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AHEAD OF THE CURVE: Vendors make it tough for the little folks

AHEAD OF THE CURVE: Vendors make it tough for the little folks

When you see the word "express" attached to a product line or a model name, it's industry shorthand for products aimed at the SMB market.

The formula for tailoring technology for SMBs is pretty consistent: SMB software is enterprise software with a limited number of client licenses thrown into the box and little, if any, capability of scaling. SMB hardware has limits on internal expansion and external scalability, and often places a lower priority on playing well with other vendors' products. And whatever other differences may apply, support is the biggest difference between your $US4000 rack server and the other guy's $US6000 rack server.

If I run a small or midsize business, I want my systems, software, and services to keep pace. But they won't. Vendors say they will; they won't. There's a magic line that major vendors draw separating SMBs from customers they care about.

In my conversations with Dell, HP, IBM, Microsoft, Sun Microsystems and others, the SMB/enterprise line wanders from 100 seats to 1000. But as soon as you grow to 101 or 1001, you're going to get whacked. With software, your SMB-friendly rates for licenses shoot up to enterprise pricing, and a lot of what you had in your SMB bundle turns into expensive options. With systems and network gear, you learn that your equipment doesn't grow - it goes.

Every business prays for explosive growth. It's rare, but that's the only type of growth for which most SMB programs are designed. You see, vendors and providers rarely build in a step between SMB and enterprise. That's odd, considering that the main reason vendors create SMB programs is to draw customers toward their enterprise offerings. Perhaps SMB customers don't know that the step from 100 to 101 is a doozy. Go in aware of SMB program limitations.

Ask how many five-pack licenses you can buy at the express discount before you hit that magic line that makes all of your licenses more expensive. If you're looking at servers, ask what distinguishes an SMB or express configuration from one that's sold as enterprise-grade, and get details. If you standardise on SMB servers for a while and later decide to move up, will the SMB gear have limited management capabilities?

There are exceptions to the SMB tripwire tactic. Sun's low per-employee subscription pricing is, I think, a great way to make incremental growth pain-free. Nothing beats the old "buy it, own it" model. Apple Computer's OS X Server comes with every Xserve rack server, and if you choose to install it on a desktop or notebook, it's $US995 for unlimited users. Apple's centralised client and server system management facilities are optimised for larger deployments but work just as well when you grow from one machine to three. Vendors should supply more of that or bring enterprise-price capacity on-demand programs down to SMB levels. Under these programs, your servers all have more CPUs and RAM than you ordered. You turn CPUs and memory on and off when you need them, and you're billed for the upgrade, not for a new system.

Note to vendors: If you want to attract SMB buyers, allow customers to pay the same price and get the same capabilities regardless of the number of units. Implement fair pricing, and if service is a problem, make support beyond an initial period a pure-profit operation and give customers the option of buying into better plans as they grow.


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