IBM Makes No Bones About Its Midmarket Agenda
DB2 Express is slated to be released early next year, the sources said. WebSphere Express Portal Server is due out at the end of this month, while WebSphere Express Application Server is slated to ship later this quarter.
DB2 Express will incorporate technologies that IBM obtained via its acquisition of Informix, such as Remote DBA and Remote Installation, which partners can use to support customers, company insiders said. Partners also can opt to resell IBM's version of those services. Packaging and pricing haven't been finalized, but IBM is considering a bare-bones version of DB2 for as little as $1,000 for midmarket customers, they said. IBM also is slated to incorporate more "autonomic",or self-tuning, self-configuring and self-maintaining,features from its new DB2 Release 8.1 into the Express lineup to offload work from the database administrator.
\
Mark Ouellette, VP of SMB Software Sales and Marketing, in front of a chart outlining the total SMB middleware market opportunity. The middle sections of the pyramid, the total midmarket ("M" in SMB) opportunity for middleware in 2003 will be $12 billion, growing approximately 7% YTY to $20 billion in 2006.
Though declining to comment specifically about those offerings, IBM executives said the company must be aggressive in the midmarket. "Overall, the SMB market is growing quite a bit faster than large companies," said Paul Rivot, director of database technology at IBM Software. "We also have quite a few customers and partners out there due to the Informix acquisition, and we're working with those folks in the transition plan to make sure we can meet their needs as they grow. There is an enormous installed base."
To jump-start demand, IBM starting this week plans to offer 90-day "triple zero" financing,that is, no money down, no payments and no interest,to midsize customers for their IT purchases, the company said. IBM also is beefing up its software financing in other ways, such as making qualified customers eligible to get interest rates as low as 3.1 percent and lowering the minimum purchase qualifying for financing to $25,000 from a previous range of $100,000 to $1 million, the company said.
Despite all of its resources, IBM has a tough sell, given that it's not exactly known for easy-to-use software, industry observers say. But the company is trying to change that perception. For example, WebSphere Express Portal Server consists of four CDs and takes just five clicks to install, said Mark Ouellette, vice president of sales and marketing at IBM Software.
Ouellette admits that IBM has to prove its user-friendliness mettle in the midmarket. "My job is to fix that issue. We have to establish credibility by delivering," he said. To that end, IBM Software plans to devote 20 percent of its $85 million advertising budget to the midmarket next year, he said.
Andy Sweet, CTO of Perficient, an Austin, Texas, solution provider, said IBM Software has shown it can execute on grand plans. "Two years ago, when IBM said it would take on BEA [Systems in app servers, obviously there were skeptics, but [IBM has done a good job there. They have a track record," he said.