IBM wants more ISVs on its cloud infrastructure

IBM is luring more ISVs to develop and deploy their software on its cloud infrastructure with free beta services.

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IBM says it has added 100 independent software vendor (ISV) partners to its cloud infrastructure stable. And it is offering an open beta version of social networking services to help businesses collaborate across geographies and divisions and with partners and customers. These Bluehouse services include document sharing, contacts and collaboration, now free as a beta; IBM would not comment on the pricing of the final form.

This year's ISV additions bring IBM's total to 215, said Dave Mitchell, director of IBM cloud services.

IBM provides interested developers with white papers and expertise. In return, those ISVs must use two out of three of the following: IBM middleware, IBM hardware or IBM managed services. And they must use IBM's cloud infrastructure as their delivery mechanism. Qualified partners and customers can also get special terms from IBM Global Financing for cloud-enabled services.

IBM, like Microsoft and other tech players, is trying to populate its own cloud infrastructure with applications and services to appeal to a wide range of customers. That vendor-delivered model continues to be a source of concern among value-added resellers (VARs) and solution providers who fear the model will disintermediate them.

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The cloud, or Software as a Service (SaaS), model differs from the on-premise model in that a SaaS ISV usually selects and sticks with one application development stack, Mitchell said. ISVs in the on-premise world often field both a .NET/Windows-centric option and a Java-based option, for example.

IBM sees there is good money to be made in helping legacy ISVs make that transition to the cloud. IBM's services arm can also help end-user companies integrate cloud services into their existing on-premise systems and build their own cloud environments. And, of course, IBM is building and deploying its own cloud services.

Toward that end, the company has dribbled out announcements over the last few months as it tries to ride the cloud services wave. Last week it announced the creation of four new cloud computing services centers in Bangalore, Seoul, Hanoi and Sao Paulo, bringing its total to 13 service centers worldwide.

IBM and other tech vendors want to garner a critical mass of ISVs to offer their services on their own cloud infrastructure brands. Microsoft's Office Live effort is similar in its quest to bring applications to small businesses and consumers.

In this particular battle, both IBM and Microsoft are playing catch up. Amazon.com has won respect and business customers who are hosting Web stores on its Elastic Compute Cloud infrastructure. Google is going beyond Internet search with all sorts of Web-delivered productivity and consumer software and services. Salesforce.com and NetSuite are reaching out beyond their roots of providing hosted CRM and ERP services to providing all-around development and deployment services from their respective clouds as well.

Depending on geography and type and size of business, customers are starting to hear about cloud computing or software as a service, if only because vendor-generated hype. The big initial eye catcher is SaaS or cloud computing eliminates the need for a big upfront capital expenditure on equipment or software. That could help get hosted apps in the door of some cost-conscious companies.

"It's not that customers are asking….about [cloud computing] yet," said Patrick Williams, enterprise solution sales specialist with MSI Systems Integators, Omaha, Neb.

Still, Williams sees opportnities for the model in resource-strapped small and mid-sized companies. "When you come to an SMB, they have money but not a ton of resources. They're on older technology, RGB [monitors] and COBOL, and need to modernize. They have hiring freezes and they still definitely view IT as a cost center more than an opportunity. So there's that challenge where cloud and hosted models might come in."

Meanwhile, where there's hoopla there will be backlash. One longtime IBM ISV partner shrugged off news of that company's latest forays saying the cloud computing model has everything except real customers.

"This is the buzzword du jour. There have been different proposals to do this for at least 10 years and we're still not seeing the demand for this model. It' s more about these vendors trying to suck people into their infrastructure," he said. This Midwestern VAR said the cloud computing push is a rehashing of the application service provider (ASP) boom and bust of the late 1990s.

And Richard Stallman, GNU founder and ardent free software proponent, expressed very strong anti-cloud views that struck a chord with many. In an interview with The Guardian last week, Stallman warned that this latest cloud push was a ploy to lock users and their data into proprietary systems beyond their own control.

And, Oracle CEO Larry Ellison two weeks ago derided cloud computing as nothing more than a fashion craze. This was just days after Oracle said it would put its middleware and database on Amazon.com's cloud infrastructure.

VARs said some customers harbor abiding concerns about the very model being touted. They worry about their ability to regain their data if they opt for a SaaS software provider then change their minds. There is even worry about the vendor keeping that data hostage, one channel partner said.

IBM's Mitchell acknowledged those fears but said most businesses will go with a hybrid approach. "I don't think anyone would say, 'Tomorrow everything will move to SaaS,'" he said. "One business may feel comfortable having its human resources app delivered as a service and another may not."

Some applications may be better suited to run on on-site servers, with others sourced from the cloud. VARs will play an important role in counseling customers about what apps should run where, he said.

 

This report was updated Wednesday with additional VAR comments.

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