Presented by

Kurt ScherfVice President, Principal AnalystParks Associates

Launching a National SMB Technical Support Service Business

Josh CliffordVP & GM, Business ServicesPlumChoice

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• Subject: Launching a National SMB Technical Support Service Business – presented by Parks Associates and PlumChoice

Recording URL: https://www.livemeeting.com/cc/parksassociates/view

• Recording ID: NRBGZ8 Attendee Key: 8`4z!W2

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Today’s Speakers

Josh CliffordVP & GM, Business Services

PlumChoice

Kurt ScherfVice President, Principal Analyst

Parks Associates

Slide 3

Slide 4

Topics We’ll Cover Today

• Introduction to PlumChoice Business Services• Parks Associates Research Overview• Key Research Takeaways

1. The Importance of a National Brand2. Marketing an SMB Support Business3. Pricing for an SMB Support Plan4. Delivering Proactive Care5. Additional Services Desired

• Q&A• Concluding Thoughts

About PlumChoice Business Services

About PlumChoice Business Services

• Decade of SMB service experience

• 7 years of SMB Managed Services experience

• Over 100K SMB customers

• PlumChoice manages the largest SMB subscription program in the US

• In the 74-84% NPS range and have customer satisfaction rates in the 95% plus range

• Named to CRN's “Most innovative MSP list 2010”

• Focused on delivering national private solutions for partners

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• Deep knowledge of SMB needs & service delivery

• Establishing “First Position:” creating deep customer relationships that increase value

• Experts in Proactive Managed Services

• Nationwide sales and service delivery

• Remote service delivery focus – 90%

• Management of field services nationwide

• Process/metric driven service delivery that is scalable

Core Competencies/Competitive Edge

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The SMB Service Nightmare

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• Remote Support

• Networking

• OEM Peripheral Support

• Wireless Help

• Data Backup

• Security Software

• Application Software

• Onsite Support

Complete SMB Service Roadmap

Slide 9

ReactivePoint-of-Pain

Managed Services

IT Hosting & Cloud

TaaS

• Increased value to SMB & Channel Partner• Higher percentage recurring revenue• Increased stickiness

Parks Associates Research Overview

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Primary Research• Profiles of PC Usage (Q4 2004);• Managing the Digital Home: Installation and Support Services (Q2 2006);• Broadband, Communications, and Entertainment Bundles (Q3 2009);• Customer Support in the Digital Home: U.S. (Q2 2009); • Customer Support in the Digital Home: Europe (Q 42009); • Consumer Demand for Tech Support Services (Q1 2011); • SMB Demand for Tech Support Services (Q1 2011); • The Connected Consumer in Europe (Q2 2011).

Industry Research• Storage and Management for the Connected Home (2005);• Digital Home Services: Carriers, Retailers, and the Customer (2007); • Networks in the Home: The Global Service Provider Play (2008); • Digital Home Tech Support: Analysis and Forecasts (2009); • Connected Home: Global Outlook (2009); • Service Providers and Support Services: Analysis and Forecasts (Q2 2010); • Retailers and Support Services: Analysis and Forecasts (Q2 2010); • Enhancing Support to Mobile Devices (Q1 2011);• The Connected Home and Services in the U.S.: A Roadmap of the Future (Q1 2011);• Consumer Technical Support Solutions: Overview (Q2 2011);• Opportunities for SMB Technical Support (Q2 2011).

Parks Associates Research

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SMB Demand for Technical Support Services:An Overview

Scope: 500 small business respondents

Survey Goals:

• Quantify the IT environment

• Determine where the need is greatest

• Understand support delivery today

• Technology spending plans

• Identify channel opportunities

Market Size: 6.0 million, employing approx. 43 million (U.S. Census Bureau)

Key Takeaways

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Key Takeaways

There is a significant market opportunity for subscription services: today, 15% of SMBs use a subscription-based service.

In terms of frequency, routine computer maintenance, Internet access problems, peripheral issues, and trouble with computers happen most often.

In terms of productivity lost, server problems, mobile phone issues, computer problems, and Internet access issues cause the most lost time.

The issues for which SMBs are likely to consider professional technical support in the future are server problems, Internet access issues, setting up/troubleshooting mobile phones, and networking problems.

The SMB technical support market will grow from $9.6 billion in 2011 to $20.1 billion by 2015.

The Importance of a National Brand

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It’s about Putting a Suite of Services Together

Voice Services

Broadband

Unified Messaging

Web Conferencing

Videoconferencing

Payment Solutions

Advertising Solutions

Technical Support

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From Where do SMBs Want to ReceiveTechnical Support Services?

Computer retailer

Product warranty support

Office supply store

Consumer electronics retailer

Remote tech support

Computer manufacturer

Internet security software company

A broadband service provider’s tech support

Independent tech support company

0% 10% 20% 30% 40% 50%

% Very Interested (i.e., rating 6-7 on a 7-pt. scale)

Interest in IT Support from Company Types(Among small business respondents likely to use professional support for future IT issues)

Source: SMB Demand for Technical Support ServicesSample: 500 IT decision-makers in U.S. SMBs; +/- 4.38%© 2011 Parks Associates

SMBs with 21-50 and 51-99 employees are significant more likely to favor a broadband provider

Marketing an SMB Tech Support Business

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Marketing Strategies

Professional business networking sites

Tech support forums/crowd-sourcing

Equpment manufacturers with whom we work

Friend or family members

Informaton on Websites of hardware and software vendors

Outside IT consultants

Service providers

Other businesses

0% 20% 40% 60%

% Indicating Source is Very Influential (i.e., rating 6-7 on a 7-pt. scale)

Influences on Purchasing IT Support

Source: SMB Demand for Technical Support ServicesSample: 500 IT decision-makers in U.S. SMBs; +/- 4.38%© 2011 Parks Associates

Ability to offer offsite/hosted storage

Ability to proactively prevent IT problems

Ability to have a technician access my equipment remotely

Ability to have a technician on-site within a day

The ability to understand technicians

The speed with which problems are resolved

0% 20% 40% 60% 80%

% Indicating Source is Very Influential (i.e., rating 6-7 on a 7-pt. scale)

Important Features of Support Services

Source: SMB Demand for Technical Support ServicesSample: 500 IT decision-makers in U.S. SMBs; +/- 4.38%© 2011 Parks Associates

Pricing for an SMB Tech Support Plan

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Monthly Expenditures for Tech Support Services

$0

$500

$1,000

$1,500

$2,000

1-10 employees 11-20 employees 51-99 employees

Mon

thly

Exp

endi

ture

($)

Tech Support Subscription Prices Paid(Among small business respondents with a support subscription)

Source: SMB Demand for Technical Support ServicesSample: 500 IT decision-makers in U.S. SMBs; +/- 4.38%© 2011 Parks Associates

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Typical Support BundlesCustomer Profile Bundles

SOHO, 1-2 Employees

• 2 Basic PC Plans - $22 each• Server Maintenance Plan - $99• Network based server backup - $50

• Total monthly recurring contract - $193 / month• Remote Labor Budget – variable hourly

Small Office, 2-10 Employees

• 10 Pro PC Plans - $39 each• Server Management Plan - $299• Network based server backup - $150

• Total monthly recurring contract - $839 / month• Remote Labor Budget – included

Medium Office, 10 – 50 Employees

• 30 Premium PC Plans - $49 each• 3 Server Management Plans - $299 each• 1 LOB application add-on - $200• 1 additional network location – $99• Network based server backup - $250

• Total monthly recurring contract - $2916 / month• Remote Labor Budget – included

Delivering Proactive Care

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SMB Demand for Proactive Care

0% 25% 50% 75% 100%

Offsite/hosted storage of the company’s data and files

Subscription to a remote support service

A computer “tune-up” service conducted by a technician

A PC “health” indicator showing key indicators

Software that automatically performs registry clean-up, disk defragmentation, etc.

Anti-spyware software

Percentage of SMBs Rating Interest as 6-7 (%)

Use of and Interest in IT Support FeaturesPercentage of SMB IT managers rating interest as a 5-7 on a 7-point scale, where "7" means

(Among all small business respondents, n=500, ± 4.38%)

Currently Use Interested in Using

Source: SMB Demand for Technical Support ServicesSample: 500 IT decision-makers in U.S. SMBs; +/- 4.38%© 2011 Parks Associates

Additional Services Desired

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Additional Services Desired

Blog setup and optimization

New product evaluation

Mail migration

Sales generation

Marketing support

Purchase assistance

Office automation solutions

Search engine optimization (SEO)

Website design/redesign

Server or desktop consulting

0% 10% 20% 30%

% Very Interested (i.e., rating 6-7 on a 7-pt. scale)

Additional Services Desired(Among small business respondents likely to use professional support for future IT issues)

Source: SMB Demand for Technical Support ServicesSample: 500 IT decision-makers in U.S. SMBs; +/- 4.38%© 2011 Parks Associates

Priority 2011 2012 2013

New Products 1 Tablet Concierge

Notebook Anti-Theft Hybrid Cloud TaaS Print Services

2 Mobility Server Hybrid Remote/Onsite

Sales & Marketing As a

Service

3 CIO Services Hosted VOiP

New Segments/ Verticals

Healthcare Legal; Real Estate

Add-On's 1 Mobile Device Support

Hosted Business Apps

Self healing tools

Server Virtualization

2 Disaster recovery Email Encryption Energy

Management

3 Branded Email Hosted SPAM Recycling

Sample Additional Services Product Roadmap

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Q&A

Slide 28

Josh CliffordVP & GM, Business Services

PlumChoice

Kurt ScherfVice President, Principal Analyst

Parks Associates

At CONNECTIONS™ Summit, leading executives share consumer and industry data on trends in CE, home systems, value–added services, video, and mobile; building ARPU through video, support, and mobile; consumer and business strategies for connected CE; smart grid benefits and challenges; and mobile applications.

9:30 -10:45 a.m. Smart TV 2012 OutlookOver 40% of all flat-panel TVs sold in 2011 are Internet-connectable, impacting viewing habits, business plans, and the role of other devices in the home. Parks Associates examines the evolving role of the television as it becomes the foundation for the connected home and influences the use of game consoles, tablets, cloud services, and smartphones.Moderator: Kurt Scherf, Vice President, Principal Analyst, Parks Associates

11 a.m.-12:15 p.m. Video: Three Screens and BeyondContent must stretch across multiple platforms to meet the demands of today's consumer, who have smartphones and tablets in hand as well as connected TVs and Blu-ray players at home. This session tracks the progress of premium video across multiple screens both in and outside of the home, examining consumer demand and business opportunities at each point in this expanding ecosystem.Moderator: Brett Sappington, Director, Research, Parks Associates

1:00-2:15 p.m. Consumer Demand for Energy as a ServiceBroadband has created new opportunities for energy in the home, opening this market beyond traditional utilities and energy service providers. This session, with data from Parks Associates' Residential Energy Management research service, examines the new role for providers and manufacturers in energy services and how market forces and consumer demand are creating a new breed of value-added services.Moderators: Farhan Abid, Research Analyst, Parks Associates

Stuart Sikes, President, Parks Associates

2:30-3:15 p.m. Technical Support, Customer Service, and the Lifecycle in the Digital HomeThe need for tech support has expanded exponentially with the rise of complex, interconnected devices, opening opportunities for OEMs, retailers, and broadband and independent providers to forge long-lasting relationships with consumers. The session explores new service opportunities for tech support, its impact on customer satisfaction, and the role of cloud services in expanding support services.Moderator: Kurt Scherf, Vice President, Principal Analyst, Parks Associates

4:00-5:15 p.m. The Personal Cloud and Digital LockerConsumers increasingly see physical media as an inconvenience, yet early data show they are not ready to move everything to the cloud. Parks Associates presents the latest consumer research on the transition to the cloud, the business challenges, and opportunities created by the digital locker.Moderator: Harry Wang, Director, Health & Mobile Product Research,

Parks Associates

5:30 p.m. Networking ReceptionJoin Parks Associates and Premier Sponsors for a networking reception in the Hilton . Food, drinks, and face-to-face time with the leading digital living analysts!

Contact Information

Parks AssociatesKurt ScherfVice President, Principal Analystscherf@parksassociates.com

PlumChoiceJosh CliffordVice President & General Manager, PlumChoice Business Services info@plumchoice.com