Gartner 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?
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