Event details

Disrupting the market of SMB servers

von Ignacio Correas (eBox Technologies)

Wednesday, 09.06.2010, Berlin I, 17:30-18:00 Uhr

Small and medium businesses comprise the vast majority of businesses worldwide and their importance in the market is just growing. Oddly enough, most IT vendors focus solely on developing solutions either for large customers or for the mass market, consigning SMBs to oblivion even though they generate more than half of the world's GDP.

They are not an easy market however, with fragmented segments, fairly complex needs, small budgets, limited availability of resources and, too often, lack of a dedicated IT department. The core of the IT in an SMB is the server that provides all the network services such as the management of the LAN, security, users and resource sharing. The leader in the market of SMB servers is Microsoft with Windows Small Business Server, a derived version of Windows Server. Nevertheless, the strategy that Microsoft is carrying out with this product is opening a great opportunity to disrupt the market. Indeed, the market of SMB servers fulfills all the conditions for the entrance of a new disruptive technology:

* The market has a clear leader * With a mature product (Windows Small Business Server) * Over-provisioned product, providing more functionality than needed and overwhelming end users by the plethora of features * Established on a continuous, evolutionary innovation cycle * With little or no commercial interest in the lower segments of the market (SBS has no product or pricing segmentation for customers under 75 employees) * With a strong motivation in abandoning the less profitable customers and focus in the more profitable ones (rising the license price by 80% is forcing customers in the low-end to look for alternatives)

Linux, combined with other open source tools for network management (Samba, Postfix, Squid, Snort, eGroupware, Spamassasin, ClamAV, etc) have a huge disruptive potential in the SMB server market, as they bring a great advantage in pricing (in fact, they are free). Besides, similarly to other disruptive technologies, they started offering a lower level of functionality than their closed source alternatives, but they have evolved and caught up or even surpassed them in many markets (close to 90% of the supercomputers in the world are based on Linux, which is a good indicator of the quality level this technology has reached).

However, in spite of these conditions, open source solutions have a very low presence in the market of SMB servers. The reason is simple: for a server solution to enter the SMBs, it needs all its components to be tightly integrated and be easy to administrate. SMBs do not have resources nor time to deploy complex high-performance solutions, so highly integrated products such as Microsoft's SBS cover pretty well SMBs’ technological needs.

This paper will analyze in detail the market opportunity for Linux to disrupt the SMB server market and push Microsoft to other segments. The theoretical analysis will be completed with the practical approach of a success story, describing how an open source product, eBox Platform, is managing to compete with the market leader and bring Linux closer to 99% of business in the world. The conclusions and methodology are expected to be useful in other markets and with other Linux-based technologies

Über den Autor Ignacio Correas:

Entrepreneurial spirit with an open view on new tendencies in technology, business development and social interactions. Ignacio is CEO and founder of eBox Technologies, developing and commercializing eBox Platform, the open source alternative to Windows Small Business Server. Ignacio is also an active member of the Spanish open source business community, being an advisor for CENATIC (Spain's National Reference Centre for Open Source) and a member of the board of ASOLIF (Association of Open Source Spanish Businesses), among others.

He has previously worked as CEO and co-founder of Warp Networks and as assistant professor at University of Zaragoza. His professional background has evolved from technical fields and management to business development. He is interested in open source development and business models, strategic development, viral marketing, e-learning methodologies and services.