Knocking On Doors And Talking About Cloud

November 3, 2014 Dan Burger

It’s not quite like walking through destiny’s door, but Patrick Schutz believes he’s in the right neighborhood. Surveying the situation, Schutz confidently predicts that cloud computing is exactly what many IBM midrange shops want. They’ve just needed some time get comfortable with the idea. According to Schutz, senior account executive at Abacus Solutions, an IBM i and Power Systems oriented managed service provider (MSP), the conversations about infrastructure as a service business have changed from if to when.

“In the past year, we have seen more interest and desire,” Schutz says with regard to Abacus’ interaction with the IBM i community. “Things are making more sense [for the i shops] and we are noticing interest in the cloud is two to three times higher than a year ago due to a combination of existing and new customer growth. It’s an indicator that the cloud is more mainstream than it was a year ago.”

Two years ago Abacus was busy endorsing the cloud concept (in this case, an infrastructure as a service arrangement) to any and all members of the IBM i community, but particularly to those in the greater Atlanta metropolitan area, where Abacus has set up camp for more than a dozen years. The conversation was mostly about why an organization would outsource its infrastructure. That conversation has changed, Schutz says, to how an organization can do it.

My question is how many IBM i shops are doing it.

Schutz is a guy who could answer that question, but he won’t.

“I don’t like sharing the numbers,” he admitted. “That’s private information.” In addition to posting that no trespassing sign, Schutz said he preferred avoiding any “we have more than you” comparisons.

It also avoids marking any stakes in the ground which could help identify growth rates. To smooth any correctly presumed ruffled feathers, he offered these colorless comparisons.

“Over the past few years, we’ve probably increased the customer growth at a 30 percent to 40 percent tick each year. That’s a compounding number. And our revenues have increased almost 2X.”

That’s as good as it gets and Abacus is no more guarded with its information than other companies doing business in the cloud. Seems like a business equivalent of shy bladder syndrome, not that my opinion will change corporate policies.

What Schutz has to say about the typical circumstance that brings an IBM i customer to Abacus is that the day-to-day operations are a burden. A factor in this view could be related to what Schutz describes as an involvement in “a lot of carve outs for new companies,” meaning acquisitions where a portion of the acquired company is isolated and resold, and in other buy and sell situations where setting up infrastructure in the cloud facilitates those circumstances.

“We see customers getting more involved at the application level, getting more focused on the business, and less interested in the ‘blocking and tackling’ of the infrastructure,” he says.

Abacus specializes in infrastructure and taking on layers of operations management because, Schutz points out, that’s the part of IT operations that companies want to shed and he contends companies are more receptive to that idea than they were just a year ago. The application side, which is closely related to a company’s business, remains in the hands of the company, which treats it as a differentiator and a competitive advantage. Schutz calls this a hybrid approach.

Providing options that allow companies to keep production servers on premise while testing processes and environments in the cloud has increased the comfort level of companies researching the cloud.

Abacus offers a virtual test drive that companies can use as an upgrade path to test their application environments at a newer OS level than it is currently running. An upgrade from i5/OS V5R4 to IBM i 6.1 or 7.1, as an example, can be cumbersome. Having the skills and experience to smooth that upgrade is what Abacus, the facilitator, brings to the table. And in the process of a company testing its apps in a more modern OS environment, they also get familiar with the cloud.

“A year ago, more than 50 percent of the opportunities were with customers at 5.4 and below,” Schutz says. “Now that percentage is below 50 percent–maybe in the 30 percent range–and we are seeing more 6.1 and 7.1 environments and some 7.2 environments.

Similar OS upgrade trends were reported by iTech Solutions in an IT Jungle article six weeks ago.

For Abacus, the OS upgrade experience typically has led to the sale of an on-premise system, but more recently it provides the comfort level that familiarizes a company with a managed infrastructure service and potentially a managed services contract.

High availability as a service is another entry point that Schutz says has led companies to the cloud. More than 50 percent of Abacus customers have decided 24×7 backup and the elimination of a backup window is important to their businesses. It comes under the category of “things that companies have always wanted but did not have the means to do it in the past,” he says.

“This may be laying the groundwork for some shops to get comfortable, but we are seeing net new customers ready for the cloud,” Schutz claims.

Another element of Abacus’ increase in cloud customer count and revenue is its capability to bring Windows servers to the cloud along with the i.

“Eighty percent of our customers have an iSeries and typically about a dozen Windows environments surrounding it. If they, the iSeries customers, go to the cloud they like to keep all these environments in the same bucket,” Schutz says.

“Companies that want to put i in the cloud have a concern that if they don’t put their Windows boxes in the cloud along with the i, there will be latency issues affecting the integration of the two systems. We’ve seen this as a trend with many customers. We bring the i in first and discover if there will be latency problems. If so, we bring the Windows servers in, too. Most often those are SQL Server databases, Exchange Servers email, domain controllers, and application servers. We can do some or all of the Windows servers. We don’t go after Windows business by itself, but when the i and Windows platforms are tied together, they often go in the cloud together.”