Eric GoodnessGartner published a Marketscope on Remote Infrastructure Management (RIM) in the second half of 2008. In 2009, Gartner plans a Magic Quadrant on the same topic. However, we’re having some internal debate at Gartner as to whether RIM services is a discrete market, or simply an evolving mode of delivery for traditional change management and improved (proactive) service management.
I’ll admit it - I’m changing my opinion – I believe RIM is a Mode, not a Market. I’ve been working with RIM services for nearly 10 years at Gartner. I’ve also been responsible for Gartner’s forecasts on RIM services for the past 8 years. All along, I’ve strongly believed that RIM services were a discrete market.
Prior to my employment at Gartner, I was the product marketer a number of years ago for Bay Network’s ServiceLink RIM services. If service providers think RIM is a tough sell now… they should have experienced selling RIM services in 1995. Our best successes were follow on contracts cemented after our sales teams integrated core router management as a benefit within aloyalty program we built for Bay’s most strategic customers. It was never profitable in that setting. The principals of the ServiceLink offering left Bay Networks (John Igoe, Robert Klotz and Deb MacCallum) and started Silverback Technologies (now part of Dell). They were trailblazers.
In the late 90s, private equity was pouring into standalone managed services providers (MSP) and life was good. Netsolve (purchased by Cisco) at one time had a market cap of $1 billion on revenue under $50 million. A niche MSP could command significant gross margin rates on their services. They could also live on RIM services alone. Then the bubble burst, customer acquisition models changed and user organizations never really returned to the boutiques.
The days of MSPs are gone because pure, RIM-based MSPs don’t really exist anymore. Most MSPs have been forced by their customers to expand their value. They been asked to sell pass-through maintenance contracts or resell hardware or software or to offer professional services to prop up slumping monthly recurring charges (MRC). In fact in the recent past, the first clear sign that an MSP was in trouble was when professional services revenue grew to more than 50 percent of overall revenue. That’s because an MSPs business plan was predicated on recurring revenue. Professional services are non-recurring. There are a few significant standalone companies providing RIM services but those companies are outliers. IPSoft remains one of the most compelling in the market.
Anyway, I’d like to get the readers of this post to let me know their opinion about RIM services: Market or Mode?
Please reply to this post directly or you can also provide your opinion in this very, very short survey. Paste this link into your browser:
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Category: IT Services outsourcing Tags: hardware resale, maintenance, managed services, network operations center, NOC, outsourcing, remote infrastructure management, software resale, support
7 responses so far ↓
1 Sunil Muthiyan March 9, 2009 at 2:29 am
Hi Eric,
I think RIM is a market.There are companies who would like to outsource their entire IT infrastructure , but can’t do that easily due to fear of data security, control and fear of big change in general.
For them, RIM is a good first step. RIM can reduce their IT labor costs significanly, improve the Service Management Processes (Most providers are ITIL compiant) and provide flexibility in deploying different skill sets as and when needed.
The service provider can sell the Managed hosting and complete outsourcing if they provide RIM successfully for some time.
Regards,
Sunil
2 Sridhar Iyengar March 13, 2009 at 2:45 am
Infrastructure Management may be the (actual) market. Doing is remotely (i.e. RIM) is basically due to cost reasons. Today’s economic situation favors work being done from a lower cost offshore site & thus reducing total cost of operations. This has given tremendous thrust to RIM. In my opinion, when there is a large enough market demand for a particular type or mode of service (with it’s own specific requirements), it takes the shape of an independent market by itself. At that point, one starts losing the distinction between a market & mode of operation/delivery. That is my hypothesis of what is happening with RIM.
Personally, I feel that today RIM is large enough to be considered a market in it’s own right.
At a very basic level, I would draw parallels with what happened in the s/w outsourcing & offshore development, i.e.
Infrastructure Management:RIM::Software Development:Offshore Software development
Regards,
Sridhar
3 remote infrastructure management July 23, 2009 at 1:53 am
Hi!I personally think that,remote infrastructure management is a market.In firms like e4e (which i came across the web),remote infrastructure management provide a comprehensive, integrated maintenance and support offering that helps you achieve the benefits of the seemingly conflicting mandate of lowering costs and improving customer satisfaction.
4 Vinod July 24, 2009 at 11:57 am
Agree with the author on RIM purely being a mode of execution rather than an offering it itself.
RIM started off as an alternate delivery model with the likes of GE for more economic reasons. A large portion of RIM services even today deals with providing labor for managing basic IT compoonents (be it troubleshooting or basic access management and production control functions). Most architecture and engineering work is largely retained and sourced under a T&M model as required.
It is just that the india heritage service providers try making RIM a market in itself so that they can differentiate from the Big 5 who address the actual market (and sold this even before RIM came in).
5 SATISH August 12, 2009 at 5:30 am
rim is next wave of IT
NO: OF JOB FOR RIM=400000 IN 2013=BY NASSCOM
6 SATISH August 12, 2009 at 5:32 am
what the opinion about wipro tis programe
7 Irv February 23, 2010 at 10:11 pm
Eric,
A paradigm shift is occurring as more companies adopt Cloud-based apps. The enterprise network topology must be altered into centralized data center infrastructure to support cloud services, and “access networks” are needed to reach the cloud-based apps.
Remote Access, tele-working, and mobilized workforces will gain importance. It will become more important to remotely manage the access network components and remote end-points. I believe this will be most prevalent in the SMB space. I believe this shift will promote Remote Infrastructure Management into a market.
Regards