Cohesity adds consumption-based pricing to MSP program

Cohesity offers partners the ability to use the pricing model preferred by most service providers, as they expand their MSP channel both upmarket to large telcos and downmarket to MSPs who serve the SMB and midmarket.

David Kosman, Head of the Service Provider Business at Cohesity

Today, Cohesity is announcing the addition of consumption-based pricing for their data management services for their managed service provider partners. It gives MSPs the ability to pay only for the data management services they use each month, rather than paying for set blocks of capacity in advance.

The Cohesity managed service provider program itself is a year and a half old. David Kosman, who had been Director of Cloud Service Provider Strategy at Hitachi Vantara, was hired by Cohesity as Head of the Service Provider Business in January of 2018 explicitly to build the service provider program out. Cohesity officially launched the service provider program in October 2018.

“We are approaching a network of 100 service providers across the globe in under two years, with almost 100% quarter over quarter growth during the last several quarters,” Kosman said. Growth was 100% from the first to the second quarter of FY 2020 and 87% from the second quarter to the third quarter.

Since the program’s early days, the partner profile has broadened out.

“Initially our strategy focused on some of the large national providers, like Expedient, which has 11 data centres, as well as Canadian companies like TeraGo and ThinkOn,” Kosman said. “We have also seen large global SIs adopt us and deliver us as services to large enterprises, and in some markets we are starting some of the big telcos. So from the from medium and large nationals, we are getting to the big global guys – as well as ones who serve SMBs, like whoa.com.”

When the program launched the pay per use model was not originally part of the package.

“With our scale-out capability, they could buy only what they needed, but they clearly wanted to see this pricing model at some point,” Kosman said. “It has been in pilot for three quarters.” He noted that as Cohesity built its multi-tenancy using eight early service provider partners as a model, they have also taken pay per use concepts from existing close partners.

“This pricing model is only for service providers – organizations with a NOC, that know how to recognize revenue on an MRR basis,” Kosman said. “It’s based on a monthly minimum commitment on an annual term, and starts at a very low $2000 a month. Of course, as you increase the amount you buy, you get a better price.

“We also give service providers a ramp-up period where they just pay on annual usage,” he added.

Kosman emphasized that the real key to success in the MSP market is collaborating with partners to co-create differentiated services.

“Our strategy is to make sure these are customer-focused and partner delivered,” he said. “To me, the value of a service provider channel is building services that together we can extend to our customers. So the task with partners is how do we best help them co-create services. We have invested in workshops, including ones in the Canadian market, to help develop these. It’s too hard to compete with me-too services. The issue is how to leverage our platform so that everybody wins.”

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