Lenovo plans to introduce a purchasing program for MSPs who wish to sell data center infrastructure as a service.
The new offering, which will debut in April at the start of Lenovo’s 2022 fiscal year, is designed to let managed service providers sell consumption-based server, storage, and networking capacity to end users from their own private cloud, according to Steve Biondi, the company’s data center channel chief. Partners will own and operate hardware assets themselves, and pay for them in monthly installments over the course of a five-year lease.
“Basically, they’re paying one-sixtieth a month for 60 months,” says Biondi, who’s official title is head of partnerships and channels for the North American Data Center Group. That arrangement is designed to align with the recurring revenue billing model MSPs typically employ.
“I’m lowering their entry point from a capex standpoint to have platforms on which to provision workloads for their customers,” Biondi says.
Partners will also receive a discount on hardware commensurate with their current partner program membership level. Discounts on software will be available through Lenovo’s alliance relationships with Microsoft, Red Hat, VMware, Veeam, and other software vendors.
“Not only am I going to give them the gear at a very affordable rate, I’m also going to offer to them, if they want, other workloads that they can offer to their customers,” Biondi says.
Lenovo will refresh as-a-service hardware at no additional cost if the company’s processor suppliers—AMD, Intel, and NVIDIA—ship faster chips in the middle of a partner’s five-year term.
“They no longer have to worry about figuring out how to get the next Intel chip set out or the next AMD chips,” Biondi says. “I’m going to handle all that for them, so this becomes a very low-risk entry point for them to get into the managed service space or enhance their current managed service programs.”
Partners will have complete control over everything their customers store on leased gear. “I’m not sharing data,” Biondi says.
Other data center hardware manufacturers offer as-a-service procurement. Hewlett Packard Enterprise, for example, opened its usage-based GreenLake offering to partners in 2018, and added packages specifically for SMBs priced at $70,000 and up last September. Dell Technologies, similarly, introduced consumption-based purchasing for nearly every client and data center product it makes late in 2019.
Lenovo’s program, the company says, is different because it allows MSPs to sell infrastructure they own directly to customers, rather than resell a vendor’s resources. “It’ll be a partner-led hybrid cloud discussion,” Biondi says.
Other adjustments to Lenovo’s data center partner program slated to take effect April 1st include the addition of a new “platinum plus” tier to the current authorized, silver, gold, and platinum levels. That move comes in response to surging growth at the program’s current peak tier, which has made additional differentiation for elite members necessary.
“We’ve grown our platinum partner footprint by 100% in the small/medium partner space,” Biondi says. “I expect in fiscal ’22 that we’re going to probably double our platinum base again.”
An enhanced benefit structure designed to reward partners for seeking higher membership status is a core design element of the revamped data center partner program Lenovo rolled out last April. The new offering has helped the company recruit partners too.
“We on average added about 500 to 700 partners per quarter for the fiscal year of ’21,” Biondi says.
The program’s more strategic goal was increasing Lenovo’s single-digit share of the U.S. data center market. Though up 50% since last April, that share is still shy of the double-digit target Lenovo set for the current fiscal year.
“I foresee that coming in the next quarter or so,” Biondi says.
Data center sales to SMBs are up 67% for Lenovo since April 2020, and remain strong. “It’s hard to predict the future here, but right now there’s no indication that our growth is slowing down,” Biondi says.
Even so, he continues, many partners continue to suffer the revenue-slowing effects of the economy’s “COVID hangover.” As a result, Lenovo plans to extend the channel stimulus measures it announced last April as lockdown orders went into effect around the globe through the 2022 fiscal year.
Lenovo introduced a unified portal for its client device resellers and data center partners last July.
