Solution for VARs Is in the Box

Allegrix, Inc., last week announced its ASP-in-a-Box initiative for channel solution providers, including ISVs, VARs, and systems integrators, giving channel-based solution providers an assessment kit for moving to the ASP model.

ASP-in-a-Box, combined with Allegrix’s ASP-enabling services, which include application enabling services, an enterprise-class data center infrastructure, catalog applications, and professional and marketing services, gives channel partners everything they need to become instant ASPs.

“This is the year the channel will become engaged in the ASP market,” Mike Foster, Allegrix VP of Marketing, told ASP News. “We want to accelerate the knowledge base in this area.”

According to Foster, many VARs and ISVs feel threatened by the ASP model, or just don’t have the tools they need to make informed decisions. “We kept running into the same questions and problems. We want to help channel providers understand what it takes to get into the ASP market,” he said.

What’s in the Box

Information in the box is split into packets for each of a VAR or ISV’s key departments: Finance, Sales, Engineering and Marketing. Each section includes answers to questions and modeling tools to assist in decision-making, he said.

Customer Savings Analysis and Margin Analysis Tools help Finance run the numbers, according to Foster. “They need to know how it’s going to affect cash flow and revenue,” he said.

Sales Force Compensation models and Service-Level Agreement (SLA) templates assist Sales in adapting to new methods. In a packaged-product model, a third of the sale was collected up-front as the salesperson’s commission, but the ASP model is based on a monthly subscription-based fee. “How motivated is a sales force going to be if they only get 1/36th up front?” Foster said.

The Engineering department needs to consider alternatives such as using a third-party data center or building their own. ASP-in-a-Box includes a “build vs. buy” comparison to help in this decision, Foster said.

“It’s not as simple as throwing another couple servers under the desk and calling yourself an ASP,” Foster said. “You also have to supply the bandwidth, the support, the reliability and the security.” Allegrix’s offers partners its own data center services, co-located with Exodus, offering 24×7 server monitoring and customer support, full network redundancy and daily data backups, he said.

For the Marketing Department, ASP-in-a-Box offers tools and techniques for the transformed ASP to expand market share and differentiate itself. An End-user Savings Calculator is included to help spread the word of the ASP advantages, he said.

Many VARs and ISVs mistakenly think that their channel expertise will easily translate into ASP expertise, Foster said. “A third of the customers coming through our door have already built their own data center, then come to us later,” Foster said.

Even though VARs and ISVs have the skills and expertise in their area, there are other roadblocks, Foster said. “They realize they can’t buy at a level of volume to make it affordable to their customers. And they can’t pass on the capital equipment costs to customers like in the old days.”

ASP-in-a-Box ships in September. Through marketing agreements with SCO , Progress Software , Great Plains and Avnet‘s Hall-Mark Division , the ASP-in-a-Box package can be customized with each partner’s content and shipped to their channel partners, Foster said.

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