IBM Takes Notes in the Cloud

Cloud computing and SaaS

Widening its embrace of Software-as-a-Service (SaaS), IBM today launched a hosted version of its venerable Lotus Notes enterprise messaging offering — potentially giving its customers new flexibility but also pushing IBM into greater competition with existing online groupware vendors.

Dubbed Lotus Notes Hosted Messaging, the new edition of Lotus’ flagship office application marks the continuing growth of enterprise applications available in the “cloud” — the concept of hosted software popularized by vendors like and AdventNet, with its smaller Zoho Office Suite. More recently, Google also leaped into the fray with Google Apps for businesses.

For IBM Lotus, offering Notes as a service is “a natural extension of the portfolio; we’ve seen (NASDAQ: CRM) and Google (NASDAQ: GOOG) in SaaS and the cloud and it seems to be a natural way for us to extend our business,” John Dunderdale, Lotus’ vice president of worldwide sales, told

It also may prove advantageous for IBM, since SaaS-based offerings continue growing in popularity as enterprises seek to offload the expense of installing and maintaining on-site software. Priced at “under $10” per user per month, Lotus Notes Hosted Messaging will be stored on a server at an IBM datacenter managed by a dedicated services team. It is available with two service-level agreement (SLA) options, spam- and virus-filtering, and backup and restore services.

The move also signals yet another stage in IBM’s increasingly aggressive marketing behind Notes. Last month, it enabled iPhone access to Lotus Notes.

Lotus Notes Hosted Messaging is aimed at retail, global manufacturing and insurance companies with from 1,000 to 10,000 users, but IBM (NYSE: IBM) also said it would tailor software and service plans for smaller and larger companies.

“That 1,000 to 10,000 figure is just an initial guideline,” Dunderdale said. “Once you get past a certain number of users, then strategic outsourcing may be more appropriate.”

The service “will have appeal for underserved users in large enterprises or new departments of large enterprises and small and medium-sized companies that don’t want to have the responsibility of maintaining the infrastructure or want to add users on the fly,” he added.

IBM is moving strongly into the cloud, and has a computing infrastructure in the cloud that consists of two datacenters, one in its Research Triangle Park, Raleigh, N.C., and the other in Tokyo. Big Blue also offers Sametime Unyte, a Web-based conferencing application.

It also earlier this month launched an initiative that offers a mix of on-premises and cloud computing applications to help partners offer those services to customers. IBM also opened up an early version of Bluehouse, a social networking and collaboration cloud service designed to connect people from different businesses.

It’s about the reliability

Industry watchers reacted positively to IBM’s latest SaaS move.

IBM is “offering this as a hosted service on the cloud, and they’ve got Sametime Unyte, their Web conferencing system — what they’re doing is a full-court press,” Laura DiDio, principal at analyst firm ITIC, told “You get antispam, antivirus filtering, or backup and restore, and each mailbox has a gigabyte of capacity. It’s very competitive.”

Better yet, the service has the IBM name behind it and is hosted in IBM datacenters, “so a customer sees reliability — it’s a brand you can trust,” DiDio said. “People in the small and medium business market are very risk-averse.”

However, IBM needs to be even more competitive to be successful in the small-to-midsized business market, “where Microsoft has done so well,” DiDio added.

“They might even want to do some special promotions and offer the service at $5 a pop for a limited time in selected markets,” she said.

In other Lotus-related news, IBM said that it signed Global Hyatt Corporation to a deal that will see the hotel giant standardizing on Notes, Lotus Sametime instant messaging and the Lotus Domino server. Hyatt employs about 90,000, and said it would be using the software throughout its business, according to a statement from the companies.

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