But Wait, There's More
AMR Says Small Manufacturers, Services Firms Looking at ERP Software Bigtime
According to a recent survey of businesses in the manufacturing and services sectors done by AMR Research and Managing Automation magazine, small businesses who do not yet have ERP solutions are getting fixed to buy them, and those that have recently installed them are looking to expand what they are doing.
In a survey of 550 companies, the small companies polled (those with fewer than 500 employees) were only using real ERP software 27 percent of the time. Midrange companies (with 500 to 2,499 employees) had ERP software installed 57 percent of the time, and large enterprises (with more than 2,500 employees) had ERP systems 70 percent of the time. It is important to note that 70 percent of the companies polled were in the manufacturing sector, while only 30 percent were in the services sector. AMR and Managing Automation found that 16 percent of companies participating in the survey were evaluating an ERP system for the first time this year, and that another 40 percent of companies polled had just completed their company's initial ERP rollout in the past two years. About half of the respondents said that they would be making substantial changes to their ERP systems in the next 12 to 18 months. Of course, how much of that is by choice--considering how much consolidation is going on in the ERP business--is unclear.
Esker Says Companies Still Run Their Businesses in Spreadsheets and Word Processors
If you are still somewhat uncomfortable with electronic invoicing and online banking, you are not alone. According to a survey of 500 finance and billing employees at companies in North America performed by Esker Software, 73 percent of those polled said that they still generate business documents such as invoices, purchase orders, contracts, and other documents with word processors; another 45 percent use desktop spreadsheet programs as well to generate these documents. The Esker poll also showed that 82 percent of companies would rather get their bills by old-fashioned snail mail. About 64 percent of billing managers used snail mail to push out invoices. Clearly, all of the companies that peddle electronic document management software have not entirely reached corporations with the idea that they can speed delivery of invoices and save money by getting this correspondence into fax or email and out of the post.
Big Blue Gives Big Trade-Ins to Spur p5 590 and 595 Sales--How About the iSeries?
AIX shops that are looking to swap their Power4-based pSeries 670 or 690 server to a new p5 590 or 595 are getting a great deal from IBM. If they order between now and June 24--which is a week before the end of the second quarter and is enough time for IBM to ship the new box and book the sale in the second quarter--then IBM will give them some free processor core activations and a big trade-in credit. Customers with similar iSeries iron moving to similar i5 iron should demand exactly the same treatment. So check out the deal.
As is the case with similar IBM deals, the amount of the trade-in credit depends on the machine you are swapping out and the machine you are moving to. The credit ranges from $45,000 to $240,000 and the free processor activations range from 4 to 16. Basically, IBM is giving you some cash and a lot of processing capacity for your old pSeries box instead of just cash for the pSeries machine and a steep discount on the new box. This does two things. First, it allows IBM to get a very valuable pSeries machine for peanuts, which it can resell for more money through its Global Financing unit to companies who don't want or need to move to a p5; and it can also chop it up for parts and sell those parts. Moreover, it allows IBM to book a sale for the new p5 at a relatively high price, which boosts its revenues--at least until the trade-in credit check is cut back to the customer. To take part in the deal, you have to buy a p5 with 16, 24, or 32 processors activated, which is a pretty expensive box. But for customers looking to consolidate several pSeries servers or who have big capacity needs, this deal will fit the bill. The same will hold true for big iSeries shops, obviously. Which is why we bothered to bring it up.
MKS Sees Revenues and Profits Boost in Latest Quarter
The software change management market is growing like gangbusters, and the iSeries is helping to contribute to this growth. Waterloo, Ontario-based MKS reported last week that it has grown its sales by 29 percent in its fiscal 2005 year ended April 30, growing from $32 million to $41.3 million in sales; the company swung to a $2.7 million profit from a loss of $1.5 million in the prior year. Those losses were caused mostly by investments in the application lifecycle management--MKS' new name for its expanded software change management offerings. In fiscal 2005, MKS said that sales for these products grew by 41 percent to $32.5 million and operating income swung from a loss of $4 million to a gain of $500,000. In the final quarter if the fiscal year, sales were up 50 percent to $10.2 million.
"We were extremely satisfied with our company's progress in 2005, both in financial and strategic terms," said Philip Deck, MKS chairman and CEO. "While setting all-time revenue and profit records and bringing our ALM business into profitability for the full year, we also dramatically expanded the scope of our enterprise product and accordingly, the customer markets we address." MKS is projecting that sales will be between $45 million and $49 million in fiscal 2006, which means the company thinks growth will continue apace.
Venture Capitalists Complete Attachmate Buy, Deny Rumors of Product Discontinuance
The venture capitalist group that bought connectivity software provider WRQ in December 2004 and followed up that acquisition by buying rival Attachmate in April has finished that deal and is now operating under the name AttachmateWRQ. The company says that the consolidation of the two companies' operations will be finished within the next 60 to 90 days.
Jeff Hawn, AttachmateWRQ's chairman and CEO, said that the company aims to honor all existing contracts and commitments, and he was keen on putting to rest some rumors that have been going around that one of the product lines would be discontinued. He did not want to provide any details on product roadmaps yet, but he did want to put to rest these rumors. "We have no plans to discontinue any products," he explained. "AttachmateWRQ listens closely to customers; we will continue to work with them to determine how best to meet their needs."
Golden Gate Capital, Francisco Partners, and Thoma Cressey Equity Partners are the investors behind AttachmateWRQ.
IBM's Big Bad Winders Box
The vast majority of iSeries shops have Windows-based file, print, and sometimes Web and application servers in their data centers and departments, and while we can argue about the wisdom of this, it is certainly true. Many of these customers have some pretty hefty Windows workloads, in fact, and ones that are much larger than can be supported on the Integrated xSeries Server (IxS) co-processor for the iSeries. And for those customers who might be running out of power, IBM has delivered its biggest, baddest Winders box yet: the xSeries 460, which will span up to 32 of Intel's 64-bit Xeon processors. While the machine will also support Linux and can technically support the open source BSD variants of Unix and even SCO Group's UnixWare, Windows will likely be the dominant operating system on the xSeries 460.
Our sister newsletter, The Windows Observer, has a detailed analysis of the xSeries 460, which you can read by clicking here. Check it out. While the scalability of the xSeries 460 looks pretty good for a Windows box, it is hard to say how far it will scale. It looks like maybe as high as 750,000 transactions per minute on the TPC-C transaction processing test, based on the fact that the eight-way box using the 3.33 GHz "Potomac" chips from Intel did just over 250,000. By comparison, an i5 595 with 64 processors running at a mere 1.65 GHz was able to do about 1.5 million TPM by my estimates, and a 32-way would probably do 850,000 TPM. That's quite a bit more performance for half the clocks.
Red Hat, IBM Work Together on Linux Training
Having just read the projections from Gartner on IT employee headcount dropping by 15% in the next five years (which we reported on in last week's But Wait, There's More column), you might think, "What are the current and future programmers of the world to do?"
Become experts in open source, of course, and compete with the millions of programmers around the world who will be doing exactly the same thing. Open source is a meritocracy, so connections, geography, and economic class only help so much. Education and skills are the key, and both Red Hat and IBM are going to play up their skills in getting your skills up to par--and take your money, too.
Red Hat and IBM have announced that they will collaborate on curricula for their respective Red Hat Academy and Academic Initiative for Linux programs, an expansion of a partnership that the two companies have had for Linux training since 1999. In this case, Red Hat and IBM are developing Linux courses that will be provided either free or for a fee (there's that money thing again) to colleges and universities so they can beef up their open source curricula. Red Hat's current courses and tests are based solely on the Web, while IBM has a mix of traditional paper-based and Web-based courses.