Zerowait Corporation

The first day of the show at EMC world was really great. Our trade show booth was busy the whole time, and there were a lot of folks that really were happy to see us there. We saw quite a few of our customers from business and government. There were a lot of surprised looks and comments from folks who wanted to know what Zerowait was doing at the EMC show. But once we explained why we were there it made sense. NetApp legacy equipment support makes sense to a lot of customers with mixed EMC and NetApp environments.

I was really surprised by how many of the attendees were from overseas, this is really a great show.

Next week Zerowait will be exhibiting at EMC World in Orlando at booth 149. It is going to be a great trade show and we are looking forward to seeing many of our customers and friends there. Even in the tough economic environment we are experiencing the EMC show is drawing a lot of customers. This should not be that surprising since it is really one of the only targeted events for folks in the big storage business.

We hope to see you at the show.

Many years ago NetApp purchased their disk arrays from a company called Eurologic. These arrays known as the NetApp FC7, FC8 and FC9 were quite reliable and Eurologic was working on a new set of arrays when Xyratex came out with a variant of their RS1600 with 14 disks for NetApp. These disk arrays known to NetApp customers as the DS14 have been quite reliable and Xyratex has been selling quite a few of them.

NetApp has been looking to cut costs though and Dot Hill came in with a product that is significantly cheaper than the DS14 variants. According to Dot Hill:.

Pursuant to our Development and OEM Supply Agreement with NetApp, we are designing and developing general purpose disk arrays for a variety of products to be sold under private label by NetApp. We began shipping products to NetApp under the agreement for general availability in the third quarter of 2007, and net revenue from NetApp increased significantly during 2008.

In this tough market NetApp is going to have to find significant ways to cut its costs on hardware sales. I have heard rumors of a significant scaling back of NetApp Sales Engineers in the field. This will be a pity, since NetApp has some of the finest field engineers in the industry. In my opinion, if they cut back on their service and support there is not much to differentiate NetApp from every other hardware company. This may cause NetApp sales to erode further over time.

If NetApp sales are down, that would mean that Xyratex sales are down, and if Dot Hill is the new low cost vendor to NetApp it would be a double hit to Xyratex gross revenue numbers. The Xyratex folks were a loyal vendor to NetApp, I hope things turn out well for them over time.

I’ll bet someone is pitching a cheaper array to NetApp to take Dot Hill’s place currently.

Many times a day we get to laugh with our customers over something that happens or an interesting turn of a phrase in a piece of marketing material or in press release. Sometimes people send us an email with a funny turn of a phrase and today we got a good one.

“We have received a support renewal quotation from NetApp at post-warranty rates and fell off our chairs. (Have you heard this story before?) “

NetApp builds great products, and they are very reliable. But NetApp is a box selling company and not a service and support company. Therefore, NetApp needs to keep renewal support quotes high to incentivize customers to purchase new equipment. There is nothing wrong with that business model, and over the years it has worked very well for NetApp and most of their customers. But there are customers who value longevity in high availability product support, and that is where Zerowait shines. If NetApp customers are happy with their equipment and don’t want to buy the latest model, we provide them with legacy service and support at a very reasonable price point.

It is a really simple value proposition for most folks to understand…. if you are happy with what the equipment you have, we will provide you support at a price that will keep you happy. Even in today’s budget constrained situations we can help you stay seated on your chairs.

Over the last few months our business has been holding up well, we have seen an uptick in business over the same quarter last year and we have picked up quite a number of new customers. Many of the new customers have known about us for years, but when times were flush they did not need to cut back maintenance costs. But the economic winds have shifted and while many people are busy pointing fingers and assigning blame we are concentrating on helping our customers get through the rough patch. Zerowait is a service business and the longer we keep our customers happy, the better our business will be. Most of our new business is still gained by word of mouth referrals, which means that we must be doing things right by our customers.

As a service business we are concentrating on the long term, and not the unit sales going out the shipping dock’s door. By using our service and support our customers can concentrate on their long term issues, because they know that we will keep their Filers running reliability for them for the foreseeable future.

Today’s news…

WASHINGTON (AP) — The economy shrank at a worse-than-expected 6.1 percent pace at the start of this year as sharp cutbacks by businesses and the biggest drop in U.S. exports in 40 years overwhelmed a rebound in consumer spending.

The Commerce Department’s report, released Wednesday, dashed hopes that the recession’s grip on the country loosened in the first quarter. Economists surveyed by Thomson Reuters expected a 5 percent annualized decline.

Instead, the economy ended up performing nearly as bad as it had in the final three months of last year when it logged the worst slide in a quarter-century, contracting at a 6.3 percent pace. Nervous consumers played a prominent role in that dismal showing as they ratcheted back spending in the face of rising unemployment, falling home values and shrinking nest eggs.

April 26 (Bloomberg) — The U.S. economy will continue to contract “for some time to come,” said Lawrence Summers, director of the White House National Economic Council.

“I expect the economy will continue to decline,” with “sharp declines in employment for quite some time this year,” Summers said today on “Fox News Sunday.”

What is your D/R plan when part of your business critical data is in the cloud and the fiber lines are cut?

How do you make a smooth landing and keep your critical business data running if you don’t have access to your cloud resources? How do you make a D/R plan for data assets which are physically not in your hands?

Here is an article that is worth reading completely…

“Just after midnight on Thursday, April 9, unidentified attackers climbed down four manholes serving the Northern California city of Morgan Hill and cut eight fiber cables in what appears to have been an organized attack on the electronic infrastructure of an American city. Its implications, though startling, have gone almost un-reported.

That attack demonstrated a severe fault in American infrastructure: its centralization. The city of Morgan Hill and parts of three counties lost 911 service, cellular mobile telephone communications, land-line telephone, DSL internet and private networks, central station fire and burglar alarms, ATMs, credit card terminals, and monitoring of critical utilities. In addition, resources that should not have failed, like the local hospital’s internal computer network, proved to be dependent on external resources, leaving the hospital with a “paper system” for the day.

Commerce was disrupted in a 100-mile swath around the community, from San Jose to Gilroy and Monterey. Cash was king for the day as ATMs and credit card systems were down, and many found they didn’t have sufficient cash on hand. Services employees dependent on communication were sent home. The many businesses providing just-in-time operations to agriculture could not communicate.”

Imagine if your business critical data was housed in a data center that was no longer accessible, not just for a couple of hours, but for a significant amount of time. How would you make a D/R plan to recover the data that was housed remotely? How much time and effort will it take to build new servers and storage and migrate the data to another location. These are the types of questions I will bring up as a panelist during tomorrow’ s Cloudslam 09 virtual conference at 2PM.

The last lines of the article make a good point, how will enterprises recover their data assets if there is a wholesale migration to the “Cloud providers” for housing critical business data, but there is no connectivity?

“Will there be another Morgan Hill? Definitely. And the next time it might happen to a denser community that won’t be so astonishingly able to sustain the trouble using its two-way radios and hams. The next time, it might be connected with some other event, be it crime or terrorism. Company and government officers take notice: the only way you’ll fare well is if you start planning now.”

Over the next few weeks the Zerowait folks are going to be at some trade shows and also I will be featured on a panel on cloud computing. The events start this week on Friday with Cloudslam09 the virtual conference on cloud computing. If you want to learn more about cloud computing sign up for Cloudslam09.

Next we will be doing a small government show in the DC area at NRL on May 14th, and the following week we will be at the EMC World Conference in Orlando May 18th – 21.

A lot of customers can’t go to trade shows this year because of budget constraints, which has caused the Zerowait staff to travel more than we normally do. Business has to go on, and savvy businesses are embracing our high availability services to maintain their legacy equipment for longer periods than in the past. The upgrade cycle pushed by their storage vendor is often cost prohibitive and for today’s budget minded enterprises. Vendor’s with punitive support pricing models are causing customers to review their strategic storage purchases, and our company is there to help customers maintain their service levels while they review their future storage purchases.

It is going to be a busy few weeks.

Oracle buys Sun, this is a brilliant tactical and strategic business move by Oracle and they should be commended for it.

NEW YORK – Information technology company Oracle Corp. said Monday it is buying Sun Microsystems Inc. in a cash deal the company valued at $7.4 billion after IBM abandoned its bid to buy the networking equipment maker.

For the storage business it will be an interesting few years as HP and Oracle have a partnership and Oracle runs on EMC, Hitachi, IBM and NetApp. But Oracle has been able to solve these contradictions in its business before and they continue to grow. Strategically, it would seem that Oracle will have to marginalize its hardware partners over the next few years to rationalize the purchase of SUN. I expect to see them do it.

This may be a precursor to other OS and DB companies buying major hardware manufacturers. Creating proprietary hardware and software solutions is the best way to lock clients into your solution long term. In tough economic times I expect we will see more companies try to lock in their customers this way.

Update
“Right now, it looks like Oracle is going to stay in the hardware game, meaning they’re going to be competing with their biggest partners,” said Brian Babineau, senior analyst at Milford, Mass.-based Enterprise Strategy Group (ESG). “EMC and NetApp are going to have to work even harder to convince customers that an integrated application stack isn’t the way to go.”

IT budgets are under pressure and shrinking in many companies, but according to Computerworld one company is focusing on the price of coffee cups their IT department uses.

Companies are also looking beyond technology and personnel to cut IT costs. For example, Herbalife is saving $70,000 annually just by eliminating the purchase of Styrofoam coffee cups for IT workers, said Hansen.

These guys must be drinking a tremendous amount of coffee, and I wonder how many folks are in the IT department.

Uline sells coffee cups for $41.00 for 1000 12 oz cups. I calculated this out and if the $70,000 figure is true …. $70,000.00 / $41.00 = 1707.317 packages of 1000 cups (1,707,317 cups) with 250 working days a year 6829 cups a day… That is a lot of coffee and must be a huge staff. Imagine what they are paying for the coffee itself!

I don’t know how much storage and infrastructure these folks manage, but they must have excellent coffee and one great plumbing system. How do they get any work done?

“Stop buying storage. You heard me right: Stop buying storage,” Salem said. “How? Reduce the amount of information that you store in the first place, and make the storage you do have more flexible and efficient.”

I read this and thought “Wow – here is a guy that may actually understand the value of maintenance and storage management. “

Other things mentioned in article:

If you want to stop buying storage, Salem said, there are four key opportunities that everyone should be looking at right now: storage resource management, thin provisioning, data deduplication and intelligent archiving.

“If you’re like most companies,” Salem said, “you have a lot of ‘orphan storage.’ It’s time to give your orphan storage a loving family. You often have more room to grow than you realize.”

“Most enterprise data centers utilize only about 15 to 35 percent of the entire storage capacity available. The remainder is used for unexpected overhead, locked out of accessibility, intentionally kept for some other purpose or simply lost track of over time.”

All of it requires spinning disks and electricity from the grid that costs money on the bottom line, whether or not the storage is in service.

“We had one customer who told us that they were managing massive information growth. They estimated they were using 50 percent of their storage. We showed them they were only using 20 percent,” Salem said.

“What you need are storage management solutions that work across different platforms and give you an end-to-end view of the storage you have, the storage you’re using and the storage you’re not.

Storage efficiency is a concept that is often lost in the marketplace of ideas because so many people and experts define efficiency in so many varied ways. It is not just electricity usage, maintenance, square footage, information density or response time that defines storage efficiency it is all of them and viewed from different perspectives depending on the application using the storage resource.

If one solution fit all situations we would be all driving the same cars and all our houses would look the same. And there would be no innovation at all. When things get hard, it is a good time to look at your storage infrastructure and rediscover the inefficiencies, and concentrate on solving those bottlenecks. Actually, now is a good time to review all of your infrastructure costs.

By the way, I hope you can join us at EMCworld this year in Orlando May 18 – 21.