Trip report: Observations from IP EXPO Stockholm
Last week we had the opportunity to present at the Virtualization theatre in IP EXPO’s Stockholm event. We were able to discuss IT marketing trends in Sweden with the event management team, review motivation for participation with delegates who came to the presentations, and review expected return-on-investment with sponsors. As analysts who have been tracking IT industry developments for almost 30 years, it was fascinating to reflect on what has stayed the same, and what has changed.
Symantec journeys through transitions
On May 2nd Symantec announced full year results for the year ending 31 March 2012, with revenue growth of 9% to $6.7 billion and operating margin increase from 14% to 16%. We believe the company is making its way through two significant transitions relating to its consulting business and the move from license to as-a-service sales. The challenge for Symantec will be to sustain momentum. As markets converge, we should see Symantec leverage its experience across segments. Staying the course with its approach to services is likely to be just as challenging. And as we saw in earlier analysis of Dell, VMware and Quest, raising services visibility is no easy matter, regardless of route to market.
Can acquisitions help Vodafone establish enterprise market momentum?
This week Vodafone made a recommended £1 billion cash offer for Cable & Wireless Worldwide (CWW). CWW’s sizeable fibre network with connectivity to more than 150 countries will be a relatively cheap way of handling escalating volume of 3G, and eventually 4G, data traffic. CWW’s next generation network capability, products and applications including support for contact centres, data management, infrastructure services and enterprise voice management will add to Vodafone’s enterprise capabilities. However, we have yet to see a telecommunications provider establish sustainable momentum in enterprise services. Further, public and protracted uncertainty around the acquisition does nothing to inspire confidence.
Knowledge transfer amplifies customer and partner success for DataCore
Ease of adoption is a critical but often overlooked success factor. Operational considerations are just as important in our upcoming storage hypervisors study, and regular readers will be familiar with our support profiles series. This week we had the opportunity to discuss support and services with Nick Broadbent, Vice President of Customer Services at DataCore. Our previous analysis highlighted how SANsymphony has evolved with use cases ranging from commodity arrays to highly sophisticated QOS array types, so we were keen to understand how DataCore scales its services capability to serve a widening spectrum of customers.
Dell’s storage services deserve more visibility
Dell’s progress in services is praiseworthy. It inherited multiple capabilities and cultures from the various acquisitions and has implemented a clearly defined process for maintaining its services portfolio and delivery capability. Dell’s services challenge remains in marketing from within a predominantly hardware brand. This is a common challenge faced by services business within larger non-services companies. Corporate marketing resources and roadmaps tend to be geared towards manufacturing life cycles, and must be re-aligned to handle faster-paced services development cycles.
Logicalis aligns for global growth
Logicalis had a good year, growing by 25% to earn just over $1 billion of revenue. The challenge ahead lies in reducing the gap between speed of capability change and it’s customer engagement response. Delivery professionals work with customers on a day to day basis and develop solutions to meet business needs. Marketing and sales on the other hand rely on predictable portfolio and market segment definition to allocate resources accordingly. Services companies that perform better than the market average are those that have mastered the art of taking their investment cues directly from customers, and not their technology vendor partners.
Serving aggregators helps Quest Software hone its portfolio
Quest Software supplies software tools for application management, database management, Windows management, virtualization management, and IT management across physical, virtual and cloud environments. It has focused on creating an end-to-end MSP business management solution that will provide robust remote monitoring and management (RMM) functionality together with professional services automation (PSA) capability. Quest identified fast growth customer segments, understood pressing requirements and plugged gaps in its portfolio. The company’s resource allocation approach to handle administration workload associated with customer contracts demonstrates its respect for customer preferences. We see many vendors automating this process and expecting customers to self-serve, only to discover renewal rates plunge.
Acquisitions set pace for VMware’s consulting practice
We initially explored VMware’s consulting and education services as part of our storage hypervisor study. While storage consulting is not called out separately, it is part of or the entire scope of a consulting assignment, depending on customer requirements. The company works with customer contacts across a broad spectrum, from CIOs to VP of IT and IT infrastructure to Directors, though arguably its consultants most frequently engage with the Datacenter owners or owners of IT infrastructure. VMware is also proud of its 1,600 consulting and technology partners who represent an important part of resources available to customers.
Minacs tests alliances and blended shoring for growth
Aditya Birla Minacs, more commonly know as Minacs, provides business and technology outsourcing. It is a subsidiary of the Aditya Birla Group and has headquarters in Bangalore and Ontario. The company has 20,000 employees operating from 36 centres in Canada, Germany, Hungary, India, Jamaica, Philippines, the UK and USA.Demand for IT and IT enabled business services are changing fast. In addition to pressure on enterprise IT by bring-your-own-device, mobility and cloud computing, services firms are trying to balance phasing out old conventional contracts while introducing more contemporary services. Minacs’ challenge is no different from hundreds of services companies and its experiments with alliances and blended shoring will be worth tracking.
Rimini Street’s success testifies to old gaps in the market
Rimini Street is an independent third-party maintenance and support provider for Siebel, PeopleSoft, JD Edwards, Oracle E-Business Suite, Oracle Database and SAP licensees. The Las Vegas headquartered private company was founded in 2005 by CEO Seth Ravin, and has a loyal and growing number of customers who find the guaranteed annual support fee savings of 50% compelling. In 2011, Rimini Street quadrupled sales bookings to international clients. Today, the company has offices in Australia, Brazil, Germany, Singapore and the UK in addition its US operations. Although annual revenue for 2011 was a modest $33 million, the more telling figure is its $394 million backlog.