IBM Needs to Better Articulate SMB Strategy, Says Ovum Analyst


Earlier this year I wrote about IBM's ambitious plans for Lotus Foundations, a bundle of software pre-installed on servers that includes Lotus Domino, file management, directory services, firewall, backup and productivity tools. IBM is positioning it as a flagship solution for SMBs and also as its entry into software-as-a-service, since it plans to roll out a complementary set of Web-hosted services designed to facilitate enhanced collaboration through file sharing, online chat and Web meetings.


Though the Lotus Foundations Start (LFS) server, which shipped in June, has potential for the SMB market, Ovum analyst Laurent Lachal writes on IT Brief that Big Blue needs to better articulate its SMB strategy and deliver on its online service promises. (The latter is becoming an issue for many vendors, thanks to recent outages at Google, Amazon and others.)


Lachal calls LFS a "strong all-in-one server offering" for the lower end of the SMB market that makes Lotus Notes/Domino much simpler to use. In fact, writes Lachal, it could challenge both Microsoft and Google in the SMB market.


But the branding is confusing, writes Lachal, who believes the product shouldn't be sold under the Lotus name. IBM references the mid-market in a recent press release about its plans for additional Lotus Foundations servers, notes Lachal, while the product is actually better suited to smaller businesses. Lachal suggests creating separate brand names for the mid-size and small business segments.


Lachal writes:

The company has the same problem with Notes/Domino, as it has with its approach to appliances: it focuses on the product instead of on the audience. In the same August press release, it stated that "Lotus Domino is the enterprise collaboration software platform of choice for the majority of the Fortune 500 companies. Now the thousands of ISVs developing applications for Domino can easily offer their products to the small business market."


The lower end of the SMB market is a completely different beast to the Fortune 500 market, and trying to embrace them both with the same offering is a big, if rather common, mistake.