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optimizing MSP object storage margins
How MSPs Can Protect Margins With Sovereign Object Storage
Are hidden egress fees and complex API charges silently eroding your MSP margins? A startling percentage of cloud bills contain unpredictable costs that make profitability a moving target. This article outlines a clear strategy for optimizing MSP object storage margins through a predictable, sovereign-by-design architecture.
The topic briefly and concisely
Eliminate unpredictable egress and API fees, which can inflate cloud bills by over 900% during data recovery, by adopting a transparent storage model with zero hidden costs.
Leverage EU-based, sovereign object storage to meet the growing client demand for GDPR compliance and protection from foreign laws like the US CLOUD Act.
Simplify operations and accelerate recovery with an "Always-Hot" storage architecture that makes all data instantly accessible without complex tiering or retrieval fees.
For Managed Service Providers, delivering profitable Backup as a Service (BaaS) and archiving solutions depends on predictable costs. Yet, many MSPs find their margins squeezed by the pricing models of traditional cloud providers, where hidden egress fees and API call charges can turn a profitable contract into a loss during a client recovery event. A significant majority of EU decision-makers now demand European solutions for their data, driven by regulations like GDPR. This shift presents a powerful opportunity for MSPs to build higher-value, compliant services. The key lies in optimizing MSP object storage margins with a platform that eliminates unpredictable fees and guarantees data sovereignty.
Escape the Margin Squeeze from Hidden Cloud Fees
Many MSPs build services on hyperscale object storage, attracted by low per-gigabyte rates. However, profitability is often undermined by unpredictable operational costs. Egress fees, charged any time data is retrieved, can generate bills over 900% higher than the storage cost for a 10TB recovery. These charges, along with API call fees, are often billed in arrears, making them difficult to budget for and creating significant financial risk.
This pricing model creates vendor lock-in, as the cost to migrate a customer's data to another provider becomes prohibitively expensive. A European Commission representative has even described high egress fees as a punitive measure against data mobility. For MSPs, these hidden costs directly attack the profitability of backup and recovery services. This forces many to either absorb unexpected charges, damaging their own margins, or pass them on to clients, which harms the relationship. A predictable cost model is the only sustainable path to protecting storage margins.
Additional useful links
Federal Statistical Office (Destatis) provides statistical data on the use of cloud computing in German enterprises.
The German Data Protection Conference (DSK) offers a position paper outlining criteria for sovereign clouds.
PwC discusses cloud governance in Germany from a risk and regulatory perspective.
The German Federal Ministry for Economic Affairs and Climate Action (BMWK) presents information on the Trusted Cloud initiative and cloud computing version 2.
eco, Association of the Internet Industry, offers resources and information about cloud computing.
Bitkom (German Association for Information Technology, Telecommunications and New Media) published a press release on the demand for a German cloud solution.
FAQ
How can I migrate my client data without disrupting services?
Migrating to a fully S3-compatible object storage platform is designed to be seamless. Because the S3 API is used, your existing backup software (like Veeam, Acronis, or NovaBackup) and management scripts can be pointed to the new storage endpoint with minimal changes. We recommend a phased approach, starting with a non-critical workload to validate the process before migrating all clients.
Is your platform compatible with my existing backup software?
Yes. We offer full S3-API compatibility, which means we work out-of-the-box with leading backup and data management tools that support S3 as a storage target. This includes seamless integrations with Veeam, Acronis, NovaBackup, and many others, protecting your investment in existing software and skills.
How does your pricing model help me build predictable margins?
Our model is 'predictable by design.' We charge a flat per-GB storage fee with no egress charges, no API request fees, and no minimum storage durations. This means your costs remain stable and predictable, even when you or your clients need to restore large amounts of data. This allows you to set your service pricing with confidence and protect your margins.
What makes your cloud 'sovereign' and GDPR-compliant?
Our platform is sovereign because we are a European company that operates exclusively in certified European data centers. All client data and metadata remain within the EU, governed by EU law. This ensures GDPR compliance and protects your clients' data from the jurisdictional reach of non-EU laws like the US CLOUD Act.
Do you offer tools to help manage multiple clients?
Yes, our partner console is designed for MSPs. It offers multi-tenant management, allowing you to create and manage storage for multiple clients from a single dashboard. It includes features like Identity and Access Management (IAM), Role-Based Access Control (RBAC), and MFA to ensure secure, granular control over each client environment.
How do I get started as a partner?
Getting started is straightforward. You can contact our team for a demo to see the platform in action and discuss your specific needs. We have a fast onboarding process and our new distribution partnerships with api (Germany) and Northamber plc (UK) provide local support and resources for MSPs and resellers.
