As an MSP, should we build our own cloud or resell someone else's?

As a midsized managed service provider (MSP), how should we decide whether to build our own cloud services or to become a partner and resell/bundle someone else's?

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Time to market is a general consideration when developing a cloud migration plan and making investment decisions. Generally, a good initial strategy is to minimize upfront costs by leveraging another provider's infrastructure and using value-added services to increase your average revenue per user (ARPU) -- at least until you've proven yourself to the installed base and you have the revenue to justify the investment in infrastructure. 

Depending on available offers from partners, look for a lower-margin offer with an option to build, operate and transfer to your infrastructure when the profit-and-loss statement makes sense. For your initial steps into the cloud market, it is often easier to first train just your sales team to be cloud resellers; when the time is right, migrate the infrastructure and delivery team after you have established an installed base.

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This was first published in February 2012

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