Expanding The Sphere

IBM has been criticized in the past for failing to adequately meet the needs of its small-to-midsize ISVs, while catering heavily to its largest applications partners in co-development lab settings. Today, the company is trying an approach that involves more hand-holding, personalized support and better pricing.

"IBM has stepped it up over the last year," says James Adamek, executive vice president of business development at FullTilt, a King of Prussia, Pa.-based ISV whose product-information application was ported over to WebSphere Commerce server last year. "What we really liked is that they opened up their development organization to us and assigned us local resources."

Courting WebSphere ISVs is part of Big Blue's broader strategy to create products and programs that widen its influence beyond the biggest enterprises into the vast and potentially lucrative SMB space, according to company officials. It's a market where Microsoft is currently king, famous for its champion coddling of the ISV community. IBM wants more of that action and clearly sees an inroad with developers.

"We are utilizing the know-how from our Fortune 500 partners and putting all of our efforts into the SMB market," says Laura Voglino, director of WebSphere channel programs at IBM in Raleigh, N.C. "It's a very strategic investment for IBM."

The company is committing $1 billion in product development, marketing and partner/ISV programs tailored for the SMB market in 2003, according to Voglino. At the core of this initiative lie the WebSphere Express products, which were introduced late last year as pared-down, more competitively priced versions of the WebSphere application, portal and commerce servers.

This could be an opportune time for IBM to go after more ISVs. In the J2EE arena, BEA Systems historically has grabbed the attention of hordes of ISVs with its competitively priced WebLogic application server. But the tide is beginning to shift, as IBM's WebSphere gains more market share.

"The basic economics are what drive the thinking of ISVs [on platforms]," says Mike Gilpin, an industry analyst with Giga Group.

Many of IBM's ISV efforts of late are aimed at encouraging Java developers to build new or port existing applications over to the Express products. The 2-month-old Express Enablement program, which to date has attracted 600 partners serving the midmarket, comprises a raft of developer resources, including downloadable technical tools and plug-ins, and online education that ranges from Java programming tips to instructions on how to use WebSphere Portal Express to build a portlet. Beyond the self-service options on the developer site, IBM also offers collaborative tools, including phone support and e-mentoring sessions in which ISVs can communicate via instant messaging with IBM techies.

In addition to technical documentation, the site features a set of third-party ROI tools that enable SMB partners to help their customers conduct cost/benefit analyses of using WebSphere Express and particular applications. The Enablement program also sports an e-lab that gives developers access to an IBM server farm on which to test their applications before deployment.

Many of these resources mirror similar offerings from Microsoft, but reflect a shift within IBM to be more sensitive to the needs of smaller ISV partners.

"The midmarket requires solutions more than products, and those solutions need to be easy to understand and implement," Voglino says.

The other key component in IBM's support arsenal is its WebSphere Innovation Centers,29 locations worldwide where developers can go for training, troubleshooting and testing. Eight of the centers are run by IBM, while 21 are operated by key Big Blue business partners, including Arrow Electronics and Valtech.

Alex Attal, CEO of Paris-based Adonix's U.S. subsidiary, gave high marks to IBM for its support of his company's porting of X3, a midmarket ERP suite, over to WebSphere Express application server. Adonix was one of approximately 10 ISVs worldwide to whom IBM gave a beta version of WebSphere Express and solicited feedback, Attal says.

"I was impressed that they wanted to get our view on how they should build [WebSphere Express]," Attal says. "They went to our development team, told them to test it and to see how it would bring value to X3. And they wanted to know if our customers would buy into WebSphere as a platform for our applications."

Attal says IBM took many of his recommendations to heart, including those insisting on simpler pricing structures and better selection of distribution channels appropriate to the midmarket. Attal also made technical recommendations for functionality that the midmarket covets most, including embedded security and Web-development tools, and the complete integration of applications into the platform. "The midmarket does not want WebSphere alone," he says.

"We also discussed the technical value proposition in comparing WebSphere Express to what is free on the market, like Apache," he says. "The customer has to be convinced he's getting something more technical from IBM to spend the additional money."

The WebSphere version of X3 was released Feb. 10, and Attal says it remains to be seen how the new version will fare with Adonix's network of VARs, which accounts for 80 percent of its sales. Attal cautions that IBM must be diligent in retooling its sales and marketing pitch to the midmarket,something he's not totally convinced Big Blue has done yet.

Mike Ostrowski, professional services manager at Optimus Solutions, Norcross, Ga., says IBM has blanketed his company with assistance related to WebSphere development and implementations, including assigning one IBM partner contact to deal with Optimus and hosting free training programs before new software is released.

Where IBM could do better, Ostrowski says, is in being more sensitive to the time, effort and expense required each time it pronounces a new technology focus to its partners and ISVs. Case in point: last year's emphasis on WebSphere Portal Server, he says.

"For us to get up to speed and become gurus is expensive, especially when you don't know what the returns are going to be," says Ostrowski, who acknowledged that many of the IBM developer resources come free of charge. "Where the expense comes in [is] the loss of time when our consultants are not billing and developers are in training."

Cost hasn't been an issue for David Mavashev, CEO of Melville, N.Y.-based ISV Nastel Technologies. Mavashev says he's been pleased overall with the pricing,or lack of pricing,associated with IBM developer support and technical resources, and with the discounts given on IBM software, hardware and development tools. Nastel develops applications for managing WebSphere products, including MQ, Business Integration and the application server. The company, which is an Advanced Partner to IBM, also has added JMX extensions to IBM's MQ EveryPlace product.

"In our case, anytime we had to get something from Microsoft or Sun, we had to pay," Mavashev says. "This is not our experience with IBM. I told Sun once, when filling out a survey, 'You have a good product, but now you are asking ISVs to pay this and that.' Whom do I support more, Sun or IBM?"