Among the reams of material I read each week about cyber security, I saw that the rise of residential managed services is something of an “MSP urban legend.” People keep saying it’s going to happen, but it hasn’t. At least not in large numbers.
There is increasing evidence we’re approaching a tipping point, but in order for that happen managed service providers need to readjust their thinking, explains Zoe Rose, a prominent cybersecurity specialist, researcher, and former MSP owner based in England.
Homes are small businesses
Take my gadget-loving 75-year-old father, for example. He has a network of inexpensive cameras monitoring his driveway, front door, and hallway; a couple laptops; an iPad; an Amazon Echo; and smart appliances such as a washer and dryer and home-heating system. That’s the internet power once confined to an office, not a home, and that is the shift in thinking Zoe Rose is talking about.
“People don’t realize that as we become more reliant on technology our homes are becoming small businesses,” Rose says, in an interview with Smarter MSP.
“People don’t realize that as we become more reliant on technology our homes are becoming small businesses.” @SmarterMSP
This business mentality will be necessary as the Internet of Things (IoT) becomes the backbone of a home and attack surfaces increase. A home’s internet needs have come a long way from the days of having a single AOL dial-up account. Homes need managed services providers; potential customers just don’t realize it yet.
“You wouldn’t consider at home, requiring a patch management and vulnerability management plan, but as we introduce IoT more and more, that’s important,” Rose says. “Having a standard build, requiring all default passwords changed … and on and on. It really is creeping into the traditionally business world.”
Still the home-as-a-business (HAAB) model does differ in some ways from the SMB model.
“Whereas a business may be concerned about confidentiality and integrity, then look at availability,” Rose says. At home, the paradigm is turned on its head.
“At home, we want everything available all the time, and we need it to be easy. We wouldn’t want strangers accessing our homes, but there isn’t a huge issue with what family member has access to what. Simply put, it’s a different mindset to how things should be configured,” Rose says.
Keep it simple
The key to success for an MSP trying to penetrate the residential market is, Rose says, keeping it simple. The $3,000 RedPort WXA-503-V Satellite Firewall and Rackmount 3-Port VoIP Router probably isn’t going to be appealing to the average homeowner. Homeowners want simplicity and consistency in their MSP offerings.
“Selling in packages, and keeping things simple, look at trying to keep your clients on similar hardware and software. Be very clear on what is and is not covered in the contract, and make sure expectations align across the customer and you,” Rose says. Consistency and simplicity in hardware, too, can help simplify the MSP HAAB model.
“Consider selling pre-configured hardware, too. Going back to the simplified approach, this way you can have a centrally managed platform across clients to have better visibility and build your knowledge base on likely scenarios,” Rose says. The key is emphasizing the HAAB model.
“Remove the idea that it’s just a residential client. Realize it’s closer to a small business. Identifying their focus and expectations, and keep things simple as possible, and always consider security and privacy by design,” Rose says.
Potential customers close to home
Some MSPs seem to be catching on to the HAAB model.
Techsperts is a growing MSP based in Jacksonville, Florida, and they are one of a handful in the U.S. that are actively promoting residential managed services. But, it’s a work in progress.
“Most of our customers are small business owners and directors, and keeping them operational at home is just as important as at work,” says Robert McNicholas, owner of Techsperts since he founded it in 2010.
Techsperts’ typical residential customer has been one of their business customers who wants to get their home cyberlife in order and protected, but the MSP has been gradually dipping its toe deeper into the home waters.
“We haven’t gone out of our way to advertise it, but we’ll be rolling it out more later this year,” McNicholas says. McNicholas echoes Rose’s comments about the needs of a home customer being a little different than an offices.
Residential managed services challenges
“At home we have be a lot more flexible,” McNicholas says. Unlike a company that has various protocols and best practices, kids and friends may jump online at home and visit or download whatever site they wish. No work restrictions here or company handbooks.
“We have to adapt for that,” McNicholas says. And the Internet of Things will only add to a home’s increasing attack surface. Imagine having your cloud-connected refrigerator locked until you pay a ransom. Sounds wild, but it’s already happening, McNicholas says, citing cases of Samsung TVs being held hostage. An MSP at home can help ward off such attacks.
“A lot of it comes down to what a customer is willing to pay. You can employ the same level of security at home, but most people don’t want to spend that kind of money. Most of our clients are setting up new equipment, getting it as functional as possible with their network,” McNicholas explains, with a lot of the monthly MSP bill going toward prevention. Even then the slimmer economics of a home service probably wouldn’t work if Techsperts didn’t have its core SMB client base. Their current plan is to offer a home MSP package for $50 a month.
“If it were our only business model to go after residential businesses, we probably couldn’t make it work, but it is more of an upsell. We’ll deploy some policies from the office, and we generally try to segment things that could be easily compromised from their network at home. That is how we have found it to be most cost effective. We try to take their work and keep it separate from any of that tech that could easily compromised,” McNicholas says.
Experiment in profitability
There is a thread with robust discussion about the economic model of MSPs in residences on Reddit, with some expressing skepticism it can be profitable.
For now Techsperts is going to keep the residential service experiment confined to Jacksonville, but if it goes well they’ll branch out. They’re already planning to open an office in Orlando in the near future.
“Our goal is just trying to market this a bit, and we feel we can get our foot in the door and test what the buy-in is from the community and see if our experiment works,” McNicholas says.
For a customer like my father whose home is beginning to be held together as much by the cloud as it is with joists and struts, a monthly MSP package may be a great investment.