Washouts: IBM-Sun and Opening Day

OK, so technically the talks broke down over the weekend, as these things so often seem to do, with IBM formally withdrawing its massive $7 billion buyout offer on Sunday. Still, the deal appears to be a washout on Monday (when we're writing this), just as the Sox game was. The Wall Street Journal, which broke the IBM-Sun breakdown story, followed up on its scoop by reassuring us that IBM will bravely soldier on despite this setback.

But IBM's health was never really in question. Sun is the company that has had some troubling financial news in recent years. And, oddly enough, Sun is apparently the party that walked away from the deal, with ex-CEO and current chairman, the supposedly retired Scott McNealy (he lives!), opposed to selling the company he co-founded.

McNealy's move has already drawn criticism from some quarters, with pundits comparing Sun's resistance of IBM to Yahoo's thus far not-so-successful resistance of Microsoft. The thinking there is that Sun is worth about as much now as it'll ever be worth, so now is the time to sell.

Here at RCPU, we've long respected McNealy as a technology visionary and a feisty competitor, but we do wonder whether he's a little bit too proud of his baby right now. Consolidation is normal in any industry, but we at RCPU aren't always huge fans of it when it comes to technology companies.

Sure, a buyout by a bigger firm can boost a smaller company's coffers and foster innovation. But purchases of one big vendor by another often have the opposite effect, with the buyer and the bought spending more time trying to merge operations than actually combining forces to come out with cool, new stuff.

Sun has always been an innovative company with a West Coast culture; it's not that IBM's not innovative, but Big Blue's button-down approach might not fly with folks who currently work for a pony-tailed CEO in the person of Jonathan Schwartz. Then again, as we said a couple of weeks ago, if IBM can end up being the company that saves Sun's technology, the deal might be good for the industry -- if not for Microsoft partners, who would (eventually) face a bold new competitor, especially in the cloud computing market.

Sun's financial situation is difficult, to say the least, and while we'd like to see Sun survive as an independent company, the pressure coming from Wall Street might be too much for the defiant McNealy. We suspect, as many other watchers do, that the deal might not actually be dead yet. The big question now is: With rain forecast all week for Boston, will IBM buy Sun before the Sox play their first game? Probably not, but stay tuned.

What's your take on IBM and Sun? Can Sun survive on its own? What would a merger mean for Microsoft partners? Send your thoughts to [email protected].

Posted by Lee Pender on 04/07/2009 at 1:22 PM1 comments

Windows Server 2008 Foundation Rolls Out

Posted by Lee Pender on 04/02/2009 at 1:22 PM0 comments

RCP Platinum Partner Program Profile: Dell

Yes, the former titan of direct sales turned channel champion scores well in our survey, despite some of the comments we've received about the company at RCPU over the years. Read more about Dell's successful partner play here.

Posted by Lee Pender on 04/02/2009 at 1:22 PM2 comments

Why Does Microsoft Pretend To Be Open Source-Friendly?

Not long ago, Microsoft dropped a white paper on how great a job it's doing of "actively participating in open source." You can download the white paper here, but we'll warn you that the PDF crashed your editor's Firefox browser multiple times but worked fine in Internet Explorer (seriously). That's just a word of warning. That's all we're saying. Any irony you might derive from that little revelation is purely your own and not the responsibility of RCPU.

Microsoft's history with open source is controversial at best and disastrous at worst, and it's hard to get a read on how the company really feels about non-proprietary technology. We're guessing that most folks in Redmond hate it, but regardless they clearly acknowledge its importance and want to do something about it. Some seem to want to interoperate with it and embrace it; others seem interested in patent-bashing it to death, and still others seem to see the whole thing as a standards battle. Nevertheless, open source is clearly on the radar in the Pacific Northwest.

So Microsoft is addressing open source -- perhaps in a somewhat contradictory and confounding way, but it's addressing it nonetheless. That's fair to say. But -- and this is what we've been leading up to -- the notion that Microsoft is "actively participating in open source" seems a little misleading. Oh, sure, it's a vague enough statement; there probably isn't a company in the industry that isn't "actively participating in open source" in one way or another, and given that Firefox is the official browser of RCPU, we figure we're "actively participating in open source," too. Just about everybody in the world who uses a computer probably is somehow.

So we're not calling anybody in Redmond a liar here, but we are left with the distinct impression that Microsoft is trying to make itself out to be open source-friendly, almost accepting of the model and much more a part of the open source community than it really is. Oddly enough, the whole white paper doesn't really read that way, and overall it's not a bad assessment of the Microsoft-open source relationship. But phrases like this in the introduction jump out at us:

"Microsoft's open source strategy is grounded in recognition of the value of openness to working with others -- including open source communities -- to help customers and partners succeed in today's heterogeneous 'world of choice.'"

Suitably vague, of course...and we're not impressed. Why go on the defensive, Microsoft? Why pretend to want to have anything to do with open source? Is anybody going to buy this stuff, anyway? We wish Microsoft would just say what it means and drop the niceties. Here's what we'd like to read in the introduction of Microsoft's open source white paper. Remember, this is RCPU talking, not Microsoft, but it's how we suspect most people in Redmond feel:

"Frankly, Microsoft isn't a big fan of open source because it's a competitor and, like any business, we're not so fond of competitors. And frankly, we don't want to work with open source, Google, Apple, IBM or any of our other competitors because, like any company in any industry, we want customers to buy everything they possibly can from us and then upgrade it later on, or come back and buy it again and again. But we recognize that customers don't always do that (although we honestly can't figure out why, given how great our stuff is), so we'll open ourselves up to interoperability and cooperation to the extent that customers and partners demand it, and to the extent that we're not giving away intellectual property. We'd still like to see Linux go the way of OS/2, though, and we're going to do everything in our power to make that happen."

Of course, no company would come out with a statement like that, but wouldn't it be fun (and refreshing) if one did? All we're saying here is that Microsoft is in business to make money and not to pretend to care about open source, and there's nothing wrong with that. Talking about meeting customer demands is great, but buttering up open source with lawyer-vetted copy just seems silly. All the soft-pedaling coming out of Redmond feels stilted and disingenuous, and we really don't think it's necessary. Stop pretending, Microsoft. Just be what you are. It has worked pretty well for you so far.

What's your take on Microsoft and open source? Send it to [email protected].

Posted by Lee Pender on 04/02/2009 at 1:22 PM2 comments

RCP Platinum Partner Program Profile: HP

Read more about RCP's award profile of the HP PartnerONE Program or read the entire RCP Platinum Partner Program report.

Posted by Lee Pender on 04/01/2009 at 1:22 PM0 comments

Storm Gathers as IBM, Microsoft and Others Talk Cloud Computing

A new -- or ostensibly new -- computing model is always a wonderful excuse for an old-fashioned slap-fest between mega-vendors. And so it is with cloud computing. When something called an Open Cloud Manifesto, which didn't even appear to be supported by the organization that sponsored it, appeared Monday, Microsoft immediately (and perhaps unnecessarily) slammed it.

Now, Microsoft and IBM, among other big names -- but not Amazon and Google -- are in some sort of weird negotiations about openness in the cloud or...something. (Microsoft and some other big vendors are also trying to convince the government that cloud computing is secure, but that seems to be another matter altogether -- one that's mainly driven by hunger for government cloud computing contracts.)

Manifestos, calls for standards, oddball negotiations, meetings among vendors about interoperability...we've seen all this stuff before. And it mostly means nothing. The fact remains that the market will decide how (or whether) cloud computing shakes out, whose model wins and whose goes down in flames. (Either that or one vendor will sabotage the whole market and steal all the revenues for itself, but we're not going any further with that thought.)

And when companies finally do get comfortable in the clouds and need to exchange data, the big cloud vendors -- should there be more than one left -- will find a way to make their systems work together, not out of a magnanimous sense of friendship but because their customers are chomping at the bit for a solution.

That's the technology industry. That's capitalism. That's the way we like it. "Manifesto" is a very 20th-century word to us, and not one that has often had a positive connotation. Let's leave it in the past and move on with the future -- a future of fierce competition and, hopefully, great innovation.

What's your take on where the cloud is moving? Send it to [email protected].

Posted by Lee Pender on 04/01/2009 at 1:22 PM0 comments

Windows 7 in...May?

Posted by Lee Pender on 04/01/2009 at 1:22 PM3 comments

Novell and Partners: Still Some Work To Do

"Next time you meet with Novell, find out what they plan to do about companies that use SUSE for their solutions. I see a big push for existing partners; if you look at the channel, most of the partners are service-based and rely more on partner consulting services than on new product sales. We have the only FIPS 3 identity-based encryption appliance available that utilizes a Novell solution stack, and yet since we are new to the market we can't get any help from Novell. I would be very interested to hear Novell's take on assisting new companies that bring their product to market utilizing a Novell stack. Are they only committed to companies with a customer base, or are they willing to incubate and assist companies coming to market? What kind of incubation assistance from Novell is available? SUSE is still new to them, and if Novell doesn't step up and do like Oracle, which provides incubation assistance for companies, how will Novell entice companies to risk bringing new products to market on SUSE? I'm not knocking Novell; we are just struggling to gain customer acceptance all on our own and feel our investment has been all one-sided and haven't seen support that we had hoped for."

David, you bring up a lot of good questions that we obviously can't answer, but we will say that our impression is that Novell's revamped partner strategy is very much a work in progress. And while we don't spend a lot of time writing about Novell -- RCPU is a Microsoft-focused newsletter, after all, at least in theory -- we'll bring this up next time your editor talks to his neighbors in Waltham, Mass. Or perhaps somebody from Novell will read this entry and respond. We'll see. But as with any undertaking that's really just getting started, a little patience might be in order, although we understand that you need a lot more than patience right now.

Meanwhile, Jim thinks RCP Editor in Chief Scott Bekker is all wet in his analysis of Dell's moves to bring distributors into its channel mix. Looks like Dell still has some explaining to do to get parts of the channel on board:

"I think I still have my copy of Dell Direct around here somewhere if you would like to refresh the memory banks on where they stand. OK, enough of the wet noodle slaps...

"Have you considered they also sell to Wal-Mart, Sam's Club and Staples? Is this really who we should be competing against? Last time I looked, the profit margins on these deals was 2 percent to 4 percent for resellers. Hard to pay commissions, much less make a living with those numbers. We're a small company dealing with other small (10-20 seats) companies so maybe this doesn't apply to everyone, but I have been burned by Dell in the past, and see them as nothing more than a nuisance and lower-end vendor in my area."

Have a response, a comment, a question or a rant...about anything? Send it to [email protected].

Posted by Lee Pender on 03/26/2009 at 1:22 PM1 comments

IBM-Microsoft Mainframe War Still Raging

Posted by Lee Pender on 03/25/2009 at 1:22 PM0 comments

Salesforce.com Gets to Twittering

Posted by Lee Pender on 03/25/2009 at 1:22 PM0 comments

Novell Wants a Partner on Every Deal

Your editor traveled approximately five minutes by car from his home in Waltham, Mass. to Novell's headquarters in Waltham, Mass. last week to chat with a couple of Novell channel executives. Their message was loud, clear and repeated more than once: The company wants partners in on deals -- every deal, even -- early in the sales cycle and will rely on the channel to serve customers after the sale.

Novell had announced enhancements to its channel program in February, including a deal registration program, extended training offerings, and consolidated product SKUs and a single price list, both aimed at simplifying the ordering process and holding partners' costs down.

But there's more to Novell's new partner plan than just a few tweaks. There is, to hear the company's channel executives talk about it, a renewed and very genuine commitment to partners, led in part by former Microsoft channel executive Steve Hale, now Novell's vice president for the global datacenter channel, and by 15-year Novell veteran Scott Lewis. Lewis, vice president of partner marketing and enablement for the company, said that Novell is looking for partners not just to sell and implement SUSE Linux, the company's flagship product, but also to sell and support its other offerings, as well.

"We go to market in datacenter, end-user computing, and identity and security," Lewis told RCPU. "We generally are looking for partners in one of those solutions."

Or more than one, he said, noting that expertise in multiple products is a positive. Those offerings include the PlateSpin product line, which encompasses datacenter management, server virtualization and disaster recovery, among other categories. Novell acquired the vendor for $205 million about a year ago.  

That datacenter management category is where a lot of recruitment is taking place, Lewis said: "If you look at our end-user computing, there's much more of a push to grow the partners we have. Those products have evolved in recent years. If you look at identity and security, there is a push for recruitment there, but it's not massive. If you look in the datacenter space, there's an overlapped set of needs there. That's not Novell's historic partner base. We're recruiting there."

Partner recruitment isn't just a numbers game, though. Lewis said: "When we look at partners, it is a quality not a quantity game. We're not looking to radically increase the number of partners we have."

And the company's also looking to increase the amount of revenue it derives from the channel. Partners account for more than half of the company's revenue now, according to Lewis, and Hale said that figure is increasing. It'll keep going up, too, he said, as Novell continues to reach out to the channel in more deals.

"That number continues to increase, and it's one of [our] directives to be inclusive of a partner in every opportunity we go after," Hale said, noting that the company is looking to get partners involved earlier in the sales cycle. "Ideally then you've already got the partner ingrained in the whole process."

Some of that business includes services, something Novell already provides its customers. Hale notes that the company is looking to make Novell services complementary to partners' service offerings while recognizing that many partners now make the bulk of their revenues through services.

"We want to engage with [partners] to make sure that they are as good as any of our Novell services people," Hale said. "Novell services is really there to be the expert of experts around Novell technology, and we will be there to deliver great services, but very clearly a part of the charter is to do partner enablement."

The company wants to "pair up Novell services with our partners," Hale added. "We want to encourage that kind of behavior so that our partners understand there's a market and Novell will be there to help [them]."

The company is also trying to tailor its program to different categories of partners, and if some of what Novell is doing sounds similar to Microsoft's current and forthcoming partner efforts, that's no accident: The recently appointed Hale said he has taken lessons from Microsoft into his new gig.

"What we're trying to do is get a very crisp taxonomy of the different types of partners out there," he said. "In general, there's about six or seven different profiles of partners, all the way up from ISVs to SIs."

For his part, Lewis added that Novell won't shut partners out of bigger -- or smaller -- deals. "We expect partners to play in every size account we deal with," he said.  
 
Hale and Lewis hope to bring a new channel focus to a company that has seen its share of transition over the years. Partners shouldn't lack for opportunities with the new, channel-centric Novell.

"We're starting to turn business over to partners that they wouldn't have seen before," Hale said.

What's your take on Novell's channel overtures? Send it to [email protected].

Posted by Lee Pender on 03/24/2009 at 1:22 PM0 comments

'Vista Capable' Lawsuit Fizzling

Posted by Lee Pender on 03/24/2009 at 1:22 PM1 comments