Where is the online market?

By Nick Hortovanyi

Every time someone views my actual blog page (as opposed to reading it in a feed reader), it records some statistics about the visitor. I'm using a widget located at the bottom right hand side of my blog from ClustrMaps, to create the following graphic.

As an Australian, what intrigues me is how little traffic actually appears to come from Australia in comparison to North America and Europe. Its the barrier of distance that we need to overcome!

The internet allows us to talk to, to reach, to communicate and to influence people and businesses across the globe. Yet us Australians, spend the fair majority of our time selling in the offline world, to the people that we can see and touch and not to those larger potential online markets.

Why?

Uncertain times - can SaaS based applications be used to get an edge

By Nick Hortovanyi

I've been thinking a lot recently about what the potential impact may be to new IT projects with the recent credit crunch. Some believe that there will be increased belt tightening in business in general, with few new capital projects being approved.

Is this the opening that we should be looking for to introduce SaaS applications?

I don't think it will be. In the past, some basic primary research that I did, suggested that over 80% of ICT budgets was used to support existing systems. Out of the remainer of that ~20%, a similar percentage was spent on enhancements to existing systems. So if a capital project is required, to upgrade existing systems, the path of least resistance will be used to reduce risk. The status quo will be maintained to preserve existing operations.

What I'm looking for is those variables that are going to suggest a reduction in Op Ex budgets.

To me the driver is about improving the operating efficiency of business to allow them to compete more effectively against their competitors. So a smart business to me, will be looking to offset capital and op ex costs to get an edge at the moment whilst their competitors are distracted. So these businesses that break with tradition and use SaaS based applications, may just achieve that.

If you think you have spotted some doing just that, let us know.

IBM vs IBM in SMB - the competition continues

By Nick Hortovanyi

Following twitter the other day, I noticed a tweet by Ed Brill -  "I've been tempted to think about whether failed institutions used Notes vs. Exchange, but all of them are likely IBM customers somewhere.". I sent Ed a tweet containing a link to a blog entry I'd written previously on IBM vs IBM in SMB.

James Governor, picked up on it here in a blog entry and highlighted the issue of X Series advertising and success of IBM software in SMB. Mark Cathcart, jumped in here, with James supporting the case of the underdog (being myself, Aussies are known for coming from behind and winning). Mark commented on the very competitive nature of the x86 market, and eluded if they didn't advertise Microsoft software, they'd be out of business before you could spell b-u-s-n-e-s-s i-n-t-e-l-l-i-g-e-n-c-e. Thinking aloud here, is that why IBM is allowing Lenovo to license their X Series technology in certain areas?

But again his statement conflicts with the view of IBM Lotus as expressed on the comment left by Ed Brill. Through Lotus Foundations, Lotus are intending to deploy an appliance into these SMBs. This appliance will ultimately also have access to Lotus Bluehouse.  On a side note, the Lotus Foundations/Bluehouse scenario was what I was looking at eventually achieving five years ago, through WebSphere Portal Express.  I'm glad to see that Lotus Foundations runs Linux (no Microsoft required - finally Lotus getting off of Microsoft Operating Systems), think it might use an X Series server (but there is no mention of it that I can point to), and the focus is on your business, not IT. Am a little concerned at the focus on Lotus Notes (but it does allow Outlook connection, not sure about the Mac) but at the end of day, until Lotus Bluehouse is effective, its only email. So for an SMB, why not use Google Apps & Google Mail?

Mark mentioned a product called iDataPlex, which seemed to be targeted at ISPs or larger organisations. Not sure how many SMB organisations, need a "Right-size your Internet-scale data center" type infrastructure? This highlights to me, the difference in thinking between those that sell and support the larger end of town and those that support SMBs.

Its two different worlds, that are equally important but completely separate in what the immediate business drivers are.

Now I did agree about Mark's point regarding the support and incentive to sell, however that's useless if the customers don't want to buy IBM Software in the first place. The x86 hardware market is so competitive that it has now got to the point that it is not worth while quoting, as the winning bid (every one gets the special bid) on a large transaction will have a margin of 1% (that also needs to cover the cost of warehousing and delivery) for the business partner.

The point I'm making here is that the support and incentives are irrelevant, if IBM has not primed the SMB market using business intelligence itself to help progress potential buyers through the product buying lifecycle. I don't want to engage with the customer with an IBM product, if it is the first time they have heard about it. The sales cycle is just too long and hence then unprofitable with considerable training expenses.

In my experience, SMB customer's perceive IBM as IBM, not the individual brands, be it hardware, software or services that make up the organisation. If there is confusion, or mixed messages, they will go to other vendors with clear and consistent messages and experiences. Maybe that is one of the reasons Apple is starting to do so well (this blog post has been written on my Mac Book Pro).