The growth of cloud applications is causing problems for MSPs, according to Autotask's SVP of channel development, Len DiCostanzo.
DiCostanzo said it is becoming "a real issue" for MSPs to track and bill clients for cloud licenses, while reconciling against vendor invoices.
"Back when software came in a box, it was installed, billed and paid for on one invoice," DiCostanzo said. "Cloud apps are primarily being billed monthly as a managed service. While this adds incremental recurring revenue, it adds up to a big headache."
The SVP said instead of one-time invoicing, MSPs now need to manage "the constant fluctuation of provisioning and monthly billing of additional licensing and reduction of licenses as client employees come and go".
They must then reconcile this against cloud vendor invoices and ensure they are billing clients exactly what vendors are billing them.
"Overbill and MSPs look bad, underbill and revenue could be lost forever even though MSPs will be on the hook to pay their vendors," DiCostanzo said, adding that vendors, distributors and MSPs "need to work together to ensure automated processes are put in place to make it easy for the channel to embrace the cloud".
Autotask also noted in a blog post today that MSPs must ask their cloud vendors for their uptime track record. Fail to do this and you could find yourself working with a "cloud poser", the RMM vendor warned.
"[The track record] should be more than three years," Adam Stewart, VP of engineering at Autotask, wrote. "Ask them for details around any outages. Ask them for their track record on scheduled maintenance. Do they have weekly maintenance windows where you won't be able to rely on their application? Do they go down when deploying an update?"
The VP also advised MSPs to make sure any contract entered into with a cloud vendor backs up whatever claims are being made, as well as understanding exactly how long you can go without the relevant data before it starts to hurt the business.
And lastly, he advised how to spot a 'cloud poser'.
"Beware of anyone who promises five nines of uptime - five minutes per year. You may be talking to or working with a cloud poser," he cautioned.
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