PSA and RMM Software: Market Consolidation or IT Convergence?

2PuzzlePieces

When I first spoke with ConnectWise CEO Arnie Bellini about the ConnectWise Capital investment LabTech Software, I mentioned the word “consolidation” over and over again. All IT markets, after all, eventually consolidate around a few market leaders. But Bellini continually reinforced the “convergence” theme rather than “consolidation.” His key point: Software needs to work together in order to accelerate market growth.

Apparently, Bellini is onto something. He took some heat from some MSPs when ConnectWise Capital first invested in LabTech Software. But the critics didn’t notice Kaseya was essentially taking a similar step, striving to build its own PSA capabilities directly into the Kaseya 2 IT automation platform. And more recently, Quest Software’s PacketTrap team has pushed beyond RMM software (PacketTrap MSP) to offer a PSA edition (PacketTrap PSA).

Whether you call it consolidation or convergence, few software vendors seem to be suffering. During recent calls with a range of RMM and PSA vendors, virtually every CEO told me about strong 2011 performance that continued in 1Q 2012. But I wonder:

Answers pending.