Hosted Microsoft applications are all the rage in the SaaS market. The latest move involves Intermedia -- which specializes in Hosted Exchange -- inking a relationship with Ingram Micro Seismic, the master MSP (managed service provider). Here's a look at the deal and the implications for VARs and MSPs.

No doubt, plenty of solutions providers are trying to determine which route to take in the Microsoft SaaS market. Key options include:
  • Building a service on your own
  • Becoming an agent for Microsoft and reselling the Microsoft Business Productivity Online Suite (BPOS), which involves Microsoft running and managing Hosted Exchange, Hosted SharePoint and other applications in its own data centers.
  • Finding a third-party service that you can re-brand and resell as your own

Decision Day

For many VARs, building a data center and hosted service requires too much time and money. But becoming an agent for Microsoft risks losing account control -- since Microsoft essentially controls branding, billing and application management in the BPOS scenario.

With those potential concerns in mind, plenty of VARs and MSPs are seeking out third-party. And Intermedia is more than happy to answer the potential call for help. As MSPmentor reported today:
Intermedia claims to be the world’s largest Exchange service, hosting more than 225,000 Microsoft Exchange mailboxes. The company says it has offered private label Exchange hosting since 2001 and has more than 4,000 partners. Intermedia’s sums up its channel strategy by stating: Resellers can increase their recurring revenue with high margin Exchange hosting services they sell to their current customers and use to win new business – all under their own brand – while Intermedia maintains, monitors and upgrades the hardware and software.

Oh, and Today's News

Heck, The VAR Guy nearly forgot to mention today's news. Ingram Micro Seismic, a master MSP that offers a range of services to VARs and MSPs, today agreed to co-market and sell Intermedia's services to IT channel partners.

MSPmentor describes what the deal means to Seismic partners. But ultimately, here's what the deal means to VARs and MSPs: The hosted Microsoft applications market is getting very crowded -- with competitors like Apptix, Intermedia, mindSHIFT, Rackspace Hosting and SherWeb Inc. striving to compete with Microsoft's own BPOS efforts.

The key questions for VARs: Do you really want to tie up your dollars building out similar services? Or is it simply time to partner up and leverage third-party Microsoft hosted services?

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