Zerowait Corporation

Tom Mendoza is highlighted in the Wall Street Journal today in a very good piece. I met Tom twice at two succeeding NetApp Reseller conferences, the first time was in the Hayes conference center in San Jose and the second time was at a hotel in San Francisco. In those days NetApp liked that Zerowait was a service oriented company that had many high availability clients to whom we could offer their products.

As a highly regarded, trusted NetApp team member Zerowait received one of the first of the registered Service Provider (RSP) agreements from them. NetApp’s RSP agreement allowed Zerowait to provide first level service to some of our customers including Computer Science Corporation (CSC). What happened next was interesting. In the succeeding years, as Tom built his sales force, he saw that as Zerowait’s sales increased throughout our high availability market sector, we came into conflict with his internal sales teams. A common theme began to play out. Having done the missionary sales work to get NetApp into the bigger High Availability accounts, NetApp began to take those accounts direct from Zerowait.

By then, CSC and Zerowait had developed a long-term relationship and we placed filers with them here in Newark, Delaware right down the road from us. We were deep into a huge project, that would involve a sale of several of the latest model filers, when suddenly we learned that NetApp had made CSC a Global Partner (with discounts greater than ours). We voiced our displeasure because, we pointed out, as a result of this we lost not only CSC, but also our long-time customer DuPont, who was closely aligned with CSC for storage. NetApp just said, Business is business, sorry. Within only a short time after that, a NetApp functionary named Bruno Pakey took the lead on cancelling our reseller agreements with NetApp.

Ironically perhaps, this is the proximate cause of how Zerowait became the leader in independent support for NetApp equipment. Our customers were used to our high availability focus and our concentration on customer service. They came back to Zerowait and asked us to take over their hardware support after their contracts with NetApp support had expired. And each year since then our service and support business has grown because we provide excellent service and support for NetApp equipment at an affordable price point.

As the founder and president of Zerowait I agree with what Tom has to say about being passionate about your choices.

Q: What advice do you like to give to students about choosing a career?

A: Find something that you are passionate about, find a company that you respect and is growing in that area, and focus on making a contribution to them.

I can assure you that everyone within our company really loves NetApp products and their reliability, and that is why we help our customers maintain their NetApp Filers for many many years at affordable prices, so they can invest their precious budgetary resources in other parts of their companies.

NetApp builds great products and for almost ten years Zerowait has provided honest and affordable service and support for our customers with filers.

As an interesting side note, I never realized that Thomas Mendoza was from Commack, Long Island. I wonder if he attended any of the schools my father built while he was business manager of the Commack school district.

Over the years Zerowait has had many customer conferences at different locations around the country. For a few years we had our conferences in Key west every May, and these conferences were a big hit. This year we are having our customer conference in Reno, Nevada during the Reno Air Races. I have been attending the races for the last few years with a growing group of customers and this year we decided to formalize the event as our customer conference.

Jon Toigo has agreed to be a speaker at our Friday night dinner September, 12 2008 and will cover the issues he sees surrounding out of control data storage and data center costs. We are looking forward to a lively and enjoyable discussion following his talk over dinner as our customers are well known for pushing the envelope and getting the most out of their IT investments.

Over the next couple of months our customers will get more details on the particulars of joining us for our 2008 Zerowait customer conference. I can assure you that it will be another educational and enjoyable conference.

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Summer is starting and with higher energy prices there might be some incentives for raising the thermostats in your Data Centers. However, one thing we have noticed over the years of supporting hard drives in the field is that higher temperatures cause disks to fail more often. When it comes to cost control, keeping a balance between disk failures and higher temperatures seems to be a question we are asked about often.

There seems to be a correlation between disks that are higher in racks and failures, although it could be a coincidence. Most people have a hazy understanding of their Data Center airflows , other than they notice hot spots and cooler spots within them. But hard drives need to be kept cool, so keeping your shelves of hard drives in the cool spots might help your drives last a bit longer. Unfortunately, moving your cabinet of drives to a formerly cool spot might make it a hot spot.

One thing is certain and that is heat rises. Keeping your data center on a lower floor and moving your servers and drives closer to the floor will keep them slightly cooler. Consolidating your storage islands onto fewer platforms and trying to rationalize your storage onto appropriate platforms for their usage patterns may save you money, buying new systems may look good, but often just consolidating you current storage will save you money by saving energy and extending the lifespan of your systems.

There are no magic solutions to the cost problem of cooling your data center. Consolidating and rationalizing your storage configurations will save your company money. If you have any proven ideas, send them our way and we will post them.

There is an announcement today that NetApp plans to increase its direct sales force.

Sunnyvale, Calif.-based NetApp (Nasdaq: NTAP), a data storage company that employs roughly 700 in the Triangle, plans on boosting its sales force by hundreds of workers in the next few months. The move is important so that NetApp can pick up market share, CEO Dan Warmenhoven told analysts in a late Wednesday conference call.

A bigger direct sales force would seem to create an area of potential conflict between NetApp’s inside sales force and their channel efforts . Perceptions of the channel can be different depending on where you stand, Somehow I don’t think a bigger direct sales force will be good for channel sales even though the channel seems to do well for NetApp.

About 64 percent of revenue in the period came from the channel, compared to about 60 percent last year. “We were hoping to hit the two-thirds mark, but didn’t quite make it,” said Dan Warmenhoven, chairman and CEO of NetApp, of the growth in channel revenue.

And how will the new Direct sales force work with their OEM? IBM may not be thrilled…

This rollout of fresh support for NetApp products comes amid some buzz among Wall Street analysts of increasing channel conflict between the two companies. “We are hearing of some increased pressures in the direct sales vs. IBM channel side of the business,” wrote Wachovia analysts Aaron Rakers, in an email to clients.

Storage consumers should have more parties to negotiate prices with as the NetApp sales department grows. I wonder if that will lessen conflict any?

Last week I was in New England visiting some of our customers . It was a great trip and it looks like we will picking up some more business from our clients. All the folks I met with are trying to save on their storage costs, and they recognize that our pricing model saves them a lot of budget dollars while allowing them to maintain their high reliability storage infrastructures.

A few of the customers I met touched on the costs of energy as part of their infrastructures. With budgets tight, and operational costs rising, purchasing new equipment has been pushed back and so our legacy support policies and pricing help them in a couple of ways. They can stretch their equipment lifespan and still afford their rising utility bills.

Teddy Roosevelt said in his autobiography
“Americans learn only from catastrophe and not from experience.”

Data centers and their operating costs may be a leading indicator of a looming problem. It seems that it may be time to start drilling and mining our domestic energy resources, as the costs and political intrigues of importing energy may be getting unsustainable, if costs continue to escalate. Outsourcing our data centers to other countries where energy is less expensive may happen if we don’t get energy costs under control.

As costs rise markets will find a solution, which is why customers come to Zerowait for an affordable support solution as compared to their OEM’s plans. Similarly, as energy costs increase, we need to find cheaper alternatives to our current suppliers. Affordable energy is a keystone required for economic growth.

Since IBM started reselling NetApp products a few years ago savvy customers have been playing the two companies sales organizations against each other. Now it seems analysts are noticing this is causing some consternation in the competitive channel organizations.

This rollout of fresh support for NetApp products comes amid some buzz among Wall Street analysts of increasing channel conflict between the two companies. “We are hearing of some increased pressures in the direct sales vs. IBM channel side of the business,” wrote Wachovia analysts Aaron Rakers, in an email to clients.

I am certain that IBM reviewed the history of NetApp’s failed relationships with Dell and Hitachi prior to getting involved with reselling Filers. Reviewing a company’s history with partnerships can’t predict everything, but it certainly pays to do research prior to getting involved with a company that has such a well established history of making tactical partnership decisions to the detriment of end users. In our experience it makes end users feel secure when they know they can depend on a strategic partnership which guarantees them long term service and support for their high end storage equipment. IBM knows the way things work, how do their new acquisitions figure into their long term strategic view of their NetApp relationship and enterprise NAS sales overall?

To say that many enterprise IT departments are cutting back on their IT expenditures would not be surprising to many of our customers. But it is interesting to notice that the Wall Street Journal has written an article on the issue. Many of our customers are asking us to help them Tweak and Tune their NetApp storage to make the equipment last longer and provide more usable storage to them. The WSJ mentions how companies are reviewing their infrastructure.

“Mr. Rapken met with his lieutenants and decided he could trim his budget for 2008 by 10%, an amount between $10 million and $20 million. The savings would come from replacing employee PCs every four years instead of every three years, delaying a payroll-software upgrade, reducing the company’s use of contract workers, and leaving vacant positions unfilled while laying off a small number of workers.

At the same time, Mr. Rapken had ideas to use technology to improve his company’s overall efficiency: He is spending less than $300,000 to tweak software that YRC already owns, so that it better automates how freight is moved and tracked. The change is expected to improve workers’ productivity, ultimately lowering overall costs.”

There are many ways to unlock your storage system’s potential and also to extend the lifespan of the equipment. Most companies have ever expanding computer storage requirements, but only a limited budget. Extending the lifespan of your systems and unlocking their storage potential is a great way to stretch your budget dollars.

Before you buy new, why not check to see what your legacy systems can do? They are not outdated just because the vendor’s sales team and engineering staff tell you it is.

An interesting note in today’s Byte and Switch caught my attention.

Pacific Growth Equities analyst Kaushik Roy discussed a possible Fujitsu/Exanet deal in a report on NetApp last week: “We are concerned that NetApp’s second largest OEM customer Fujitsu Siemens may buy high-end NAS vendor Exanet, which would be incrementally negative for NetApp,” he wrote. “If they do not buy privately held Exanet, we believe Fujitsu Siemens might at least resell Exanet’s high-end NAS solution.”

If this rumor is true, and viewed in conjunction with IBM’s recent acquisitions as detailed by Andy Monshaw in this article . It may be that NetApp is about to lose two very big reseller OEM customers. Mr Monshaw certainly seems to understand how to bring together the pieces of a storage solution.

“This idea that hardware is commoditizing and the value is moving to software and services, which is sort of a mantra, is complete nonsense. Elements of hardware commoditize, elements of software commoditize, elements of services commoditize, as they move to global resource pieces of service capabilities.

So I think evidence of investment in the IBM storage business speaks for itself: XIV, Softek, Novus, Arsenal, FileNet–all around this space in the last two years we have had a series of very specific investments. And I wouldn’t call any of these niche, point-play investments. These are real, honest-to-God capabilities that we’re bringing to this portfolio. “

Whether the storage business in commoditizing or not, there suddenly seems to be a lot of interest from big players in building a solution that fits squarely in NetApp’s market niche.

I wonder why that is?

What does virtualization mean anyway?

“[Virtualization is] a technique for hiding the physical characteristics of computing resources from the way in which other systems, applications, or end users interact with those resources. This includes making a single physical resource (such as a server, an operating system, an application, or storage device) appear to function as multiple logical resources; or it can include making multiple physical resources (such as storage devices or servers) appear as a single logical resource.”

I had a conversation with a buddy of mine who works in the financial industry and is looking at some directory virtualization software. After listening to the benefits of the software I asked a simple question – ” is virtualization cheaper than what you are doing now?” At first it looks like it is, but that may be marketing ROI’s and not based on the real world. It seems that there is a lot of expense involved in buying the software, migrating data, and managing another layer on your storage network. But, is it any less expensive then running your old storage as an archive, the old stuff is usually already paid for. Are virtualization vendors adding complexity to your already tangled network infrastructure? How much is it going to cost to remove the virtualized layers of obfuscation when ‘Simplificaton’ becomes the hyped buzzword in the industry press.

What ever happened to keeping things simple? When has complexity ever been cheaper to install, run and maintain for the long term ? When has complexity ever simplified debuging anything? How long will these Virtualization engines be supported? How do you untangle your Data if they go away or you change vendors?

Sounds like Virtualization really is a way of locking you in for the long term to a chosen vendor.