2000-2025: The Internet Era and the Dominance of Managed Services

A Look at the First Quarter of This Century in Technology Consulting

Lots of people are talking about the year in review. We’re closing in on the end of the first quarter of the century! Let’s look at that. Of course, in the world of IT consulting there are two clear tracks to look at: The evolution of technology and the evolution of Managed services.

Let’s look at the tech first.

The change has been astonishing. “Millennials” became adults around the turn of the century and now they’re in their 30s and bringing up the next generation. Here are some key changes that affected our industry (and the whole world, really).

In 2000, we had big cell phones but no smart phones. Tablets were just a thing on Star Trek: Next Generation re-runs. And, along those lines, “screens” were monstrous, heavy CRTs that were closer to a television than anything else. Today I have so many screens I don’t know if I can count them. They’re in my car, in my hand, on my picture frame, and on all those tablets and devices lying all over the place.

In 2000, Data storage consisted primarily of 3.5” floppies and CDs or DVDs. There was no “cloud” (although data centers did exist). Today SSD (solid state drives) are standard. We still have spinning discs, but they tend to be the second drive, not the primary. Cloud storage and cloud-based services did not really take off until the 2009-2011 recession when people didn’t want to invest in hardware. Now you have to defend your choice to put a server onsite.

In 2000, desktop computers were running Pentium III processors. With one core, of course, that topped out around 1100 MHz (1.1 GHz). Today you can buy an Intel Core 9 Ultra that has 8 cores at 3.7 GHZ – for about the same price.

Wi-Fi existed but was not common in 2000. Of course it’s everywhere today.

In the early 2000s, we ran Windows XP and Mac OS X, although a lot of people refused to give up their Windows 98 machines!

And while web browsing evolved in the 1990s, it didn’t take off as we know it today until after the dust settled from Internet Bubble Burst.

Quantum Computing – always twenty years from being feasible – started to become a reality in the 2010s, but for specialized purposes only. General purpose QC is . . . just around the corner I’m told.

IOT: In 2000, connecting “things” to the Internet was not a thing. Today, everything is Internet-enabled even if there’s no point to it (I’m thinking about washing machines and household refrigerators). My house is lit by lightbulbs controlled over the Internet so I can read my thermostat connected to the Internet.

AI: In some form, AI has been around since the turn of the 20^th century (and was the result of an evolutionary path that goes back to automated mechanical men in China about 1000 BC). Machine learning took off in the mid 2000’s and came into its own in the 2010s. Virtual assistants (Alexa, Siri, etc.) went from toys to a part of everyday life in the 2010s. AI finally got to the point where it could consistently beat humans at games in the 2010s.

We’re now it what will come to be known as the early years of Generative AI. OpenAI’s GPT3 was announced in 2020 and kept us entertained plagiarizing everything we could think of while stuck at home in the pandemic.

Robots did become a thing! The Roomba started driving around the living room in 2002 and is just now beginning its death throes. Today we can risk our lives by getting into an “autonomous vehicle” almost everywhere in the world. And many people forget: The largest robot you can interact with on a regular basis is an airplane. While they don’t take off on autopilot, they fly around the world on it and, if necessary, land on autopilot.

For IT consultants, this century began with big monitors, “small” floppy discs, and heavy desktop machines. We made a lot of money getting people connected to the Internet, selling businesses their first server, and figuring out how to make money after the installation project was complete.

 

And THAT’s where Managed Services entered the scene.

In 2000, big (enterprise) businesses were used to doing regular maintenance, but it was primarily done in-house. Outsourced maintenance was pricey. (Trust me. I approved the invoices.) For small businesses, there was essentially no maintenance for most companies.

At the time, the small business world was dominated by projects. And, most commonly, projects consisted of installing some really cool system, cashing the check, and walking away. If something broke, and the IT consultant wasn’t in the middle of another project, they fixed it. Looking back, we call this break/fix. At the time it was just computer consulting.

But many companies, including mine, started doing regular monthly maintenance for clients in the 1990’s. So in the 2000s, it was very natural to think about how we could turn that into a flat-fee service and then a recurring revenue model. “Managed Services” evolved as the natural next step. There was a kind of simultaneous invention of the managed service business model.

By the end of the 2010s, Managed Services had become the nearly universal model for service delivery. Even people who claim to only provide service “on demand” tend to sell subscription licenses for RMM, office software, cloud services, backup, and so forth. They provide regular monthly services, billed on a flat fee basis, which includes some level of support. They just don’t call it Managed Service.

Now, in the middle of the 2020’s, as we finish the first quarter of this century, we can see the dawning of the next age. AI is already being used for simple IT “fix-it” jobs. By 2030, an entire layer of client support will simply disappear as it becomes easier and easier to simply ask AI how – followed by asking an agent to DO.

Please don’t spend one second worrying about your future. You won’t lose work unless you insist on doing a job that no longer exists. If you built an entire business on getting people connected to the internet, you would have been out of business a long time ago. The same is true if you refused to put anything in the cloud. AI will happen. It will change your clients and it will change your business. The question is not if, it’s how fast.

You can literally redefine your business right now to grab onto the opportunities brought by the emerging AI. The formula is very simple: 1) Educate yourself. Learn AI. Learn how it can be applied in your client’s businesses. 2) Educate your clients so they see a bright future, not a scary dystopia. 3) Become an AI strategist – a true provider of solutions for your clients.

The AI Solution Provider will spend time learning about the client’s business and figuring out where the problems and holes are. Then that consultant will help the client craft a solution and implement it. And, I assume, collect a monthly fee for maintaining it.

As the next quarter-century arrives, your future is as bright and positive as you are willing to work for.

You need to invest in training, educating yourself, your employees, and your clients. And you need to consciously create a business as an AI Solution Provider. As with everything that takes commitment and effort, no one else can do this for you. Because . . .

Nothing Happens by Itself!

How bright will you make your future?