Mimecast’s Price Hike Leaves MSPs Scrambling

Mimecast’s Price Hike Leaves MSPs Scrambling

Mimecast, an email security and archiving company, recently announced a surprise new pricing model for its cloud-based services. Unfortunately, this surprise isn’t a pleasant one, with rates set to become much more expensive than before. In fact, the new price is so high that Mimecast recommended other options for smaller businesses in a follow up email to their price announcement.  

Mimecast has made the decision that they should focus on bigger fish, leaving SMB’s scrambling to figure out what to do next.    

A Few Words from Mimecast

If you’re wondering why Mimecast is raising their prices to unaffordable levels, they’ve given their reasons in an explainer email. The full email can be read below, but some noteworthy excerpts include:

“In order to best serve customers of all sizes, we made programmatic changes to how we price and package our solutions to small organizations. We have a renewed focus on those who are most concerned with advanced security and archival use cases, which is where we see the bulk of the market opportunity for partners, Mimecast, and of course our mutual customers.”

“As an MSP, if you have smaller customers who only care about isolated targeted threats or advanced archival, then the logical choice might be offering them Microsoft native 365, as it should support them sufficiently and allow you to continue to add value and price the service effectively for your SMB customers.” 

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Screenshot of email sent by Mimecast

The Problem

Here’s the issue: many businesses have recently transitioned their services to Mimecast due to MacAfee SaaS Email Security Product Line shutting down this month. 

Intel/McAfee did the right thing in giving their partners ample time (over 1 year) to find alternative solutions for SaaS Email Security. Managed service providers had hundreds to thousands of users set up with Intel/McAfee. Finding a new solution that provided the same ease of use, price point, and quality that Intel/McAfee provided to their partners for years wasn’t easy. In the end, many MSPs decided on Mimecast, despite a higher cost, because it provided the best protection and uptime.

MSP’s have spent the better part of the past year pitching Mimecast as a replacement and setting up clients with the service. After configuring thousands of end users with Mimecast MSPs are rewarded with this suspiciously timed price gouging maneuver.

Our Take

It appears that Mimecast knew they had their MSP partners’ captive, and decided to damage them just to improve their profit and stock price. Their decision is short-sighted and will cost them MSP business and market share long-term.

We are exploring other providers who value their MSP partnerships, discuss price changes well in advance with their partners, and hold to a code of ethics that matches ours. We value transparent businesses that put the customer first. Always.

Written by Nik Vargas