Life after IBM is all green for ISS co-founder Tom Noonan

Noonan's JouleX seeks to redefine energy management technology

Tom Noonan embraces life after IBM with JouleX, a green IT company.

It was 2006, and Tom Noonan had it all. Internet Security Systems (ISS), the company he co-founded and led as CEO, was pulling in $400 million in annual revenue and on the verge of being acquired by IBM for a whopping $1.3 billion.

But instead of reveling in IT vendor glory, if there is such a thing, Noonan was reminiscing about the early 1990s when fellow ISS co-founder Christopher Klaus lived above Noonan's garage in Atlanta, and the two started building what would become one of the biggest organizations in tech security.

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"All the damn Sarbanes-Oxley meetings and discussions with lawyers and CFOs," Noonan says now, when looking back at ISS's final days. "It wasn't nearly as fun. It was much bigger. We were much more famous. We were much richer. But it wasn't as much fun. I mean right now, this is where the fun is."

The thing "right now" for Noonan is a green IT company called JouleX, which is attempting to change the way businesses monitor and manage the power used by IT equipment and other devices connected to computer networks.

As CEO, Noonan is putting in nearly 90 hours a week, and brought his team to the Interop conference in Las Vegas this week to launch JouleX, which had been operating in stealth mode. (Take our Interop history quiz.) 

Until about 20 months ago, Noonan was a senior executive at Big Blue, helping integrate ISS into the mammoth, 350,000 employee-strong IBM. It wasn't for him.

"We sold ISS to IBM. I had integrated the company and [completed] my commitment to IBM," Noonan says. "It's a different experience. It's not stifling for them because all that protocol is the way they operate a company of 350,000 people and I completely understand it, but it's not a game I wanted to play. At 45 years old I did not want to start a career at IBM."

Since leaving IBM, Noonan has started a venture firm called Tech Operators that is investing in 27 companies, and helped start Endgame Systems, which makes software vulnerability analysis tools and other security technology.

But Noonan's main focus is JouleX, which has 12 employees. Although Noonan is president and CEO, he says the credit for building JouleX's technology goes to chief architect Josef Brunner and CTO Rene Seeber, Noonan's fellow co-founders.

Seeber, previously the ISS chief scientist for content security products, and Brunner initially founded JouleX in March 2008 to solve a security problem, but a sequence of events caused them to switch their focus to energy management.

"They were working on a security problem for a large smart meter company in Europe," Noonan explains. "The more they looked at data, the more they realized that the power consumption of an unoccupied, unproductive building is about exactly the same as a productive, occupied building. The thought changed from security to power management. Clearly, something inside these buildings was consuming huge amounts of power and it didn't take a rocket scientists to figure out it was the IT infrastructure."

JouleX and its main technology, the JouleX Energy Manager, is based on a simple architecture. It's a single piece of software that is installed on a PC or virtual machine, usually in about two hours, and provides remote monitoring, analysis and management of all devices connected to the IP network. While vendors like 1E and Verdiem focus on PCs and servers, JouleX looks at essentially any device controlled by a computer, whether they are lighting systems, HVAC, VoIP phones, or wireless access points.

Noonan jokingly suggests that eventually "somebody is going to IP-enable a toaster," adding it to the list of devices managed by JouleX.

While JouleX's headquarters are in Atlanta, its main development center is in Kassel, Germany, and most of its early customers are in Europe. Siemens has deployed JouleX Energy Manager in two facilities.

At Siemens, "when the employee badges in in the morning, everything associated with that employee is turned on, their lights, their PC, their monitor, their printer, their wireless access points in their area," Noonan says. "When they badge out it's all turned off. And if they don't come back for a month it won't turn on for a month."

JouleX's approximately 15 customers include SwissCom (which is tracking 300,000 devices with Energy Manager), BMW, Daimler, and Deutsche Bank, and Noonan has had discussions with officials at Google about potentially installing the Energy Manager in Google's facilities.

"They're very interested in it because not only do they have data centers but they've got literally hundreds of thousands of IP-connected devices operating across their office networks," Noonan says.

One of JouleX's primary selling points is that, as a single piece of software, it doesn't require any agents to be installed on network devices.

"There's not a business we're familiar with that is asking 'can we have another agent to install on our PCs and servers,'" says Tim McCormick, vice president of sales and marketing for JouleX. "It just doesn't scale, it's too costly, you can break things on production equipment. It's just fraught full of problems."

The open nature of network and systems management tools makes it relatively easy for JouleX to gather the power information it needs, McCormick says. Even with virtualization technology dividing physical servers into multiple logical entities, JouleX can read the power usage of each individual virtual machine and make recommendations to lower energy costs. One customer that's piloting JouleX is using VMware's live migration to move applications from one data center to another to take advantage of lower energy prices.

Joulex has $2 million in venture funding (largely from Noonan's Tech Operators firm) and only about $200,000 in revenue so far. Numerous energy management vendors are being formed to help businesses deal with the rising cost of energy and proliferation of power-hungry IT equipment, meaning JouleX will be just one of many options for a cost-conscious CIO.

But Noonan argues that the market has no clear leader as of yet, and thinks JouleX offers a unique value proposition. JouleX's software licensing costs will be about a third of the amount customers save by using the technology. Hypothetically, if a 5,000-employee company saves $300,000 a year using JouleX they would pay $100,000.

"We're trying to structure the pricing model so that it's almost a no-brainer, meaning every day you don't use this you're spending more money than you need to," Noonan says.

Although Noonan's focus today is green IT, he's keeping close tabs on the tech industry as a whole. He says healthcare technology is another market primed for growth. And security, where Noonan had his biggest success, still has room for new innovation, particularly when it comes to improving the safety of cloud computing and virtualization, he says.

Noonan seemed excited to be back at Interop, the network technology conference where he delivered keynote addresses in 2005, 2006, and 2007. Now he's hawking his product on the show floor in what Interop calls "Startup City."

Noonan talked of "staying up all night, talking and drinking," but he says he won't actually place any bets.

"I'm not much of a gambler. I do all of my gambling in technology," Noonan says. "As many times as I've been to Vegas I've never gambled once. I am the classic reason why Vegas hates to host technology people."

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