What to sell during a recession

Even during the worst of times, companies still need to purchase and maintain computers. Electronic data is our currency, and without it, we are all lost. "People still need to operate their infrastructure," said Joe Brown, president of Accelera Solutions, a VAR focused on the virtualization space. "They still have some growth that requires new servers and storage. Maybe it's going to slow down, but it's not going to stop."

And some things aren't slowing down at all. Technology that replaces expensive, administration-heavy systems with new technology that cuts down overhead are all the rage during times when companies across all sectors are looking for ways to increase productivity and cut costs. Technologies such as virtualization, cloud computing, and software-as-a-service will continue to be big winners, simply because they eliminate the need for large upfront capital expenditures. And good news for VARs, outsourcing is always a big plus during a downturn.

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Virtualization is one of those "disruptive" technologies that continue to do well by delivering a big cut to expenses and a quick return on investment. "The virtualization space lends itself greatly to helping organizations save money due to consolidation on the server hardware side," said Brown, "and due to the ability to reduce the management costs of your overall IT infrastructure." In addition, the move towards "green technology" continues to be a major contributor to the growth of virtualization technology. R.W. Baird's Enterprise VAR Survey shows virtualization remaining strong during the weak economy, with resellers reporting year-on-year VMWare license growth of 15 to 22 percent. IT Security

Cybercriminals don't care about economic downturns, and in fact, it's likely that there are more of them during hard times. And so the need to combat cybercriminals continues unabated. Michelle Drolet, founder and CEO of IT security services firm Towerwall, has seen it first-hand. "The uptick of the Internet, and the amount of dollars people can make with the underground mafia, is tremendous. It's only going to increase, whether the economy is rough or not rough, because there's so much money from an identity theft perspective." The numbers back this up. According to Forrester research's Forrester Business Data Services survey, which polled more than 1,200 enterprise and SMB security decision-makers, 21 percent expect to increase IT security budgets in 2009, and about three-fourths do not expect any cutbacks. Within the security realm, data protection is critical, with over half of the respondents saying that protection of corporate IP and customer data was their top priority for next year. Backup and archiving Part of the entire security infrastructure is backup and archiving, which is also continuing to grow. Steve Ferman, besides being President of Compunite (see below), is also President of Compuvault, an offsite data backup company. Ferman says "You have to learn to manage peoples' data, instead of just backing up their data. It's not about the backup, it's about the recovery. " There are users of all sizes that simply don't know what to back up, he says. "They don't know how old the data is, they don't know the last time it was modified, they don't know if it was even touched in the last ten years, or if they have to keep it because they're regulated. So one of the big things an MSP can do is start trying to be a consultant, and understand what they have, and what they should or shouldn't do with that information. That's huge." Software-as-a-Service and Managed Services

Software-as-a-service is a natural for recessionary times because of the inherent cost advantage and the fact that customers don't have to make capital expenditures. AMI-Partners' SMB predictions for 2008 anticipates significant growth in SaaS. In 2004, 10 percent of US small businesses and 15 percent of medium businesses used SaaS; by 2007, 21 percent of small businesses and 30 percent of medium businesses used it. As broader implementation of SaaS takes hold, more vendors of SaaS solutions will enter into more partnerships with VARs and other resellers. Business Intelligence and analytics

"Even in hard times, people want to understand how to better allocate their money and better manage their businesses," said William Dunn, president of IT consulting firm Dunn Solutions Group. "When things are really good, there is less impetus for managing quite as tightly as you want. When things are tight, people want to manage better." That's the beauty of business intelligence and analytics, which is rapidly moving from being a "nice to have" to a "must have." Home automation and control

One would think that during a crunch, people would normally put off having their homes automated like Bill Gates' mansion. And while it may be an unnecessary luxury, it is one that is rapidly decreasing in price and becoming available to a whole new audience, according to David Berman of the Home Theater Specialists of America, who says, "The largest segment of the market now has access to affordable levels of control." Berman notes that with the advent of more affordable technology and IP-based signaling, more affordable controls are available, and "you can extend control of your lifestyle activities to those types of devices for one tenth of its original price."

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