Former Power Systems GM Joins FalconStor For IBM i Push

February 7, 2022 Timothy Prickett Morgan

Virtual tape library software provider FalconStor, which has been in the market for more than two decades, has tapped a former manager of IBM’s Power Systems division – namely Doug Balog, who ran Power Systems from 2013 through 2017 – as a strategic advisor as it begins a more aggressive push into the IBM i market.

Balog is a familiar to long-time readers of The Four Hundred, of course. He ran System x server development at IBM from June 2004 through December 2009, significantly the BladeCenter converged blade server platform, then did a few years running IBM’s storage business, then its System z business, then Power Systems, then software defined storage, then storage services within the Global Technology Services part of Big Blue before it was spun out into Kyndryl. Balog retired from IBM in the fall of 2019, and started his own consulting business, called DB Group Consulting, in early 2020, just before the coronavirus pandemic hit, and it is in this capacity that he is an advisor to FalconStor.

FalconStor has been particularly busy during the pandemic, announcing that its StorSafe iteration of its VTL tool was able to be used as a backup as a service on the cloud in 2020 and specifically offered customers of IBM’s discontinued ProtecTIER virtual tape library a migration path and deal to get into StorSafe. Last year, FalconStor announced that it would be specifically targeting the broad managed service provider community in the IBM i space. The company, which is traded on the OTC exchange, also did two issues of its shares on the market to raise $4.14 million to fuel product development and market expansion.

“I think it is a great time to work with FalconStor and a great opportunity to leverage my background in IBM Systems and Power Systems and storage in particular,” Balog tells The Four Hundred. “Particularly with Power10 coming to market and IBM’s early success with the Power Virtual Server in the cloud and the other big clouds also adding Power Systems to their infrastructure. FalconStor is leveraging its long-established replication technology, its long established data encryption and deduplication for efficient replication and bringing it to not only IBM i clients but across Power on premises and in the hybrid cloud world. Hybrid cloud is going to continue to see huge growth going forward. So I think it’s a great time to help Todd Brooks, the company’s chief executive officer, and Chris Cummings, its vice president of marketing, to make this big pivot to be in a cloud-first company.”

Balog adds that when he was running Power Systems back in 2013 ahead of the Power8 launch and the clouds were emerging all around IBM and Big Blue itself bought hosting company SoftLayer to jumpstart the IBM cloud, and IBM formed the OpenPower Foundation with Google, this was the strategy that IBM developed Power Systems in the long run. (Admittedly, we think the strategy has taken a while for IBM to fulfill, and everyone took longer to get Power into the cloud than any of us wanted.)

“The vision we had was to get Power Systems to be a modern platform and to be everywhere companies want to run their workloads,” Balog continues. “And now, that vision is realized. “But moving data is hard, whether it is being replicated for backups or moved to run applications in a hybrid fashion. The good news is that FalconStor has the technology to get that data migrated securely, confidently. It is hard to pin down the size of the IBM i base and the Power Systems base, and I know you are chasing that number all of the time, but what I do know is that there are several hundred managed services providers out there in the IBM i space alone, and a lot of them sort of dropped a pin on a map and their customer base is the distance they can drive to, and many of them have hundreds of customers and their businesses are very robust. And this is a good place for FalconStor to start companies on a journey to the cloud.”

This is precisely correct analysis. And, I would add, there are hundreds of resellers and support partners – often the same companies – who in some fashion help with the on-premises IBM i systems in the world, and they will want to have an MSP partner that they can resell backup and replication services for.

Thus far, the number of resellers peddling backup and replication is small, and the number of on premises customers using it is small. If it is like anything else in the IBM i base, it is a 90/10 rule or 80/20 rule distribution, and by the way, the base is somewhere on the order of 140,000 customers for the entire Power Systems platform, with IBM i being about – you guess it – 85 percent of the total.

“A lot of this is still cutting to tape,” says Cummings. “But there are an increasing number of IBM i MSPs at the same time that customers who are doing their own VTL on premises are short staffed and they want to move that over to an MSP. It is getting hard to IBM i shops, who have a lot of homegrown applications and who have no intention of making a change away from them. They have to give up something because no one can work 24 hours a day. And they can offload both the on premises and the cloud backup, and even do tape backup from the cloud or from a replicated local copy, to a trusted partner because at the end of the day what matters is to have their data secure in multiple places.”

We talk about this nearly constantly, but every IBM i shop needs to do this because every IBM i shop is running mission critical applications. And IBM i shops are learning.

The partnership that FalconStor has with a managed service provider in the United Kingdom called Blue Chip, which was acquired by Service Express, which is based in Michigan, back in February 2021. (We talked about Bue Chip’s own Power cloud back in 2014 here.) Blue Chip has around 800 customers, most of them are in the United Kingdom, and 500 of them are on IBM i platforms and of these, 300 customers are making use of the FalconStor backup service that Blue Chip runs. This service has a 70 PB capacity, by the way. This ain’t no small operation.

Blue Chip can replicate on premises machines to its cloud or to any of the public clouds. FalconStor has partnerships with IBM Cloud, Amazon Web Services, and Microsoft Azure, and does not yet see a need for a partnership with Google Cloud, but this could be done when needed. (We agree with this assessment, given the relative youth of Google’s Power Systems offerings and the fact that it still does not have IBM i support in production as far as we know on its Power iron in the cloud.) The beautiful thing is now the much larger installed base of Service Express can be targeted with this FalconStor service and reach a much broader base of Power Systems customers.

This approach by FalconStor can be replicated across hundreds of MSPs. If they all don’t get eaten by a few big MSP conglomerates powered by all of the private equity cash slushing and sloshing around first, of course.

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