IBM Makes Midmarket Moves

IBM at PartnerWorld launched a series of partner initiatives along with a new low-end zSeries mainframe targeted at channel customers.

SAN FRANCISCO--IBM Monday here at PartnerWorld launched a series of partner initiatives along with a new low-end zSeries mainframe targeted at channel customers.

The IBM eServer zSeries 800 mainframe is designed to provide server consolidation for midmarket customers who deal primarily with IBM channel partners. IBM plans to distribute 70 percent to 80 percent of its sales through those business partners, according to Peter Rowley, general manager for IBM Global Business Partners, in White Plains, N.Y.

Rowley, who characterized the zSeries 800 as a low-priced entry mainframe, said it "will change the economics of mainframe computing."

It uses IBMs z/VM virtualization technology to consolidate from between 20 to hundreds of Sun Microsystems Inc. or Intel Corp. servers into a single mainframe.

In its partner initiatives, IBM announced its strategy to create a portfolio of best-of-breed applications for midsize companies through partners.

The Industry Solutions Portfolio Program is a process that IBM intends to use to work with partners at a field level globally.

Local business partners will provide and support IBM hardware, middleware, storage and printer offerings and services, which can be combined with IBM Global Financing.

The Industry Solutions Portfolio will target supply chain management, enterprise resource planning and business-to-business applications for certain industry segments.

IBM has already created an offering for fabrication and assembly manufacturers in Germany. By June IBM intends to expand that to include electrical and electronics, automotive suppliers, and consumer packaged goods segments.

IBM also intends to work with more business partners to resell its e-hosting services to the midmarket.

Although it launched a partner program for e-hosting last year in which partners were paid a fee for qualified leads, IBM will expand that by certifying business partners whom IBM trusts to handle complete responsibility for the clients support using the IBM brand.

IBM will also work to expand its hosting business through partners by linking partner Web environment design services with IBMs hosting through a program called IBM Managed Hosting – Infrastructure Solutions. IBM will work with partners who will manage Web servers hosted by IBM for the clients in a program called IBM Managed Hosting Infrastructure Solutions with Server Management.

As a part of its e-business on demand initiative, IBM also announced an alliance with MarketMile LLC to offer e-procurement services that are affordable for midsize companies.

MarketMile is "the sweet spot" provider for procurement services for the midmarket, said James Corgel, general manager of e-business hosting services at IBM, in Somers, N.Y.

The alliance calls for MarketMile, founded by American Express Co., to provide expanded application options, supplier enablement and functions for IBMs Leveraged Procurement Service.

"Buying well is a big issue for all companies, but only large companies have been able to leverage the efficiencies of the Internet to do that," said William Schaefer, vice president of procurement services at IBM Global Services, in Research Triangle Park, N.C. The alliance will combine the leverage IBM has already created with suppliers with IBMs hosting capability and the billing services of American Express, he added. "IBM negotiates with the suppliers, IBM hosts MarketMiles e-procurement software, and Amex provides the back-end services," he said.

The service could cost a prospective customer as little as $275,000 per year for a monthly subscription or fee per transaction. To help move midsize companies into the e-procurement space, where few have dared to venture, IBM will offer a try-and-buy program allowing clients to sign up for 90 days.

In other news at PartnerWorld, IBM launched a recruiting effort and added support for large life sciences software companies operating on IBM eServers; the WebServices on WebSphere initiative for deploying Web services on Java 2 Enterprise Edition technology; and a new host-based intrusion detection Managed Security Service offering based on Symantec Intruder Alert.