Partners, Here's How to Make Money from AWS, Azure, Google Cloud

By Jeffrey Burt

Getting onto the cloud is an important step for businesses, and hyperscalers such as Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform have many of the services and applications they’re looking for.

But for channel partners helping customers make the migration, there are challenges; in particular, these cloud service providers (CSPs) don’t pay direct commissions to indirect sellers, so partners need to be smart if they’re going to take advantage of the rush to the cloud.

Managed services are a way to make money on the public cloud. Manon Buettner, CEO of Nuvalo; Angela Hogaboom, founder and president of OpenSky Networks; and Michelle Ruyle, CEO of Optimized Channel, will talk about how managed services can help partners get not only professional-services fees but also recurring commissions as they lead their clients into the cloud. It all happens in the April 10 panel conversation, “Where’s the Money in Hyperscale Public Clouds?”, part of the revenue and supplier portfolio conference track, sponsored by Nextiva, at the Channel Partners Conference & Expo in Las Vegas. The panel is presented by Cloud Girls.

Buettner, Hogaboom and Ruyle all took time to answer a few questions about hyperscale cloud providers and the channel. The answers were edited for length.

Channel Partners: What are the biggest challenges for indirect sellers when dealing with the largest cloud providers?

Nuvalo’s Manon Buettner

Manon Buettner: Intimidation — fear they’ll be exposed for not knowing public-cloud products or nuance. Monetization — being paid a percentage of an MSP’s management fee or SI’s reseller fee. Security — helping clients understand best practices for multiple CSPs plus managing a security posture. The also need to compete with internal team predispositions, momentum and politics, realize AWS isn’t the only choice and understand the nuances and lessons learned of each.

Angela Hogaboom: The biggest challenge is identifying ways to monetize large provider services. The large cloud providers don’t offer the traditional commission structure that agents are accustomed to. Without knowing how to monetize, we become hesitant to offer these services and miss out on being involved in cloud initiatives.

Michelle Ruyle: The large CSPs tend to be more MSP-friendly than agent-friendly. Also, for agents, AWS, Azure, Google and others do not pay agents on the customer’s monthly spend. There are a few “specialty companies” paying agents on public cloud customer spend, but it’s an anomaly. The way agents make money from the CSPs is through professional or managed services. Agent beware: Not all MSPs pay on professional services; however, all pay on managed services.

CP: How do managed services enable indirect sellers to address these challenges?

MB: Being a one-stop shop for discovery, planning, migration and ongoing optimization and right-sizing — and an extension of client’s team. There’s also simplified billing and “operationalizing” talent in a talent-short industry. Also, everyone spends so much time on the wedding that they overlook the marriage — upgrades, patching, troubleshooting.

AH: Management is about providing support and …

… solving problems. When an MSP is brought into the cloud conversation, we gain the benefit of understanding the intricacies of the client’s environment and the challenges they face, allowing us to establish a stronger value proposition and solidify the client relationship.

Optimized Channel’s Michelle Ruyle

MR: If you approach every customer opportunity as a three-stage digital transformation and have vendor partners who can help, you become a trusted adviser. The stages are: Stage 1 — Strategy, build and migration. This is the stage where customers have decided they want to move to the cloud and require help with application assessments, refactoring, and migration readiness and planning. Stage 2 — The customer has moved an application into the public cloud and now they need to identify who will take care of security; compliance; [around-the-clock] monitoring; and incident response, patching and backups. Stage 3 — With the application running in the cloud, it’s time to look at cost optimization, compliance and security, as well as DevOps and containers.

CP: What are the key steps MSPs need to take in order to take advantage of the benefits big cloud providers can provide?

MB: They need to know the nuances of each provider and have certifications in at least two hyperscalers. They also need a strong dev team to refactor, reliable service, and immutable infrastructure and microservices, and they need to be great communicators.

OpenSky Networks’ Angela Hogaboom

AH: Education and awareness. Cloud providers give MSPs the opportunity to capitalize on their services in different ways and they provide the tools and support they need to build offerings that sell. Once the time and effort have been made to build a practice around the cloud, messaging is critical. Clients and reseller channels need to be aware of the offering and why they should trust an MSP with their cloud initiatives.

MR: There are hundreds of MSPs in the market saying they can help customers with their public-cloud journey. It’s very confusing to customers. It’s important for MSPs to help customers understand where their expertise is and which public cloud provider they have expertise with: AWS, Azure, Google, IBM Cloud, Oracle, Alibaba. Being clear about your expertise is even more important when customers are looking for a single MSP to handle their multi cloud environments.

CP: What is one thing you would like the audience to take away from your panel?

MB: Bringing the MSP is the missing puzzle piece to the solution. Clients won’t be able to continue scaling talent and keep up with products, especially as they start moving workloads between public clouds.

AH: The need for large-scale cloud is growing in organizations of all sizes. New and emerging technologies like artificial intelligence (AI) and internet of things (IoT) are powered by these clouds. As the channel shifts towards these emerging technologies, it’s important to know how to get involved in the conversation.

MR: Gartner says public cloud is growing. In 2019, infrastructure-as-a-service (IaaS) will grow [nearly 28] percent and reach $39.5 billion. MSPs have identified the value of creating solutions around public cloud providers and have been offering services for years. The agent channel is missing out on revenue opportunities by not having multiple MSP public cloud vendors on their line card and being comfortable having the conversation with their customers about their public cloud needs.