Internet of Things has strong potential for Canadian MSPs: AVG

AVG's commercial market strategy is now based around MSPs, who the company thinks are well positioned to handle the additional management tasks that the Internet of Things is bringing.


Marco La Vecchia, VP of Channel Sales for AVG

While Canada has a reputation of being far from the cutting edge of technology, a new study commissioned by AVG Technologies has found that MSPs and SMBs in Canada are more optimistic than those in other countries that the Internet of Things will make them money.

In the study of 1,770 IT and marketing professionals in the U.S., U.K., Germany, Australia and Canada, the overall numbers indicate 57 per cent of SMBs and 67 per cent of MSPs believe that the Internet of Things will increase their revenues. In Canada, however 76 per cent of SMBs think it will make them money, and 73 per cent think it will create new business opportunities, compared with 67 per cent in all the countries surveyed.

“Canadians, we are told, haven’t adopted services as fast as in the U.S., but when we take a look at specific solutions and technologies, we find Canadians are often at the forefront, and people do incorporate them into their business,” said Marco La Vecchia, VP of Channel Sales for AVG. “We see this as a great opportunity for a new-found recurring revenue stream for MSPs.”

This strong opportunity for MSPs explains AVG’s interest in sponsoring a study on the Internet of Things. While most consumers unfamiliar with AVGs business products likely associate the company only with their downloadable personal Internet security software, their commercial strategy has become focused squarely on the managed services market.

“Traditional break-fix IT solution provider work is hard-pressed because it is virtually impossible for them to compete with a managed service provider,” La Vecchia said. “They must transition their business and become a managed service provider. We want the industry to know that AVG is really at the forefront with managed services, for those who want to get out of the break-fix model.”

AVG’s managed services strategy is based around more than AV, as their acquisition of Ottawa’s Level Platforms in 2013 gave them a strong remote monitoring and management platform, from which they also offer backup and other services through partners.

“The majority of our sales today are cloud based,” La Vecchia said. “In this environment, the Internet of Things is becoming even more important. With all these new devices coming into the industry, it is important for a service provider to be able to manage them. We don’t want our partners being left behind, as the industry changes so much. They really have to move to an MSP platform as soon as possible, or they won’t be able to manage all these new devices.”

To that end the core of AVG’s partner development program is training service providers in tying together business sales and market, and training them in developing pricing models and SLAs.

“The most difficult thing for MSPs is selling and marketing their products, and establishing proper service levels,” La Vecchia said. “We train them how to do that on our RMM platform so they can take both our services and those of other providers to market more effectively.”

So much of the Internet of Things is radically new that solution providers need to become educated quickly about its permutations, La Vecchia said.

“It is already moving to watches, and devices on the bodies,” he said. “One company makes a bracelet for your hand that allows you to control devices like cars and laptops.”

La Vecchia also says partnerships between consumer product vendors and solution providers will necessarily deepen to service the IP equipment.

“When a vendor like LG sells an IP-enabled fridge they will have to work with a service provider in that area who have engineers that understand IP,” he said. “It’s much more complex than hooking up an ice cube maker.”

Canadian SMBs are more confident than those in other countries that their IT provider can provide these services around the Internet of Things. Asked if their IT provider was ahead of the curve on Internet of Things for business, 71 per cent of Canadian SMBs answered “completely” or “slightly” compared with only 46 per cent in the U.S and an average of 58 per cent in all countries surveyed.

Canadian businesses are also budgeting for it. Asked if they had substantial or moderate budgets for Internet of Things, 84 per cent answered ‘yes’ compared to only 50 per cent of Americans and 62 per cent internationally.

“It is increasingly important to own all the devices for a customer, and with the Internet of Things, they will have more than ever,” La Vecchia said. “That provides the stickiness for a service provider, that as a managed service provider, they can support all those devices for the customer. End users want to deal with one provider that can support everything.”

The AVG study was conducted by Vanson Bourne in September 2014, with 1,770 IT and marketing decision-makers of organizations with of 1 – 500 employees from a broad variety of verticals, but excluding the public sector. 85 per cent of the interviewees were SMBS and 15 per cent MSPs.