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HP, IBM - Stuck in the 'midrange' with you

Whatever that means

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Midrange? Medium? Mid-market?

A lot of this talk will sound familiar to IBM midrange shops, of course. IBM's Shearer, without knowing it, echoes a lot of the sentiments expressed by his rival over at HP. "Everybody defines mid-market differently," explains Shearer, and ironically, we can't even agree on a single word - midrange, medium, mid-market - but we still all know what we mean. "The news now is that the mid-market is the place where revolutionary new business designs are coming into play, not just the latest processor technology."

This is why IBM has merged its various server units and put together a single entity called Business Systems to peddle various IT products to the SMB space. IBM wants to get away from talking about feeds and speeds and talk about supporting business objectives and then pitching technologies based on where customers are at now and where they want to go in the future.

Like HP, IBM says that roughly speaking the SMB space is customers with 1,000 or fewer employees, but adds some qualifiers. SMB shops expect the same IT capabilities and have the same kind of business processes as larger enterprises, but they do not have deep IT skills, they have limited funding for tech support, and they cannot afford to integrate technologies themselves.

"One of the things that we learned in talking to customers is that small and medium businesses do not think of themselves as such," Shearer says. "That's why we chose the Business Systems name, because these companies just think of themselves as businesses."

The common touch

But midrange shops in particular have some common attributes.

First, according to Shearer, is that they are decidedly different, which means the company owners and the employees have made a conscious choice to work for a small or medium business; they are often family owned businesses, and if they are not, they act like families just the same. Often times, the people who own and work at the company are the company brand, and they behave as such. They are independent, and they are just as inclined to act from their instincts as they are from deep analysis.

They have a growth attitude, and they want to invest in growth; they are looking at scale and efficiency to get there. There is an interesting subset of the midrange that Shearer calls the establishment, by which he means the midrange companies that have "made it," that have found their niche and that have built the systems to support it, but who are still looking to innovate and to recapture some of their entrepreneurial past to grow. "Obviously, the IT solutions that we offer have to reflect this, which is why we have changed our sales and marketing approach to market-driven from product centric."

Like IBM did 20 years ago with the AS/400, Big Blue is looking to raise the bar on integration and ease of use for companies in the SMB space with a project it calls the Blue Business Platform. The products will pilot in the fourth quarter, including Power Systems running the i platform as well as Linux on X64 processors. The systems will come with Web 2.0-style applications and support, and will have hooks and a common framework so application software vendors can provide a consistent way to support code. Blue Business embodies a kind of hybrid computing model that mixes local and remote processing and control.

"I believe that this hybrid computing model will find its way into all markets," says Shearer. "But it will start in the midrange and then go north into enterprises and also south into small businesses. I think we will be able to achieve a level of simplicity that is orders of magnitude better than what we see out there today." ®

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