Channel Marker - A SearchITChannel.com blog

Channel Marker:

 

A SearchITChannel.com blog


Commentary for value-added resellers (VARs) and systems integrators on partner programs, storage, security, networking and systems.

Database market share war resumes

It’s that time of year for the database market share squabble. IDC has released its numbers–at least to the vendors–and two of the three big database players are claiming victory.

From the snippets the vendors themselves release, it’s hard to draw conclusions. It’s like the blind men and the elephant: You can’t judge the entire gestalt from mere fragments.

On its earnings call last night, Oracle president Charles Phillips crowed about IDC data showing Oracle’s database share at 44.3% vs. 21% for IBM vs. 18.5% for Microsoft.

Read more »

Seized with doubt: CDW IT Monitor reflects buyer uncertainty

Has there ever been an economist willing to say we’re in a recession while the recession is actually happening? My own personal barometer of the economy (my husband who is a contractor) continues to have a very bizarre spring. After months of denial and a sort of lag factor, it appears that IT buyers are more nervous, too.

The CDW IT Monitor, which the reseller publishes on a bi-monthly basis, shows that slightly fewer businesses are planning to increase their IT budgets in the second half of 2008. That would be 50 percent vs. 54 percent in February. The data show that 8 percent are planning to cut their IT spending, compared with 6 percent.

CDW derives its monitor report from an online survey of about 1,000 IT decision maker reflecting all sizes of business and government agencies. You can spend some time with the complete findings here.

Generally speaking, there was less shake-up among the bigger respondents, which CDW postulates is due to the fact that budgets have already been approved (although who’s to say they can’t be cut!) CDW notes that at midsize companies, a sub-index tracking planned IT investment slipped 7 points from February to 70. There was also a 10 percent decline in the number of businesses that said they would hire IT staff in the next six months; 21 percent reported plans to hire, off 10 percent.

The good news is that the strategic value that survey respondents place on technology actually improved slightly: 83 percent reported said “yes” to notion that IT is “effective in achieving corporate mission and goals.” That was up 1 percentage point from 83 percent in February. So, that means demonstrating how technology can solve a business need is the way to make the case for a sale. Have at it.

Heather Clancy is a technology journalist and business communications consultant with SWOT Management Group. She can be reached at hclancy@swotmg.com.

Knowing your customer (or potential customer)

CDW recently released the results of what it’s calling the 2008 CDW Small Business Driver’s Seat Study, which taps more deeply into the motivations of technology buyers. The data is provides a fascinating snapshot of how an executive’s personal comfort levels with technology might affect the strategy of his or her company. They also provide some intriguing demographic insights, which I’ll get to in a moment.

For grounding, CDW’s survey covered 555 small-business executives in companies with five to 99 employees. Of those, approximately 127 responses came from African American-owned firms, 117 responses were from Hispanic-owned businesses, 152 responses were from non-minority-owned companies, and 159 responses were from woman-owned organizations.

So, one of the first things that’s worth pointing out from the data is that minority-owned businesses with five to 19 employees were more likely to hire an IT professional than the broader community of small businesses. Another area where minority-owned businesses tended to be innovators or technology leaders was in business continuity or disaster recovery planning. About 35 percent of Hispanic owners with busineses in the five-to-19 employee range reported that they had a plan, compared with 23 percent of all other businesses. Among companies with 50 to 99 employees, 67 percent of African American owners had invested in a disaster recovery or business continuity strategy, compared with 50 percent of the Hispanic owners and 48 percent of all owners.

On the flip side, though, minority-owned companies were less likely to have a server or remote access capabilities. Here’s just one illustrative statistic: 56 percent of all owners with five to 19 employees said they have invested in one or more server, while only 46 percent of Hispanic-owned or 47 percent of African American-owned companies said the same thing.

Here are some stats that might make for selling ammunition when you’re considered new approaches for your small-business clients:

  • Small businesses that considered IT as a strategic investment generally recorded faster growth than the average. Close to 70 percent of owners who reported they felt this way about technology said they posted annual growth of more than 10 percent, compared with 36 percent of owners who were more conservative about technology.
  • Minority-owned companies have an edge over the average when it comes to thinking about technology as a business driver.
  • Only 29 percent of the respondents currently employ a dedicated IT professional.
  • More than one-quarter of the small businesses surveyed said they regret not taking full advantage of the technologies they already own. Sounds like a great services opportunity to me.
  • When asked where technology has had the most impact on their bottom line, the small-business owners sited marketing and customer relationship management functions more often than other tasks. Which makes for an interesting self-searching question for VARs and resellers out there reading this that haven’t looked at these sorts of things for their own companies. Another top area where technology had impacted the bottom line for respondents was production/project management.

And, finally, here are the top five priorities that the surveyed small-business owners planned to achieve in the next three years.

  1. Have a formal business continuity plan (47 percent of respondents)
  2. Have a data warehouse and business intelligence tools (42 percent)
  3. Acquire off-site data storage and back up (37 percent)
  4. Provide industry-specific applications for staff (37 percent)
  5. Support mobile computing devices (36 percent)

Long-time business journalist Heather Clancy is a strategic channel communications consultant with SWOT Management Group. She can be reached at hclancy@swotmg.com.

Surprise! CDW research shows small businesses worried about IT spending

Yes, here I am, with more depressing economic news for those of you out there in IT services land who count on small businesses as your bread-and-butter clients.

CDW’s latest CDW IT Monitor shows that only 29 percent of small businesses expect their IT budgets to increase over the next six months. That compares with 53 percent of all the businesses responding to the IT solution provider’s bimonthly poll of IT decision makers, which encompasses the opinions at least 1,000 participants.

Still, the overall index stands at 73 for February, which is an increase from 69 last December.

In his analysis of the data, CDW Vice President Mark Gambill says that the lower scores for the small-business sector could be tied to the fact that small businesses generally see less perceived value in their IT investments than do midsize or large companies. The results show that 39 percent of small businesses believe that IT helps their bottom line, compared with almost 80 percent of the larger companies. That’s a big gap and one that VARs need to work on.Here’s a site where you can poke around more at CDW’s research.

What do you know about Web 2.0?

Forrester Research has some pretty terrific demographic research that tends to get me thinking. Yes, I know, frightening thought. One area it has been covering pretty closely is what it calls “social computing,” which is another way of talking about what other might lump under the category of Web 2.0.

Anyway, Forrester has released several predictions about social computing trends in 2008 that are worth your attention from two points of view. First, as a company that probably needs to market yourself more effectively and, second, as a technology solution provider. Here’s a synopsis:

  • Companies are more apt to use YouTube videos, social networking groups and Web site plug-in applications (a.k.a. widgets) as part of their online marketing campaigns. How much time have you invested in understanding how these tactics might affect your own prospecting? Considering that many VARs garner many of their sales leads by word-of-mouth referrals, this seems like a no-brainer to me.
  • Hiring tactics will need to reflect the addition of social networking and computing skills. Not to sound age-ist, but using YouTube and applications like Facebook comes more naturally to those among us who were exposed at a younger age. Some people aren’t necessarily comfortable using Facebook, but they WILL use LinkedIn. Anyway, encouraging experimentation will be important, and age will make a difference.
  • The concept of privacy will undergo a transformation as companies grapple with how to unlock the potential of social networks without infringing on the sanctity of personal information. That means adopting a new security discipline.
  • The concept of search will change dramatically because people will care more about knowing what people in their social network are reading or buying. That will have huge implications, over time, with how search engine optimization is handled.

There’s plenty more that will happen, of course, but that is just a taste. The question is whether or not you as a solution provider will be able to advise your customers on the technologies and applications that really will matter.

Heather Clancy is an award-winning business journalist and channel communications consultant with SWOT Management Group. You can reach her at hclancy@swotmg.com.

Will the IT economy go south in 2008?

I’m supposed to write some insightful list of predictions this time of year. Once I figure out what to say, I’ll get right on that. But first, I wanted to write about some survey results released a few days ago by uber-solution provider CDW.

The data, part of a report called the CDW IT Monitor , suggests that it will be harder for VARs and systems integrators to convince their customers to increase their spending plans in 2008. This will be especially true of small businesses, apparently, which isn’t great news for any solution provider focused predominantly on this sector. Only 38 percent of all the respondents (1,072 IT decision makers) plan to add more money to their IT budgets during the year. Breaking it down demographically, only 26 of small businesses intend to spend more compared with 46 percent of midsize companies and 43 percent of large companies.

One reason could be that small businesses aren’t having their expectations met: About 52 percent of them reported that technology had helped improve financial performance or efficiency. This compares with 69 percent of midsize companies and 71 percent of larger enterprises. (Incidentally, government agencies were even happier: Close to 80 percent of the decision makers report that they have realized an appreciable improvement in their financial bottom line as a result of implementing technology.
So, does this spell trouble for VARs and resellers betting big on small business? I’m choosing to look at things a little differently. Sure, it probably means that it may be tougher to sell your client on a brand-new, end-to-ind unified communications system. But things with a very clear return on investment potential—one you can demonstrate very clearly—may go a long way toward boosting both small business IT budgets AND their happiness with what they’re getting.

Heck, you’re out there living this every day. Why don’t you tell me? E-mail your observations, predictions, comments and so forth to Heather Clancy at hccollins@mac.com. Meanwhile, I’ll watch for the next CDW monitor, which is due out in a couple of months.

Heather Clancy is a high-tech business journalist who has been watching comings and goings in the high-tech channel for more than 18 years.

Resolve to under-promise and over-deliver in 2008

I get sort of stubborn about using my mobile gadget to bridge my person and business life. It’s pretty simple: I forget things.

This has caused all sorts of heartache for me in the past, especially when it comes to synchronizing my various smart phones with both my work and personal computers. Just yesterday, I realized on the train to New York City for a meeting that I had NO idea where said meeting was to take place. My software ate my homework, mom. Today, I’m still fighting with the application that caused the problem. But I will insist on using my iPhone.

So, I took a sort of sick pleasure from the findings of a survey released last week by Tata Consultancy Services, the big systems integration and consulting company based in India. At the highest level, its research shows that one-third of all IT projects fail to meet their original expectations. Sadder yet, 43 percent of the IT organizations surveyed say the business and board side of their business expects failure as the norm.

The most common misalignments are related to botched timing (cited by 62 percent of the respondents), budget (49 percent) and unanticipated maintenance costs (47 percent).

Mike McCabe, director of communications for the North American division of Tata, said the survey touched about 800 IT managers in companies with more than 250 employees. Tata actually conducted the survey to get a sense of how it performs relative to the industry norm. Since the integrator didn’t survey its customers with the same questions, it’s hard to draw any kind of concrete comparisons. However, McCabe says Tata delivers on time 87 percent of the time, which puts it in a relatively good position with respect to where most IT projects usually underperform expectations.

What does it mean for your own business as a solution provider?

It’s pretty simple: it’s so much easier to manage customer service when the customer knows what to expect. When you’re setting goals, honesty is the best policy and it may be better to walk away from an opportunity than to go into a situation knowing that you can’t deliver.

Time to recalibrate your thinking about printing and imaging

Been prepping this week for a presentation I’m giving on behalf of my colleagues at channel consulting firm SWOT Management Group to Oki Data’s solution provider advisory council (full disclosure on where my head is right now). So thinking quite a bit about printing and imaging. I know: Probably not your usual fare here at SearchITChannel.com.

In my days as a reporter, printers were, quite frankly, a bit overlooked as a coverage area. That is, until marvelous inventions like Adobe PostScript promised to pull these peripherals squarely onto the network and into the workgroup realm. The latest wave of innovation began when features from the office equipment world began to creep over—management software, scanner support and the like. In reality, if you sit back and mull the technology over a bit, today’s printing and imaging segment is one of those practice areas that could be a very logical, practical extension to your existing infrastructure practices in storage, security and collaboration.

Let me explain.

First, some market statistics. Gartner reported fairly recently that U.S. shipments of printers and copiers declined 4 percent in the second quarter. That is, printer sales declined 15 percent, but purchases of flatbed multifunction peripherals (MFPs) grew 19 percent compared with the second quarter of 2006. The color-enabled portion of this market is growing at a rate of 29 percent year over year, according to another market researcher, IDC. A related area, document scanners, is also posting respectable growth. Here’s some thoughts from market research company InfoTrends on the role of scanners. The transition to digital fax machines, of course, started happening years ago.

In my opinion, there are several dynamics driving this growth: new forms of business collaboration, as illustrated by software platforms such as Microsoft SharePoint; compliance regulations that dictate better document management policies and strategies; and the rise of Web 2.0-related portals that have made the job of managing content in both electronic and printed forms a whole lot more onerous. Of course, price points for MFPs have simply made the investment in these devices more worth it.

So how does this relate to something like storage? Think of printing and imaging as the front-end to the document management and workflow applications that have been slowly finding their way into business continuity and back-up solutions. You could even tie together a start-to-finish managed service: one that starts with an MPF, links into the appropriate software and archives accordingly, as business conditions dictate.

Similarly, protecting these documents with some sort of digital signature or encryption methodology could be a concern of your data security practice.

The fact that there are really no “standard” ways of handling documents, that every company’s workflow and retention strategy is probably slightly different, that this entire process really could benefit from ongoing management and services . These things make a printing and imaging solution look a lot more like an infrastructure practice than a commodity PC sale. Have you been thinking about it that way?

Another study shows end users’ lack of awareness

I have a friend who works for an IT help desk. A few weeks back, an employee called him up and asked — and I quote — “How do I use the Internet?”

Now, a new study by Trend Micro is confirming what most people (especially IT help desk employees) already knew: A lot of end users are clueless about the technology they work with daily.

This study specifically focused on Web threats — malware from the Internet that can install malicious software, steal sensitive information and use up a computer’s resources. Of the 1,600 end users who responded from the United States, United Kingdom, Germany and Japan, just 54% said they were aware of such threats. Germany had the most aware users at 63%, ahead of the U.K. (57%) and United States (54%). Only 43% of Japanese users said they were aware of Web threats, but Trend Micro said that data may be wrong because “Web threats,” as a phrase, “is difficult to translate into Japanese and is not often used.”

The results show that awareness of Web threats is “slowly” rising, Trend Micro said. The results also indicated that Web threats are the third most serious IT security issue, behind viruses and trojans. Other threats that received mention were pharming, phishing and spam. In a press release, Trend Micro’s anti-malware CTO, Raimund Genes, said Web threats are “perhaps the greatest challenge to protecting the privacy of personal information and the confidentiality of corporate information.”

As vendors are wont to do with these kinds of studies, Trend Micro uses these results to push the need for “a multi-layered, comprehensive set of techniques … to address the newest class of threats” — in this case, the Trend Micro Web Threat Protection Strategy product.

A chance for the channel to compete with RFID

The last few days have not been kind to radio frequency identification (RFID).

ABI Research reported today that Wi-Fi is “muscling in on RFID’s location-based services markets,” predicting that the market for Wi-Fi as a real-time location services (RTLS) provider will grow by more than 1300% over the next five years. That forecast came just four days after the managing director of Heavey RF, an Irish firm, issued his own report calling RFID “potentially one of the biggest technical blunders in history.”

The Heavey RF report says that RFID has a place in the market but will never fully live up to its hype because it is less reliable and cost effective than bar-coding. If you agree, that opens the door for a new technology in the RTLS market. Enter Wi-Fi, whose revenues in the market will increase from $59 million this year to $839 million in 2012, according to New York-based ABI.

“In the past, companies wishing to deploy RTLS had to buy proprietary RFID systems, inlcuding very expensive readers,” said Stan Schatt, ABI’s vice president and research director, in a statement. “But there is now such a large installed base of Wi-Fi equipment worldwide that Wi-Fi-based RTLS becomes cost effective for companies that had never considered it before.”

ABI recommends that vendors — including market leader Cisco and main competitors Aruba and Trapeze — work with channel partners who have RTLS experience to best take advantage of this new opportunity.

“It is a sophisticated solution that requires a knowledgeable reseller,” Schatt said.

ABI pointed out several benefits of Wi-Fi RTLS over RFID: Users that already have wireless networks don’t need to install extra cabling, and it utilizes specialized software to maximize its effectiveness. But there are also some problems with Wi-Fi RTLS compared to RFID, according to ABI: It’s “somewhat less accurate,” less secure and requires more wireless access points.