KS2 Expands IBM i Managed Services Biz Into Hosting, Co-Lo

Corrected: June 20, 2011

by Alex Woodie

KS2 Technologies, an IBM reseller based near Dallas, is expanding its managed services business into server co-location and hosting, the company announced last week. Under the new plans, KS2 will manage the complete IBM i environment for its customers, and even house the IBM i server in one of its data centers.

KS2 has been in the AS/400 business since it was founded in 1992. About seven years ago, the Grapevine, Texas, company--which is a premier IBM business partner and a member of Arrow Electronics' distribution channel--began its JD Edwards practice. Today about 60 percent of KS2's customers use JDE World and EnterpriseOne to run their businesses in the energy, manufacturing, and distribution industries, among others.

Managed services has been a staple of KS2 for some time, and that segment of the business is growing quickly as a percentage of overall company revenue. The vendor's service menu ranges from providing system administration and performing system upgrades to writing JD Edwards reports and helping with year-end processing.

In most cases up to this point, the vendor has provided personnel who work on servers located at customers' sites, KS2 president Dan Shinedling tells IT Jungle. "It has kind of morphed into 'Just take my box and manage it for me,'" he says.

KS2's customers get the advantage of having several experienced technicians available to them, without the cost and overhead of hiring their own administrators. And the customer's capability to pay for only what they use is another appealing aspect of outsourcing the management of an enterprise environment such as the IBM i platform.

In many cases, managed services engagements start with the customer's desire to have a cold site ready for disaster recovery (DR) purposes, Shinedling says. "They want a place to put their backup system. But then they'll see that the place they want to put their backup system is a lot better [than their own]," he says. "When they see what they can have for a production site, they say, 'Well I'm going to put my production site here, and run my backup system in the warehouse.'"

It costs a lot of money to build or acquire a top-tier data center, and that doesn't make financial sense for many companies. Handing the care and feeding of a server may make the most sense for those smaller businesses that can't justify capital investments or afford the personnel to run a server and a data center. KS2 has invested substantial sums in ensuring that its Grapevine data center has the requisite infrastructure--including multiple backup generators, proximity to high-speed networks, and solid physical security--to minimize the possibility of interruption.

While KS2's data center may not survive a direct hit from one of the large F4 tornadoes meandering across the plains this spring, it does provide more protection of servers and critical data than your typical warehouse or data closet. When companies get access to such data centers, it changes their DR requirements, Shinedling says.

"When you have a less hardened facility, companies need a backup site more," he says. "But if they have a more hardened facility, then the risk goes down, and they don't need to invest as much in a backup or DR scenario."

Redundancy is always a good thing in the DR world, and KS2 is looking to build or acquire a second data center in the north Dallas-Fort Worth metro area. It also made a big personnel move in the hiring of Bob Cowain, an IBM i expert with more than 24 years of experience on the platform, as part of its expansion into managed services and co-location for IBM i servers.

As its senior systems engineer, Cowain will provide services in the more complex and technical aspects of IBM i operations and management. Not every managed service or co-location engagement will require an IBM i professional with Cowain's level expertise, but it's definitely good to have on hand, Shinedling says.

KS2's new business unit will give customers more bang for their personnel buck, whether they're locating their box in KS2's data center or just having personnel manage it remotely, Shinedling says.

"It's getting harder and harder for smaller companies to keep those IBM i skills with their in-house people," he says. "We're able to attract really good talent because our folks know they get to work for a lot of different business in a lot of different industries, and they learn more in the process. They can share that experience with customers. For the cost of maybe one full time person or less, they can engage with a company like ours and get access to a team of people that are experts and have seen all types of different systems."

For more information, see KS2 Technologies Web site at www.ks2inc.com.

This article was corrected. The correct website for KS2 Technologies is www.ks2inc.com. IT Jungle regrets the error.

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