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Suddenly, storage vendors have woken up to the SMB market

Feb 28, 20063 mins
Data CenterIBMSmall and Medium Business

* Storage vendors on the war path for SMB dollars

The approach that the large software vendors have taken when it comes to small and midsize businesses reminds me of an expression my co-worker Phil sometimes used in the days when we worked together at Symbios Logic. When referring to issues we had never gotten around to addressing, he would sometimes offer that: “We have admired that problem for years.”

In fact, SMB and its problems – at least when it comes to managing storage – have indeed been admired (and ignored) for years by the large vendors. That had to change of course – this is the point where our friends in sales remind us that one company’s problem is another’s opportunity – but for decades most of the bigger companies, Veritas notwithstanding, ignored SMB and chased larger opportunities. Clearly, with recent releases from CA and EMC, things are starting to change. At last, a badly under-served market is getting some attention.

IBM’s Tivoli software group recently announced the release of Tivoli Express, a package of software tools aimed addressing a plethora of IT issues in what the company has described as both “mid-market” and SMB. The company hopes to increase its presence in the SMB world by providing a software bundle that offers simple, fast and secure IT management. It will come as no surprise to you that storage management is a key part of this bundle.

We’ll talk about the content of IBM’s Express bundle next time. Right now however, I have to raise the issue that companies the size of IBM – well, there aren’t a whole bunch of those, so let’s talk about “very large software vendors that traditionally have offered enterprise-level storage management tools” – often have a hard time creating products that work well for smaller companies. For CA, EMC, IBM and HP this has been an ongoing problem for as long as any of us can remember. Only lately have they started to deal with the fact that much of their future growth may be linked closely to how well they serve that market.

The sudden realization of the importance of SMB to these large vendors results in several key insights, all of which will appear to most of you to be mind-boggingly obvious.

Insight No. 1: This is the Willie Sutton rule (for those of you outside the U.S., Willie Sutton was a famous American bank robber in the 1930s who, when asked why he robbed banks, replied: “Because that’s where the money is”). SMB is an untapped and needful market, and is out there waiting for someone to pay attention to it.

Insight No. 2: The market for larger machines and larger storage management packages is growing at a lesser rate than SMB. Additionally, the problem to vendors of dislodging an incumbent provider is likely to be easier than dislodging a competitor at enterprise opportunities. So sales into the SMB market, particularly for companies with the smarts to listen to their local sales partners, are in many respects going to be easier.

Insight No. 3: Today’s small company may not be so small next year, and may be ready to upgrade to a vendor’s enterprise class software line the next time around or soon thereafter. If a vendor gets embedded as a part of IT services when a company is small, by the time the company grows it has become the incumbent and can offer the now much-larger client an easy growth path.

And so, IBM today is rolling out “Express” versions of its management software. We’ll look at what IBM has to offer next time.