Crunching numbers
Virtualisation, according to Dell, is a strong proposition in the SMB space – which in turn is a large potential audience for the vendor and its channel network.
“If you look at the SMB market in Australia, there are around 1.2 million SMBs, of which about 800,000 have some sort of IT requirement,” Dell channel director A/NZ, Jay Turner, said. “If you look from a medium-business perspective, there are probably only 40,000-50,000 really medium-businesses in size.”
In the SMB space, organisations are interested in how to save money, and continue saving money over a three- to four-year purchase cycle. This drive may well cause virtualisation to be the first stage, or entrée, into entering a fully virtual relationship in the future. That SMBs are also looking to outsource their IT infrastructure lends further credence to this trend.
“SMBs shouldn’t really have to be able to even spell virtualisation to be honest,” Turner said. “It should be part of the overall deliverable that their IT support organisation provides them with. That’s where I think the successful channel partners in the future are.”
Dell has also observed an interesting trend develop when interacting with SMB customers and partners through various events over the past 24 months. A large number of SMBs have, in their heads, done some virtualisation, but in reality, what those customers have virtualised amounts to less than 10 per cent of the environment – a very tentative step into the virtual world.
Beyond the initial investment to put virtualisation into the IT environment, SMB customers are leaving the deployments with the low-risk parts of their environment alone, and not gone near the critical applications. Because of this, partners can find opportunities in revisiting those organisations and demonstrating that virtualisation technology has continued to progress and mature and is now more robust and capable.
Once a business case for a greater range of applications – including the critical ones –to be placed in virtualised environments, partners have a great opportunity for double-dipping with those SMBs that had previously been so tentative in adoption.
Picking the right attack strategy
Early this fiscal year, VMware released a product called VMware Go – a virtualisation solution specifically targeted at the SMB market. VMware Go comes with a Web-based interface and a wizard to guide the SMB through installation and set-up – an attempt to mitigate any lack of technical skill an SMB’s (possibly non-existent) IT department or manager might have. From there, users can easily create virtual machines and exercise basic management tasks on those machines and ESXi servers.
VMware clearly wants to penetrate into the SMB space. The vendor also recently created a director of commercial sales position to focus on the lower end of the market.
But it’s not that easy. The product, while within the abilities of the SMB to deploy and administer, is not really what that market is looking for. As explained earlier, SMBs aren’t looking for mere product sets, they’re looking for an overall solution and in that regard, they’ll still need a channel partner to complete the rollout for them.
“The role of the trusted advisor is very important here, and also they need to hide all the complexity – they’re going to tell their clients that it’s easy and they don’t have to worry about it, but at the same time they can flip a switch and get it working – that’s what SMBs want,” IDC program manager for IT spending, Jean Marc Annonier, said.
“The initial conversation to be had with a customer is ‘why would you want to do that?’ It’s not to be challenging, but rather, to be inquisitive.”
For example, is the issue about reducing the footprint of infrastructure equipment the customer is buying? Is it about trying to make the infrastructure they’re buying more flexible and dynamic in terms of being able to deploy new software, new servers and new applications quickly?
“At the server level, the driver is not virtualisation, it’s about consolidation, or the ability to build a dynamic environment,” Microsoft director of server business group, Philip Goldie, said.
“What we are trying to do, especially through our partners, is enable the discussion around some of the other benefits of virtualisation and effectively a virtualised infrastructure. That could be anything from the ability to save money on hardware, to the ability to manage that infrastructure properly.
“The discussion I’m interested in having is what’s the difference between me building that infrastructure, and me buying the infrastructure through a cloud service, and how would that look in the future?”
Moving forward
There’s little doubt virtualisation can aid SMBs. As with organisations of any other size, SMBs are feeling pressure to consolidate costs and make the most from IT purchases.
The challenge for vendors and their partners is that those same potential customers don’t necessarily understand virtualisation, and then don’t necessarily care about specific technologies.
The upside to this is a wealth of opportunities to act in an advisory and support role. Properly understanding the needs and capabilities of the SMB customer is the key to turning a massive potential customer base into a lucrative venture.
