Tue, May
3 New Articles

IBM and Hewlett-Packard Court SMB Market

Analysis of News Events
  • Smaller Small Medium Big Bigger
  • Default Helvetica Segoe Georgia Times

Over the last several weeks, IBM and Hewlett-Packard have taken significant steps to target small and midsize businesses (SMBs) with solutions that are tailored to their needs. While the two vendors' announcements demonstrated their growing investments in this market, they also indicated that the competition between the IT behemoths is heating up.

The latest round of announcements began on October 26 when IBM hosted a party to celebrate the two-year anniversary of its Express line of products. At the event, the company launched a new advertising campaign, known as Express On Demand Business, which targets SMB firms with the message that they need to become On Demand enterprises. As part of the campaign, IBM released a flock of print and television ads and officially opened a slick multimedia Web site for the Express portfolio.

While there was plenty of style to Big Blue's gala, there was substance as well. During the event, the company unveiled three new Express solutions. IBM Integrated Platform Express for Web Application Serving is an offering for hosting dynamic Web sites that includes an eServer pSeries system and WebSphere Application Server Express. IBM Workplace Services Express delivers collaboration software in a portal-based environment for Intel server users. Finally, IBM Process Integration Solution Express (PISE) provides a solution for integrating applications and internal business processes on eServer i5 and xSeries servers.

Given its availability on the eServer i5, many iSeries users will take great interest in the new PISE offering. In a real sense, PISE represents a new, more sophisticated crop of Express solutions that integrates hardware, software, services, and even financing into a complete package. The solution includes the iSeries customer's choice of an eServer i5 Model 520 or 570; Intel users get the xSeries Model 226. The server arrives at your door with a copy of WebSphere Business Integration Server Express. The offering contains middleware for business process modeling and redesign, including WebSphere MQ Express, that enables integration between disparate applications.

In addition, PISE comes packaged with an IBM Business Partner or IBM Global Services team that installs the software and provides an initial round of application integration assistance. IBM estimates that the typical deployment will consume 320 to 500 hours of services at an average cost of about $35,000. It also estimates an average hardware cost of $12,000 and an average software cost of $30,000. However, customers can finance the entire package through IBM Global Finance and make monthly payments as low as $2,259.

While IBM used its October 26 event to focus on its own products, it has not forgotten the solutions of its Business Partners. The company is continuing an ambitious campaign to recruit software vendors and systems integrators who can package and market IBM technologies with their own SMB solutions. Two days after the event, for instance, IBM and Integrated Distribution Solutions announced an expanded alliance under which the vendors will develop Linux-based versions of its applications for the food and consumer goods distribution industries. The resulting software will run across Big Blue's iSeries, pSeries, and xSeries servers. IBM is also working behind the scenes to broker distribution agreements between software vendors and regional integrator firms that deploy solutions in SMB firms.

Partnering the HP Way

One day after IBM's Express gala, Hewlett-Packard threw its hat into the ring with a new offering for SMB firms. The systems vendor joined with SAP America to announce a managed service that provides HP-hosted instances of the mySAP All-in-One suite to SMB firms. The service also includes third-party software for companies in the oil and gas, consumer products, high-technology device, and technical service provider industries. Hewlett-Packard will host the new services at a monthly cost that starts at $325 per user.

The new managed services are part of a wider set of initiatives that HP launched about a year ago to target the SMB market. The vendor's chief initiative is Smart Office, a campaign under which HP goes to market with selected software vendors and local solution providers. Hewlett-Packard is using Smart Office to partner not only with SAP, but also with Microsoft and Intuit. Each of these vendors works with HP to develop packaged offerings that are delivered through their networks of regional integrators and resellers.

To a degree, IBM's Express and HP's Smart Office put the two vendors at competitive odds with each other. After all, both programs focus on building ecosystems of SMB partners who commit to IBM or HP products. However, there are differences between the programs that could lead many solution providers to participate in both of them. While Smart Office includes business software from SAP and Intuit, it primarily markets infrastructure products such as HP's printers, Intel-based servers, and entry-level storage arrays. While IBM's Express family includes infrastructure products, it focuses heavily on solutions that integrate middleware and industry-specific applications. To put it another way, the Express portfolio has a much greater emphasis on back-office systems than Smart Office does. Smart Office, however, promotes front-office products that are highly popular, particularly among smaller companies where HP has more market share than IBM.

Of course, Express and Smart Office are just two campaigns within the broader SMB strategies of the two systems vendors. For almost three decades, IBM and HP have fought over the SMB market via a plethora of programs. During the 1990s, HP had a strong ecosystem of SMB partners that enabled it to compete very effectively with Big Blue. Then the company decided to phase out its HP 3000 minicomputer, put its UNIX server customers through a difficult transition to Intel's Itanium processor, and spend more than a year assimilating Compaq. When HP finally refocused on the SMB market in 2003, it discovered that many of its channel partners--especially those that provide industry solutions--were giving a growing share of their business to IBM.

This is a loss that HP may be able to recoup someday, but I doubt that the day will come soon. IBM has done an admirable job of pumping up its SMB partner ecosystem over the last two years, and that has gained it significant mindshare and momentum among mid-sized businesses. That is good news for iSeries customers, as such businesses are the sweet spot for their server of choice. That fact has not been lost on Mike Borman, IBM's new General Manager for the iSeries, who is spearheading a drive to get more business software vendors to commit to the iSeries. I will have more to say about that effort in a future article, so stay tuned.

Lee Kroon is a Senior Industry Analyst for Andrews Consulting Group, a firm that helps mid-sized companies manage business transformation through technology. You can reach him at This email address is being protected from spambots. You need JavaScript enabled to view it..

Lee Kroon is a Senior Industry Analyst for Andrews Consulting Group, a firm that helps mid-sized companies manage business transformation through technology.


Support MC Press Online

$0.00 Raised:

Book Reviews

Resource Center

  • SB Profound WC 5536 Have you been wondering about Node.js? Our free Node.js Webinar Series takes you from total beginner to creating a fully-functional IBM i Node.js business application. You can find Part 1 here. In Part 2 of our free Node.js Webinar Series, Brian May teaches you the different tooling options available for writing code, debugging, and using Git for version control. Brian will briefly discuss the different tools available, and demonstrate his preferred setup for Node development on IBM i or any platform. Attend this webinar to learn:

  • SB Profound WP 5539More than ever, there is a demand for IT to deliver innovation. Your IBM i has been an essential part of your business operations for years. However, your organization may struggle to maintain the current system and implement new projects. The thousands of customers we've worked with and surveyed state that expectations regarding the digital footprint and vision of the company are not aligned with the current IT environment.

  • SB HelpSystems ROBOT Generic IBM announced the E1080 servers using the latest Power10 processor in September 2021. The most powerful processor from IBM to date, Power10 is designed to handle the demands of doing business in today’s high-tech atmosphere, including running cloud applications, supporting big data, and managing AI workloads. But what does Power10 mean for your data center? In this recorded webinar, IBMers Dan Sundt and Dylan Boday join IBM Power Champion Tom Huntington for a discussion on why Power10 technology is the right strategic investment if you run IBM i, AIX, or Linux. In this action-packed hour, Tom will share trends from the IBM i and AIX user communities while Dan and Dylan dive into the tech specs for key hardware, including:

  • Magic MarkTRY the one package that solves all your document design and printing challenges on all your platforms. Produce bar code labels, electronic forms, ad hoc reports, and RFID tags – without programming! MarkMagic is the only document design and print solution that combines report writing, WYSIWYG label and forms design, and conditional printing in one integrated product. Make sure your data survives when catastrophe hits. Request your trial now!  Request Now.

  • SB HelpSystems ROBOT GenericForms of ransomware has been around for over 30 years, and with more and more organizations suffering attacks each year, it continues to endure. What has made ransomware such a durable threat and what is the best way to combat it? In order to prevent ransomware, organizations must first understand how it works.

  • SB HelpSystems ROBOT GenericIT security is a top priority for businesses around the world, but most IBM i pros don’t know where to begin—and most cybersecurity experts don’t know IBM i. In this session, Robin Tatam explores the business impact of lax IBM i security, the top vulnerabilities putting IBM i at risk, and the steps you can take to protect your organization. If you’re looking to avoid unexpected downtime or corrupted data, you don’t want to miss this session.

  • SB HelpSystems ROBOT GenericCan you trust all of your users all of the time? A typical end user receives 16 malicious emails each month, but only 17 percent of these phishing campaigns are reported to IT. Once an attack is underway, most organizations won’t discover the breach until six months later. A staggering amount of damage can occur in that time. Despite these risks, 93 percent of organizations are leaving their IBM i systems vulnerable to cybercrime. In this on-demand webinar, IBM i security experts Robin Tatam and Sandi Moore will reveal:

  • FORTRA Disaster protection is vital to every business. Yet, it often consists of patched together procedures that are prone to error. From automatic backups to data encryption to media management, Robot automates the routine (yet often complex) tasks of iSeries backup and recovery, saving you time and money and making the process safer and more reliable. Automate your backups with the Robot Backup and Recovery Solution. Key features include:

  • FORTRAManaging messages on your IBM i can be more than a full-time job if you have to do it manually. Messages need a response and resources must be monitored—often over multiple systems and across platforms. How can you be sure you won’t miss important system events? Automate your message center with the Robot Message Management Solution. Key features include:

  • FORTRAThe thought of printing, distributing, and storing iSeries reports manually may reduce you to tears. Paper and labor costs associated with report generation can spiral out of control. Mountains of paper threaten to swamp your files. Robot automates report bursting, distribution, bundling, and archiving, and offers secure, selective online report viewing. Manage your reports with the Robot Report Management Solution. Key features include:

  • FORTRAFor over 30 years, Robot has been a leader in systems management for IBM i. With batch job creation and scheduling at its core, the Robot Job Scheduling Solution reduces the opportunity for human error and helps you maintain service levels, automating even the biggest, most complex runbooks. Manage your job schedule with the Robot Job Scheduling Solution. Key features include:

  • LANSA Business users want new applications now. Market and regulatory pressures require faster application updates and delivery into production. Your IBM i developers may be approaching retirement, and you see no sure way to fill their positions with experienced developers. In addition, you may be caught between maintaining your existing applications and the uncertainty of moving to something new.

  • LANSAWhen it comes to creating your business applications, there are hundreds of coding platforms and programming languages to choose from. These options range from very complex traditional programming languages to Low-Code platforms where sometimes no traditional coding experience is needed. Download our whitepaper, The Power of Writing Code in a Low-Code Solution, and:

  • LANSASupply Chain is becoming increasingly complex and unpredictable. From raw materials for manufacturing to food supply chains, the journey from source to production to delivery to consumers is marred with inefficiencies, manual processes, shortages, recalls, counterfeits, and scandals. In this webinar, we discuss how:

  • The MC Resource Centers bring you the widest selection of white papers, trial software, and on-demand webcasts for you to choose from. >> Review the list of White Papers, Trial Software or On-Demand Webcast at the MC Press Resource Center. >> Add the items to yru Cart and complet he checkout process and submit

  • Profound Logic Have you been wondering about Node.js? Our free Node.js Webinar Series takes you from total beginner to creating a fully-functional IBM i Node.js business application.

  • SB Profound WC 5536Join us for this hour-long webcast that will explore:

  • Fortra IT managers hoping to find new IBM i talent are discovering that the pool of experienced RPG programmers and operators or administrators with intimate knowledge of the operating system and the applications that run on it is small. This begs the question: How will you manage the platform that supports such a big part of your business? This guide offers strategies and software suggestions to help you plan IT staffing and resources and smooth the transition after your AS/400 talent retires. Read on to learn: