Why MSPs Should White Label Virtual Machines

Most of the services that managed services providers deliver are dependent on some instance of a virtual machine being present. It’s not an absolute requirement to have a virtual machine present, but it sure does make delivering managed services a whole lot easier. Better still is when the virtual machine in place is one the managed service provider actually deployed.

With that in mind Egenera has moved to embed the open source XenServer virtual machine directly within the company’s Egenera Pan Manager software for virtualization environments. John Humphreys, vice president of marketing for Egenera, says that Egenera Pan Manager will still support all the major virtual machine platforms. But in instances where the customer has no virtual machine preference the managed service provider (MSP) can default to deploying XenServer.

Of course, one of the nicest things about XenServer is that as open source software it doesn’t cost the customer or the MSP anything to deploy. In contrast, licensing costs for deploying VMware virtual machines can quickly spiral out of control.

All this brings up an interesting point of discussion. While the management environments surrounding a particular virtual machine may differ, the virtual machines themselves have for all intents and purposes become a commodity. As a managed service provider, the optimal choice is to deploy a management framework that can support multiple types of virtual machines regardless of what the customer requires.

But more often than not customer choices on virtual machine brands have been decisions of happenstance. That creates an opportunity for MSPs to save customers money on licensing by standardizing on a virtual machine solution that is free to the service provider, thereby freeing up money to spend on additional managed services.

Think of open source virtual machines as the rough equivalent of a white label machine that any MSP can brand as they see fit.

Fresh off raising another $16 million in funding, Humphreys says about half of the company’s revenue comes from MSPs and cloud service providers that deploy both Egenera Pan Manager and the Egenera Cloud Suite.

It’s often nice to be able to leverage the branding of a larger company such as VMware or Microsoft. But with virtual machines becoming so commonplace the value of that reflected branding is in decline. Given that new reality, the issue and opportunity should become how to deliver a managed service that embeds a “white label” virtual machine that does everything the customer requires while at the same maximizing the profitability of the MSP that installed it.

Mike Vizard is a top IT journalist with 30 years experience covering enterprise IT. He has served as editor in chief for CRN and InfoWorld.