Veritas Fights Back

The setting was the Ritz-Carlton Hotel on Nob Hill, one of the city's more guilded settings. It was here on Wednesday that Veritas officially rolled out a new version of Backup Exec, its best-selling backup and recovery software, and where newly appointed vice president of partner sales Michael Sotnick made his public debut.

Both introductions are likely to have significant impact on the channel. The product, version 9.0 for Windows servers, has plenty of new features and capabilities. They include integrated support of Windows; the fastest backup and restore of Microsoft Exchange e-mail servers; the first integrated support for Windows Server 2003, formerly known as .Net; and the first Internet-enabled interface that lets administrators monitor and manage backup from an Internet-connected PC. More than mere features, the upgrade to the 9.0 version sends a clear signal to the partner and customer communities that Veritas is not diminishing support for this product line or planning to bury it anytime soon.

The latter was something Veritas felt it had to make abundantly clear given the confusion over the product's future in the market. Veritas charges that CA, in particular, has spread sufficient fear, uncertainty and doubt that it had no choice but to come out and say that Backup Exec has a long history ahead of itself. Among other things, Veritas believes that CA's decision to name the latest release of ARCServe Backup version 9.0 was no coincidence.

"We've been listening for two years about how CA is coming after us in this space," said Veritas CEO Gary Bloom. "Despite their best efforts, they have lost share to us and now have a new upgrade to contend with."

Bloom went on to explain that the new product will have a significant impact on the channel because it will strengthen the hand of Veritas partners trying to increase their software sales. The reason: CIOs are trying to reduce the number of vendors they work with and instead go with a limited number of trusted suppliers whose portfolio are broad, diverse and integrated, Bloom said.

The Next Level

In addition, the appointment of a new channel vice president is one of many new steps Veritas is taking to upgrade its competitiveness, Bloom said. The company also has a new chief marketing officer in Jeremy Burton, and will soon have additional management in sales.

A company veteran, Sotnick has worked with partners in several capacities and, perhaps more important, knows Veritas inside and out. Teamed with Julie Parrish, senior director of channel marketing and a former 3Com program architect, Sotnick aims to enhance and update a channel program that is largely built out and running smoothly.

"This is about taking things to the next level," he said on Wednesday, his first official day in his new position.

The talent transplant is critical to Veritas, Bloom said, because it is one of several steps the company needs to take to improve its chances of reaching its goal of becoming a $5 billion software company. That's a goal that several other companies have set, but one that few have attained. Most recently, executives from BEA have outlined plans of becoming a $5 billion software company. But like those that have gone before it, BEA, too, has got hung up around the $1 billion plateau. That's around where Lotus, Novell and others hit some bumps as well.

Bloom, however, notes that with sales of $1.5 billion last year, his company has already blasted through that milestone, thanks, in part, to the steep investments in infrastructure that it has made of late. Knowing that mere infrastructure alone won't ensure its success, Veritas continues to build out its portfolio of products, which, today, includes solutions for data protection, storage management, high availability and disaster recovery.

That, of course, brings us back to Wednesday's announcement. Not known for splashy press affairs, Veritas bent over backward trying to accommodate the dozen or so members of the press who made their way up Nob Hill to the event. In addition to interviews with company executives, Veritas made available partners including Dell and a customer from GMAC's commercial finance division who said that Backup Exec literally keeps him employed.

Despite the posh settings, however, there was an unmistakable pall that hung over the event,no doubt attributed to the state of the economy, which, ironically, Bloom believes has stabilized. But others weren't so sure. The near empty hotel felt like a tomb save for the bored doormen and the cable cars outside were empty,one sure sign of how many people were actually in town. As for Veritas, the cloud over its head stems from an announcement made last week regarding the restatement of financial results dating back to 2000. The reason for the restatement: new thinking on a complex deal involving AOL. A change in accounting will mean that Veritas will report wider losses for 2000 and 2001. Although not significant to his company's overall financial heath, Bloom said the restatement amounts to the hardest thing he has had to do since joining Veritas. Fortunately for him, the deal did not take place on his watch, and the likelihood that there are other deals like that waiting to be discovered on Veritas' books appears small.

Nonetheless, the action suppressed at least somewhat the joy and confidence that Veritas is feeling at the moment. After all, Bloom noted in a interview after the press conference, Veritas gained share from competitors in each of the markets in which it does business. "We do enjoy a leadership position," he said proudly, without boast. "Now we build from here."