The Syndication Strategy: Three Myths about Cloud Syndication

Did you watch television or listen to the radio sometime today? If so, chances are that you recently participated in a syndication model – but television and radio aren’t the only mediums that profit from syndication. So does the cloud. 

Syndication is becoming an important strategy for service providers to consider when determining the strengths, opportunities, and weaknesses in their portfolios. Like many emerging trends, syndication in the cloud can be easily misunderstood or pushed aside without being critically evaluated. 

Defining Cloud Syndication

A syndicated television or radio program is one that, instead of being shown exclusively on a single network, is licensed to be run on several networks or stations. This model is very similar to syndicated cloud services, where a service provider offers a service and controls its customer experience while the service remains hosted by a third-party data center. The provider can then provision and bill for the service without needing to manage the application or its in-house server. 

Now let’s move on to the busting – err… we mean “discussing” – of a few common syndication myths. 

Top Three Syndication Myths

Myth #1: Syndication leads to lower profits than hosting in-house, so it really isn’t worth my consideration. 

MythsBustedGraphic_Cropped.jpg

BUSTED: Hosting all of your portfolio’s services in-house may not always be possible, efficient, or the best decision. Is a certain service part of your core business offering? Then you’ll likely be better off hosting it in-house. But what if the service is more of an add-on? Then you might want to consider syndication. 

For example, Cobweb has long been a leader in hosted exchange. Even so, they recently joined the Microsoft CSP (Cloud Solution Provider) program to mitigate any risk of losing business opportunities by not offering Office 365. By participating in a cloud syndication model, Cobweb can continue to focus on its core portfolio without losing customers who absolutely need a particular kind of service. 

Syndication also provides the ability to layer on your own value-added services – your “secret sauce” – and profit from that. So yes, in a pure comparison, you might experience a lower profit margin by not hosting or managing a service in-house. However, when you look at the big picture, syndication creates valuable opportunities for you to upsell and cross-sell on top of an anchor service which can push your margins far beyond where they might have been otherwise. 

Myth #2: Syndication is simply a way for me to sell other people’s services. 

BUSTED: It’s easy to see that syndication is a helpful way to sell services created by others – whether that’s adding a security product from Symantec or offering a storage product like Box. But this doesn’t need to be a one-way street. 

In addition to allowing others to provide their services through you, syndication is also a way for you to create a channel for selling your own services. For example, SoftLayer is a traditional hoster that has recently launched a syndicated version of their IaaS offering to the market. Speaking of IaaS, that brings us to myth #3…

Myth #3: Syndication is only for SaaS. 

BUSTED: Not true. While Office 365 is probably the most common example of a successful syndication model in the marketplace, there are also many examples of successfully syndicated non-SaaS applications. These include SoftLayer and Hostway’s IaaS, Acronis, Box, Symantec, and other security and storage solutions. There are many syndicated options that can help fill gaps in a service provider’s portfolio, even beyond a SaaS perspective. 

Profiting from Syndication

Many Odin partners participate in some form of a syndication model, from some of the world’s largest telecommunications companies (like America Movil and Telefonica) to other industry leaders such as Appriver and Sprint. Odin supports a wide range of syndicated services including Office 365, SoftLayer, Acronis, Box, WebEx, Mozy, solutions from Symantec, and Google business apps. 

If you are interested in learning more about cloud syndication, please visit http://www.odin.com/csp/.

 

 

Posted on July 21, 2015 and filed under Industry & Market Insights.