Daily Archives: March 30, 2010

IBM-Johnson Controls Partnership Signals New Automation Wave

As Internet protocol proliferates, pervading every device that can possibly be networked, automated solutions are reaching into new realms and exploring untapped possibilities.

They’re also providing a dynamic foundation for new technology partnerships. One such partnership, which includes a smart-grid aspect, involves IBM and Johnson Controls.

The two companies are combining forces to improve the energy efficiency of office buildings and other commercial and industrial facilities. They’ll achieve that result by integrating IBM’s business-analytics software and middleware with Johnson’s building control technology. The objective is to deliver an automated system that will automatically turn off lights in unoccupied rooms or buildings, identify areas of heat loss, and shut off and turn on HVAC systems as required.

IBM and Johnson Controls worked together previously to deliver energy-efficiency solutions for the data center. As a result of those customer engagements and others, they realized more was possible.

Clay Nesler, Johnson Controls’ VP for Global Energy and Sustainability, explained how the partnership evolved:

“These capabilities have been available for a long time, but they haven’t been widely applied . . . . Both organizations are committed to open standards and Web technologies. So while this would have required a lot of engineering and R&D work several years ago, we now hope to leverage as many standards as possible,”

That’s the key: Standards are facilitating the development and delivery of automated-management solutions, including many of those applicable to the smart gird, that were too cumbersome, too unwieldy, too ocustomized (and therefore too expensive) in the past.

This is why the networked machine-to-machine (M2M) market is seen to offer so much promise, not just for IBM and Johnson Controls, but for every major information-vendor that has its eyes open and its skin in the game. Think of Intel, which can provide chips for the embedded devices; Cisco and its network infrastructure; Oracle with its analytics applications and databases; Dell with its servers; Ericsson with its wireless-networking technologies. Also consider the new business possibilities for wireless operators worldwide.

It’s a huge opportunity, and the smart grid, broadly defined, is a big piece of it. Technology vendors have a correspondingly large stake in ensuring that it is done right. Expect them to become active and involved partners with utilities, regulators, and governments.

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Dell Makes Right Move Providing Financing for SMB Customers

Dell is being more aggressive in extending financing to its SMB customers, according to an article in the Wall Street Journal.

Although I recognize the risks inherent in providing relatively generous credit terms to SMBs, many of which have suffered inordinately during the savage economic downturn and the current joyless recovery, Dell is doing the right thing, for itself and for the economy.

As the money spigots are turned tightly off by banks and other traditional sources of credit, Dell and other vendors that depend on the ongoing patronage of SMBs confront a difficult dilemma: refuse to provide vendor financing to these customers, and see them perish or go to other vendors willing to extend financial largesse; or provide them with the financing they need to buy your products and services, incurring the risk that some of them will fail anyway and not repay your loans.

The second option is better, particularly if Dell is selective in how and to whom it provides its vendor financing. In that regard, Dell, which derives about 23 percent of its revenue from SMBs (companies with fewer than 500 employees), is taking a conservative, prudent approach in assessing the credit risks of its clientele.

That’s good practice, of course. But it’s also good practice for Dell to reach out and help those customers who can be helped, and who will continue buying Dell PCs, servers, and services when times improve. The concept of enlightened self-interest in business often is viewed cynically, and there’s no question that it features a hard edge of commercial realpolitik. It can work, though, delivering benefits for all involved, and this is one example where it definitely serves more than one party’s interests.

Dell has $7 billion in credit available for small companies, and it extends most of the credit itself rather than through financial intermediaries. Good for Dell, and good for the companies and organizations that qualify for the financing.

Brocade Regional Director: Ethernet Space a “Red Ocean with Blood Everywhere”

Computer Reseller News is running an interview with Charlie Foo, Brocade’s regional director in the company’s partner business group for Asia-Pacific and Japan.

His answers are more forthcoming than one might expect. Usually, these types of interviews generate offer neither candor nor insight, and the news value is negligible. There’s nothing earthshaking in what Foo tells CRN, but he admits to a few issues Brocade is trying to correct.

As you might expect, most of the challenges relate to Brocade’s Foundry operation, which produces Ethernet switches. Foundry has been struggling, underperforming and losing ground to rival vendors. Foo uses graphic language to illustrate the dilemma:

With the acquisition of Foundry, we got into the Ethernet space. The IP market is a red ocean with blood everywhere. We’re parachuting in this ocean, not knowing where we’re going to land. But what we will do is play in the verticals we are strong in. These include education, media, entertainment, healthcare, service providers and government.

A red ocean with blood everywhere? That can’t be good. It’s worse when your Ethernet IP-switching company is the one doing the most hemorrhaging.

Foo goes on to discuss Brocade’s plans for the SMB space — I’ll withhold judgment there, though I’m among the somber skeptics — how Brocade intends to enlist and motivate Select Partners, and expounds on the company’s demand-creation plans. He also touches on a security partnership with McAfee.

At one point, while talking about the moves Cisco and HP have made to provide “converged networking” solutions for the data center, Foo contends that the 3Com-fortified HP still will not have IP-based Ethernet switching products that overlap with Brocade’s Foundry gear. That seems a hopeful assertion.

Given the challenges Brocade faces on the Ethernet switching side of the house, however, one can allow that a dose of optimism is a necessary tonic.