoft: No date for office openings yet, but work-from-home is allowed through October
Why do we care?
These dates are useful to get insights into what these companies are thinking about for when they reopen – from never to June. I’ve covered office space and planning resources in the past two days, so offer this as a resource for thinking about physical office space.
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