IT and Business Insights for SMB Solution Providers

Reduce Clients’ Hardware Costs and Improve Margins with WaaS

Workspace-as-a-service platforms not only reduce overhead costs and improve security for the customer, but improve client retention and boost margins for the MSP. By Jon Senger

Businesses can reduce their IT costs by implementing new software tools that enable them to continue using older client devices and servers while simultaneously improving the productivity of their workers.

The solution lies in delivering software applications to the user’s client device while requiring only a minimal set of computing resources. Workspace-as-a-service (WaaS) platforms mitigate the legacy equipment problem and also support new, highly desirable services like BYOD.

There are two parts to the challenge of using legacy systems.

First, many businesses have made significant investments in desktop and laptop computers for their workers. As these machines age, they tend to become less capable of running the software required to run the business and more prone to failure. An application delivery system that requires only minimal memory, hard disk space, and CPU horsepower can give new life to these old machines, and in the event of a failure, all that has to be installed is the operating system itself.

Let’s look at a real world example:  A business with 60 users that it must equip with adequate PCs:

Number of Computers

Average Cost per Computer

Refresh Cycle

Total Capital Cost

Annualized
Raw Cost

Raw Cost
per Month

Percentage

Savings/Month

on Hardware

60

$700

48 months

$42,000

$10,500

$875

 

60

$700

60 months

$42,000

$8,400

$700

20%

60

$700

72 months

$42,000

$7,000

$583

33%

Assuming a cost of $700 per machine and a four-year refresh cycle, the amortized raw cost of owning these computers is $10,500 annually, or $875 per month. By implementing WaaS, the business can increase the useful life of these machines. Just increasing this refresh period by a single year saves $175 per month, and increasing it to six years results in a monthly savings of $292 for the customer.

Another benefit of using these new, light-footprint WaaS platforms is that businesses can completely replace traditional desktop computers with thin clients like the Intel Compute Stick, which sells for around $150. Let’s look at that same customer:

Number of Compute Sticks

Average Cost per Computer

Refresh Cycle

Total Capital Cost

Annualized
Raw Cost

Raw Cost
per Month

Percentage Savings/Month
(compared to standard workstations)

60

$150

48 months

$9,000

$2,250

$188

79%

The second major aspect of the challenge is that many businesses rely heavily on line-of-business applications that may have been designed 10 or even 20 years ago. These typically use client/server architectures and were probably built before the concept of the cloud was a reality.

In a WaaS-based infrastructure, the client application runs on the server, which can even be the same server handling the database. Many users will see an increase in responsiveness and overall performance, since there will no longer be data-heavy traffic flowing between the client device and the database.

Workspace-as-a-service technology also offers tremendous benefits to MSPs. A well-designed system supports ultra-fast provisioning of new client infrastructures and streamlined management of all customer sites from a single pane of glass.

It’s not free, of course. A good WaaS service will cost the MSP in the neighborhood of $10 per user per month. The MSP can mark this up to whatever the local market will bear or incorporate the fee into an overall service offering. However, the benefits of improved security, BYOD, secure remote access without VPNs, and savings on hardware make for a compelling business case that’s easy to sell.

MSPs looking for a way to add more customers, improve client retention, and increase margins should look seriously at making workspace as a service a key component in their offerings.  

Jon SengerJON SENGER is a tech industry veteran with a passion for creating and driving strategy in new and emerging technologies. As CTO of Vertiscale, developer of the leading WaaS solution for healthcare providers, he empowers managed service providers to grow their businesses with technology that adds value easily, economically, and securely. Jon resides in Austin, Texas, and has previously held technology positions with Dell, JPMorgan Chase, and Qwest.

Comments

Submitted by Kingfish on
It doesn't appear that you took the hardware at the clients desktop/home/etc.. that is required to remotely access desktops in the cloud. i.e. they require a computer/thin client to be on premise so they can access the cloud computers, right? What is recommended for on premise. So does the client need to invest in thin Clients, Citrix, other ? Doesn't this transition cost for this infrastructure and how often will this local hardware need to be refreshed. Thanks again
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