Curvature, best known for selling Cisco gear on the secondary market; and SMS, which provides maintenance services for servers and storage equipment, have merged.
The new company, currently called SMS Curvature, aims to grow the business of third-party maintenance for a range of IT equipment by offering repair, replacement, and on-site engineering services at a fraction of the price of typical vendor support.
The company will also continue to sell used networking and data center equipment on the secondary market, but it sees maintenance as the greatest opportunity for growth.
“Once you buy a product from a VAR, we want to help you with everything you do with it for the rest of its life,” said Mike Sheldon, president and COO of SMS Curvature. “If it breaks, we fix it. If you want to upgrade it, we can upgrade it. We can dispose of it environmentally. We want to control that lifecycle.”
According to a 2016 Gartner report, third-party maintenance is, on average, 60% less expensive than the list price of traditional OEM support. The Gartner report also noted that in some cases, customers have seen up to 95% savings.
Three Years In
SMS Curvature sees its largest opportunity in supporting equipment after the first three years of its purchase, or when an OEM’s original warranty expires but a customer doesn’t want to upgrade equipment.
“The manufacturers use maintenance as a tool,” said Sheldon. “You buy a switch, you buy a three-year maintenance warranty, but in the fourth year they won’t sell you a warranty, they want you to buy a new switch. We step in after the third year.”
By extending the life of the equipment, customers can not only reduce maintenance costs, but also defer capital expenses.
“We continue to support you, and let you kick the can down the road on the upgrade,” said Sheldon.
While companies like SMS Curvature can offer compelling savings, they also face significant perceptual hurdles. For instance, customers may be concerned that they will get inferior-quality products, or even counterfeit equipment. And some customers worry about souring relationships with key vendors by going to the secondary market.
Sheldon is keenly aware of these hurdles. He said if a customer is suspicious about a particular piece of equipment purchased from SMS Curvature, the company will replace it.
The combined companies will have a global footprint to provide maintenance and support, with offices in North America, Europe, and Asia. Maintenance and support are available for major IT brands, including Cisco, HPE, Dell EMC, NetApp, Oracle, and more.
The company has over 2,000 employees, and says its combined annual revenue is $541 million.