The cloud is changing how even the most equipment-focused companies sell their products. One of the most striking examples of that new reality came this week from WAN optimization supplier Ecessa Corp.
For the past 12 of its 44 years, Ecessa has built appliances that help SMBs monitor and control their networks, from spotting emerging bottlenecks to speeding up protocols to fast-tracking data replication among databases.
That's all well and good. But as the job market remains weak and the economy founders, few organizations are willing to invest thousands of dollars into communications equipment. Now, cloud is surpassing on-premise gear in popularity because companies are able to buy the technologies they need on a subscription basis – a more attractive option to many than a giant, up-front outlay of cash. The switch is pushing traditional, box-focused vendors to rethink their business models. To that end, Ecessa has made its WAN optimization technology available, through channel partners, as a service called WaaSWorlD. (It still sells its legacy products.)
Ecessa introduced WaaSWorlD to address concerns voiced by its agents, VARs and MSPs. Earlier this year, they were asking the company to provide the "next step" of WAN optimization. "Customers want this as a service," Brad Pearson, Ecessa's vice president of sales, told Channel Partners at ITEXPO this week in Austin, Texas.
WaaSWorlD is the result of Ecessa's conversations with partners, Pearson said. Here's how the service works: Partners install a micro-appliance at the customer site that connects to the cloud over the users' various Internet-access methods, typically DSL, cable and a T1. From there, WaaSWorlD goes beyond visibility into Internet traffic, usage and congestion; it scours applications such as VoIP, video and Microsoft Office 365, for example, providing automatic notifications, failover, and collecting data and analytics that partners and their clients can use to improve WAN performance.
Channel partners offer WaaSWorlD as a subscription. Ecessa gives them "steep" discounts, Pearson said, so agents, VARs and MSPs then may charge rates of their choice. And for partners who are not white-labeling WaaSWorlD and doing their own billing, compensation is "a completely recurring model," Pearson said.
There are some details, however, to keep in mind. On a three-year WaaSWorlD contract, agents earn commissions on just the first year. They get an "up-front pop" that amounts to the first six months' subscription, then receive recurring payments over the final six months. On years two and three, Ecessa owns the customer. But, partners may upsell their clients at any time and start new three-year contracts on other Ecessa services. They also may go back to WaaSWorlD customers at the end of the third year and renew the contracts, earning commissions on that first year once again. Ecessa formulated its new approach with input from partners including ARG, which now requires its salespeople to lead with Ecessa because the offering creates the much-discussed "trusted adviser" effect, Pearson said.