SHI International Mounting Cloud Services Assault With New Data Center

SHI International (VAR500 2010 Rank: 49), a $3 billion software reseller that has expanded its solutions footprint in recent years, is investing $20 million in a new data center in a bid to become a major player in the cloud services market.

The Piscataway N.J.-based solution provider power, one of Microsoft and Hewlett-Packard's top partners, is scheduled to open a $20 million cloud services data center in Somerset, N.J. that will be fully operational next July, said Henry Fastert, chief technologist and managing partner for SHI. "We believe cloud services are a new important requirement for our customers," he said.

SHI International plans to begin providing proof of concept cloud services including infrastructure as a service offerings beginning in March at the facility, which will also double as SHI's corporate headquarters, said Fastert. The facility, which was purchased by SHI earlier this year in a transaction overseen by Jones Lang LaSalle, is a former AT&T facility that has been vacant for nine years and is being renovated by SHI.

The new cloud services data center is the first of six data centers across the country that SHI plans to use to deploy "industrial grade" virtual machines for what it is calling its new Infrastructure-as-a-Service (IaaS) offering. Those virtual machines can be used for everything from application development to disaster recovery or software-as-a-service (SaaS) for businesses of all sizes, said Fastert.

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SHI also plans to provide what it is calling infrastructure-as-service "burst" functionality that can be scaled up or down at a moment's notice depending on customer requirements.

SHI's primary competitors in the cloud services market are are Rackspace and Savvis, which are providing robust cloud service offerings for businesses, said Fastert. "Our customers are hard-core infrastructure customers," he says.

Rackspace, for its part, is teaming with solution provider partners to fulfill its cloud services vision. Savvis, meanwhile, has a broad range of cloud services for public and private clouds including infrastructure as a service offerings.

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SHI is already providing what it is calling next-generation data center services including infrastructure services, information security and risk management, data center management and automation.

Fastert, who previously directed the professional services organization at Unisys, was hired by SHI 18 months ago to launch a full fledged professional services group that is responsible for the cloud services business. He has already hired over 100 people and now oversees a group of 147 professional services employees providing cloud services and data center consulting.

Those professional services employees are teaming with an 800 member strong sales force that includes 430 outside sales reps and 15 senior data center sales reps charged with training, mentoring and "enabling" the sales force for the complex data center and cloud services and infrastructure as a service sales proposals.

Fastert, who spent 16 years at HP, including a stint as a principal architect, along with his data center architect team selected HP networking products as the foundation for the new SHI International cloud services data center.

At HP's Americas Partner Conference earlier this year, HP's Enterprise Storage and Networking Group awarded SHI International the top cross portfolio revenue growth award.

The HP networking virtual switching technology along with the HP Intelligent Management Center product, which enables a single console network management platform, were critical factors in selecting the HP gear that has a list price of some $11 million, said Fastert.

Fastert sees the cloud services offerings from SHI as a "logical extension" of the services that it has provided 7,000 plus customers for the last 20 years. "This is just another services that we are adding to all the things that SHI has done for them in the past," said Fastert.

SHI has for years provided software asset management which will be a critical part of its cloud services offering, said Fastert.

"SHI has a sterling reputation with its customers," he said. "We have customers for the long haul. The average length of time an account manager is in an enterprise account is in excess of 12 years. Customers know us and trust us."