“We’re at a tipping point,” said John Mason, General Manager, Mid-Market at IBM. “Once every 20-25 year shifts in this technology industry,” while talking about the mid sized businesses and their cloud business with theCUBE co-hosts John Furrier and Dave Vellante, live at IBM Pulse 2014.
Mason said this was something once faced once or twice in a career. “We have the coming together of cloud, mobile, social, and Big Data, which is really changing everything.” For the mid-sized businesses, “what cloud lets them do is go really fast, it’s about speed and agility. Find markets to go to and grow quickly, that’s what cloud is all about.”
Commenting on their acquisition of SoftLayer, Mason said there had been an explosion in the number of companies going to SoftLayer with 2400 new customers, a real acceleration. That growth is expected to go faster “as we roll out more data centers. We are trying not to break what SoftLayer has been building,” thus they are doing what he referred to as “reverse integration, integrating IBM into SoftLayer.”
Asked how they defined mid-market, Mason said “we at IBM define mid-market by every company who’s got fewer than 1000 employees. There’s something unique about the smaller companies in terms of infrastructure.”
They typically don’t have as many layers of legacy technology or the inside expertise, according to Mason. To compensate, IBM has thousands of partners working on local markets and helping mid-sized companies to really make the most out of IBM technology and services.
“In the mid and higher end of mid-market, the challenge that many of these companies face is they spend most of their IT time just keeping the shop going,” not having enough room to test out pilots and new solutions in a timely manner, Mason said. “What we really are able to do now with the cloud technology is to speed new growth projects for these companies.”
That shifts focus to engaging forward, reaching out to their customers, partners, stakeholders with new ways of interacting.
A future world of hybrid cloud
Asked how companies in this market were organizing around the cloud and what they were doing with the systems of record, Mason said “eventually, everything is going to be a hybrid cloud solution, and every company will be a cloud provider at some point. It’s really going to be a hybrid world.”
Many of the mid-sized companies have to keep their on premise solution running. They are driving new growth with public cloud activities. These two need to be further linked, tying in the systems of record with cloud activities and the need to scale. That is where the hybrid cloud plays its part.
Commenting on IBM’s global cloud business, Mason said in 2013 the company had $4.4 billion in cloud-based revenue, of which about $1 billion was for services. Cloud is already a “significant business for IBM. Now we’re doubling down,” Mason clarified, investing $1.2 billion in infrastructure build out, along with other investments in cloud platforms. As far as the global roll-out goes, Mason said “today we have 13 data centers with SoftLayer, 12 at IBM, and we’ll take it to 40 by the end of the year.”
Asked to comment on the paradigm shift Watson brings, Mason said “what we’ve got right now, we’ve seen these waves of innovation, in part you’ve got these three elements coming together – cloud, mobile, social, that create massive amounts of data. What that data allow us to do, though, is to be much more targeted, insightful. There is no way we can process it with the technology from the past. That is where Watson comes in.”
There is a clear deliverable there, he stated. The goal is to make technology work easily to drive businesses forward.