IBM Coaxes Deals from Service Providers

IBM this week initiated deals with top performing industry partners and unleashed it server lineup designed to lure service providers and enterprise customers away from leading Internet equipment manufacturers.

Big Blue formed a partnership with Cisco Systems Inc. to implement e-business solutions across its server lineup. The move is designed to help service providers increase their opportunities to grow e-commerce revenue streams.

IBM also formed a partnership with Red Hat Inc. to deliver Linux-based solutions to ISPs. The move partners IBMs server technology with Red Hats Linux entrenched distribution routes. Ideally, IBMs Red Hat deal is designed to improve service deployment for ISPs by accelerating their speed to market with new services.

In addition to Linux or Microsoft Corp. Windows 2000-based platforms, IBMs Netfinity server line up features e-mail from Sendmail Inc., Web hosting on Apache Digital Corp. or IBM WebSphere programming, and Cistron Radius-based Internet access support. The servers also include news, chat, firewall, caching and collaboration support starting at $4,000.

Jose Garcia, IBM vice president of eSP and emerging markets, said its server line-up doesnt stop with well know freeware server solutions.

“In addition to popular baseware included on our servers, ISPs can download middleware for upgrading their IBM servers on a single fee basis,” Garcia said. “This enables ISPs to go online and quickly download software upgrades to keep their servers performing in step with the demands of the Internet.”

Not to leave UNIX-based ISPs out of its reach, IBM struck a deal with Chili!Soft Inc. to deliver robust Web hosting solutions for ISPs providing Active Server Pages over IBM-UNIX systems.

IBMs Chili!Soft deal places it within the line of sight of server industry leader Cobalt Networks Inc., which moved to acquire Chili!Soft in March.

Although IBM cant touch Cobalts market dominance of the server appliance market in the U.S., Big Blue is know around the world and has focused its efforts on hot-spots of Internet growth on a global scale.

IBMs Garcia said the server industry is a highly fragmented marketplace.

We have some work to do in the U.S.,” Garcia said, “but the market is fragmented. We may not be number one in the U.S. right now, but we have 25 percent of the server market in India, and are growing well in other burgeoning hotspots around the globe.”

IBM also introduced a Customer Relationship Management program designed to help service providers sell high-speed Internet access. Although the CRM program may help ISPs deal with growing their high-speed customer base, IBM intends to keep a human element at the core of its ISP program.

Jim Corgel, IBM Net Generation Business general manager, said its NGB division focuses on building partnerships with ISPs, application service providers and others.

“NGB brokers marriages of ISPs, ASPs, ISVs, VCs, integrators and enablement companies,” Corgel said. “Were focused on building partnership between companies from the ground up.”

Garcia added that IBM is ready to pay the price to acquire news customers as a late entrant in the server market race.

“We want to acquire new customers that weve never had before,” Garcia said. “Right now one-of-two companies buying IBM servers never bought from IBM before.”

Corgel said that IBM Net Generation is putting its people to work in tandem with its online business solutions.

“Weve se

t up IBM teams in 35 major cities worldwide to help service providers and enterprise clients make the most of our aggregated online resources,” Corgel said. “But IBMs strength has always been in its people. Were going to leverage our people skills to gain the respect of our Internet initiative worldwide.”

In this fast-paced online world of e-commerce initiatives and dot-com start-ups someone had to remember that simple human contact can make, or break a programs rollout. Its no surprise that IBM is returning to its roots in order to gain a toehold in the server market and grow mindshare among service providers worldwide.