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Datapipe bets its MSP service on Amazon cloud

Managed service providers handle the dirty work while charging a pretty penny, and Datapipe now operates on top of Amazon Web Services. But anyone can do the math; is the value still there?

Managed service provider (MSP) Datapipe has launched a new product line based entirely on Amazon Web Services' (AWS) cloud infrastructure. It's a match that turns the normal dynamics of Infrastructure as a Service (IaaS) and the standard MSP model upside down, but it looks like a possible win for customers.

MSPs normally host or run their own data centers and make money on both hosting and value-added services, such as management tools and customer service. Cloud computing trades on its anonymous, robust, do-it-yourself operations to give users direct control without any customer service. Datapipe's new offering means it can't hide what its services cost anymore. One user finds it refreshing.

"The cloud offered an extremely interesting price point based on what Amazon's achieved in scale, but I wouldn't be comfortable working with them directly," said Bobby Gibson, CEO of upscale personal resort agency Villas Caribe. Villas Caribe offers rentals, bookings and management for luxury tropical vacation homes; Mick Jagger's villa is reportedly for rent, so is David Bowie's.

We wanted the price and we wanted the transparency [of cloud computing].
Bobby GibsonCEO of upscale personal resort agency Villas Caribe

Gibson said his company was Web-heavy; they transitioned from print and mail promotions to online about seven years ago. He maintains a development staff that runs his websites, which include fully automated booking and customization tools. Gibson said that he'd decided a while back that Villas Caribe should focus on applications instead of infrastructure, but his current MSP wasn't keeping up with the times.

"We had been in an environment for the last few years that was fairly typical; there was hardware involved and there was management…but we really felt there wasn't a balance," Gibson said. "The previous environment was managed by one gentleman, and he wasn't always available, and there was the 'what if he gets hit by a bus' scenario."

Villas Caribe had also just weathered the economic downturn, a crisis that shook many service businesses to the core, and Gibson wanted to squeeze down costs. He shopped around and found Datapipe on a recommendation; they floated the idea of using AWS instead of their own iron.

Gibson had heard of cloud computing. "We wanted the price and we wanted the transparency," he said.

The advantages of MSPs and cloud

Gibson said that the advantage of using an MSP on top of AWS was that he got an easy look into his actual IT consumption; it doesn't take a math wizard to calculate the cost of servers on AWS minus the price that Datapipe was charging him. It also lets him out of a fixed monthly cost for IT.

Datapipe adjusts its charges based on AWS usage, which Gibson can control. He said he knows his base operating costs and can budget around that depending on his needs. "I've created a pricing scenario so that each month, I can take that and put it towards internal IT or advertising [instead of unused capacity]," he said.

The cloud offered an extremely interesting price point ... but I wouldn't be comfortable working with [Amazon] directly.
Bobby GibsonCEO of upscale personal resort agency Villas Caribe

Gibson said he's also comfortable knowing that his MSP is leaning on multi-billion dollar cloud provider Amazon for reliability and uptime instead of doing it themselves. He'll hold Datapipe to their service-level agreements (SLAs), Datapipe can work it out with AWS and he can get back to the dream vacation business.

Datapipe's technical partnership with AWS includes unified billing as well as a dashboard management system for AWS infrastructure. Customers can fiddle with resources themselves or have Datapipe do it. The MSP says it mitigates possible hiccups in AWS service by replicating across Availability Zones worldwide. It also does away with some of the more obnoxious limitations of AWS, like poor support for email servers and DNS. Datapipe still runs a collection of data centers worldwide, and uses those to pick up the slack on features AWS isn't too hot on.

Many service providers, small and large, now use Amazon for everything from Web hosting to back-end storage, but letting it all hang out this way is a milestone for MSPs and the cloud. If Datapipe can prove its continuing value on top of easy-on, cheap cloud infrastructure that anyone can use, it'll never go out of business.

But it won't be long at all before stand-alone MSP software packages that cut out the middleman roll in. Gibson's next IT upgrade might not include any service at all.

Carl Brooks is the Technology Writer at Contact him at

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