SMBs Get Market Respect

The non-enterprise business is the new model for storage networking products

October 19, 2007

4 Min Read
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If you work for a business with fewer than 1,000 employees, you're no doubt aware that storage networking suppliers have you in their sights. But you've probably noted an uptick in the pitch level lately.

At the SNW tradeshow in Dallas this week, numerous vendors pounded the SMB skins with fresh vigor. And while they've courted the segment for years, many suppliers now seem more serious about actually changing their products to fit the needs of smaller businesses.

What's driving the SMB (small to medium-sized business) revival? One factor is the ongoing growth of iSCSI, which is viewed by key providers as chiefly an SMB technology.

"We expect that over time, iSCSI will be a popular choice in lower segments of the market, particularly for those who have not or won't invest in Fibre Channel, but who have enough pain that will move them to networked storage," states IDC analyst Brad Nisbet.

IDC predicts that sales for products priced in the "under $5,000" range will grow an average of 184.3 percent annually through 2011, compared with growth of 52.4 percent for products priced between $15,000 and $50,000.The iSCSI ante was upped when Michael Dell introduced his company's iSCSI arrays last month with the accusation that SMBs had been "underserved" by storage suppliers who've simply "dumbed down" enterprise products to fit smaller businesses, without considering the specific requirements those businesses have.

What are those specific requirements? At this week's show, there was no shortage of opinions on that topic. Here, culled from encounters at this week's show, is a sampling of factors that supposedly distinguish SMB buying patterns from those of higher-end customers:

  • Longer TCO: Large enterprises have the luxury of upgrading their capital equipment more often than do SMBs. For this reason, SMBs should demand a four- to five-year TCO profile from prospective buyers, according to Jay Kramer, VP of worldwide marketing at iStor Networks. In a presentation at this week's show, he encouraged users to include a range of costs into the five-year plan: software and hardware capex and licensing; cost of personnel training and certification; costs of initial support and ongoing fixes, such as performance tuning; and energy costs.

  • More negotiated cost tradeoffs: SMBs need to leverage their vendor relationships with a more aggressive view to cost savings. For example, Kramer suggests, if a vendor wants a customer to provide a testimonial about the product, the customer should ask the vendor to create and implement an ROI plan for free.

  • Different product criteria: "Small businesses have an amplified need for simplicity and automation," Kramer said during his talk. Smaller companies specifically need to look at ease of installation, easy-to-use GUIs, wizards for non-technical folk, reporting tools, and monitoring aids. The ability to boot from SAN, a feature of most SMB iSCSI products, is key, he said. "The ability to have a single boot image that can be quickly brought up across multiple servers is really a value add."

  • More reliance on channel partners: Since many SMBs buy from local integrators, it's important to find a good one. The quality of a VAR or integrator's training, support, and product portfolio should all be considered. "Evaluate channel partners for their support of other storage food-chain products," Kramer said.

The above list is just a sampling of the way market suppliers are thinking -- and rethinking -- about SMBs. But users have heard much of this before. Is there evidence that vendors are truly changing their tune?

The proof of solid change will come with ongoing product traction. But at least one supplier shows the seriousness that can accompany the new take on the market. George Symons, ex-EMC exec who signed on last year as CEO of Yosemite Technologies, has completely shifted his company's mission from a focus on enterprise customers to one that favors the firms' original SMB stance.

"We lost our way a bit a couple of years ago," he says. "We went to the enterprise market and realized that 'scaleable' does not mean 'enterprise.' " The company has launched new SMB products to emphasize its reforms.Given the level of SMB rhetoric recently, we're likely to hear much more in this vein in the foreseeable future.Have a comment on this story? Please click "Discuss" below. If you'd like to contact Byte and Switch's editors directly, send us a message.

  • Dell Inc. (Nasdaq: DELL)

  • EMC Corp. (NYSE: EMC)

  • iStor Networks Inc.

  • IDC

  • Yosemite Technologies Inc.

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