IBM takes pole position
By Jamsheed Gandhi
The Indian server market is dominated by the X86 category. Over the last couple of years the server market has witnessed a volume growth of around 20 percent CAGR mostly on the back of SMB demand.
For years, SMBs preferred PC servers because cost proved to be a major hindrance in deploying proper X86 servers. However, over the last couple of years, the growing SMB demand has resulted in the commoditization of servers. X86 servers with 1P are today available for as little as Rs 50,000 from all vendors. They also come with tools that make their deployment and management simpler for SMBs which don’t necessarily have access to IT skills.
Vendors too have become aggressive in their server initiatives and are offering vertical-specific bundled solutions—storage, server and industry-specific business applications to further boost IT adoption by SMBs.
Customer financing schemes from vendors are also proving a major enabler for IT investments.
Channels contend that the next phase of growth will come from Class B and C cities as broadband access improves and more companies adopt IT business applications to grow their business.
SMB customers in large cities who have deployed business applications are now branching out further and looking at consolidating their IT infrastructure to improve efficiency and consolidate costs. These companies are likely to invest in 2P and 4P servers as they embark on server consolidation.
Channel relationship
On the enterprise side of the business, channels regard channel friendliness as the most important criterion in rating a vendor. This is where IBM scored substantially more than HP. Many partners rated IBM better on channel management. The general sentiment within channels is that IBM is much more focused on its server business because it has a limited product portfolio, while HP is unable to do justice to channels due to its wider portfolio. In the case of HP, channels have to deal with different channel managers for various product lines such as printers and servers.
Many channel partners also felt that HP favored large and exclusive over smaller partners, and offered preferential treatment to them, often hurting the interests of smaller partners when it came to lead distribution and providing competitive contract rates. HP also has more authorized business partners than IBM, resulting in more competition within the brand and thus creating a certain amount of discontent among channels.
Despite this criticism, HP got due credit for its channel communication system, which was rated better than IBM’s. HP is more frequent in sending communication about products, pricing and new initiatives, and also has more partner initiatives.
As for Sun, it polled limited votes on these criteria. But those who voted for the brand suggested that Sun has the right intent but lacks resources to implement its pre-sales and post-sales support policies.
Service and support
We polled respondents not only for post-sales warranty support but also on other support parameters like pre-sales and lead generation that are critical to selling to enterprises, small or big. On warranty support, IBM scored ahead of HP, followed by Sun. Respondents feel that HP’s warranty process is too system-driven and cumbersome, and often complicated for customers and channels alike. Also, in certain cities, mainly in the west and east, respondents voted HP’s warranty turnaround to be slower than IBM’s. For instance, in Gujarat, HP doesn’t have a local spares store, which results in delays in reaching replacement parts to channels.
On the pre-sales front, IBM provides better support to its partners, primarily when it comes to setting up PoCs and also providing competitive pricing. Several partners told us that IBM often betters bids by HP for even small deals. Sun was ranked higher in lead generation.
Price-performance
IBM scored slightly higher than HP on this parameter, thanks to its aggressive pricing strategy over the last one year. A majority of respondents said that, although IBM has fewer SKUs than HP in the X86 category, its aggressive pricing is helping it win customers and deals.
Many even suggested that the lesser the number of server models the easier it is for partners to pitch and sell to customers. In terms of profitability, IBM again polled to provide better margins on single unit sales as well as multi-unit deals. In terms of performance, both brands got similar votes. Respondents also said that IBM is more aggressive than HP on the MOQ business.
Sun has become more focused on its server business, but at the entry-level its focus till now has been on AMD systems which have limited pull in the market.
Marketing and branding
In terms of brand pull, HP polled ahead of IBM because it has a larger pool of products to sell in the enterprise segment and thus far more opportunities to associate with a customer. IBM’s brand pull comes from the fact that it has ruled the enterprise space for a long time.
HP scored much higher on other marketing parameters like aggressive advertising and better MDF policies for authorized partners. In short, HP is a more visible brand than its peers.
Training and certification
Training and certification cover various aspects like regular sales and technical training conducted by vendors, and the comprehensiveness of their certification training. HP is the best among the three when it came to training. HP has more technical and sales training sessions for employees of channel partners. Its pre-sales certification program has also drawn appreciation from respondents because it has helped in improving their pre-sales, an essential in closing deals in enterprise business.
Conclusion
IBM has been polled the leader in the server category, followed by HP and Sun. What works in favor of IBM is its limited portfolio which helps bring more focus. IBM also has single-point channel management, an aspect partners believe is very important in large deals where decision-making needs to be quicker. For HP, ironically, its product breadth has emerged as the main cause of its lack of channel responsiveness.
Sun, with its limited focus on verticals like education, government and defense, has the right amount of aggression and intent. What it probably lacks is enough resources on the ground to engage more closely with channels.
Intro
l Microprocessors l Hard Disk Drive l Flat Panel Display l Optical Disk Drives l Desktop l Anti-virus l Notebook l Inkjet Printers l Laser Printer l Networking l Enterprise Storage l Enterprise Security |