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MSP business trends, from e-waste to virtual warehouses

MSP business trends expected to take off this year include industry-specific AI opportunities, an uptick in cloud-native development and the near-constant need to update employees on emerging technologies.

Fields such as computer vision, multi-cloud deployment and corporate IT training are poised to rank among the key themes for managed service providers (MSPs) in 2020. But those won’t be the only notable developments. Here are a few other items to keep on the MSP business radar:

E-waste as a channel opportunity

IT asset disposition isn’t new and some channel partners have been working with customers to safely rid themselves of out-of-date or redundant servers, storage devices and other equipment. What is new is a growing interest in sustainability efforts amid a global glut of e-waste.

Blancco Technology Group, a data erasure technology company based in Austin, Texas, contends the world faces an e-waste crisis. Christina Walker, global director of channel sales and partner programs at Blancco, citing World Economic Forum data, noted the current 50 million tons of e-waste produced annually could rise to 120 million tons by 2050, unless efforts are put in place to stem the tide of digital detritus.

E-waste is receiving regulatory attention. Walker cited the European Union’s energy-related products regulations, also known as Ecodesign, which she said are “serving as models for similar laws and regulations” in the U.S.

The upshot for service providers is an opportunity to help customers sell or recycle their unwanted IT assets and cleanse equipment of any lingering data before disposition, Walker noted. Partners might find new revenue streams in this process.

Distributors as cloud purveyors

Distributors have served as physical warehouses for channel partners for years, providing a range of hardware and software products. The rise of cloud computing, however, is changing the traditional distributor business model.

A report from the Global Technology Distribution Council (GTDC), a Tampa, Fla., consortium that represents tech distributors, points to “virtual warehouse” services as the future of distribution. GTDC-commissioned research polled MSP business firms, solution providers, emerging technology companies, original equipment manufacturers, venture capitalists and end customers. Respondents projected virtual warehouse support for SaaS and cloud offerings as distributors’ top supply-chain capability in 2025.

That said, respondents to GTDC’s Tech Distribution 2025 survey also suggested distributors’ traditional services — such as integration, logistics, inventory management and asset lifecycle — will continue to prove important.

Distributors already have made some headway into the cloud, offering specialized marketplaces and clusters of cloud offerings around platforms such as Microsoft Office 365.

Ripple effects from CCPA

The California Consumer Privacy Act (CCPA), which went into effect in January, will influence the MSP business this year and beyond. Industry, for starters, can expect to see litigation. “The legal system in the U.S. will precipitate some high-profile cases involving [CCPA] in 2020,” said Nigel Tozer, solutions director EMEA at backup and recovery vendor Commvault, based in Tinton Falls, N.J. Tozer noted CCPA doesn’t permit class-action suits, but added a successful case will have a knock-on effect, creating an opening for “high numbers of plaintiffs.”

Blancco’s Walker pointed to another possible CCPA ripple effect: the emergence of additional state privacy laws. “We expect other states will likely enact similar privacy legislation, so MSPs should be prepared to help their customers that must comply with new regulations,” she said.

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