Thoroughly Modern: With Cloud, You Need To Crawl, Walk, Then Run

July 12, 2022 Timothy Prickett Morgan

The idea that all workloads are going to move to the cloud is a fallacy, and so is the idea that there will be only one cloud.

Some workloads will, by necessity due to issues of governance and data sovereignty, remain in the corporate datacenter; some will run in hybrid mode across local and cloud infrastructure; and some will be in the cloud for the rest of their electronic lives. And because of the breadth and depth of applications in the enterprise and the long-established relationships that companies have with their IT suppliers and business partners, there will be many providers of cloud services just like there have been myriad IT vendors and resellers for decades.

That’s not to say there will not be a tiering of capability, capacity, and experience out there on the cloud, of course. There certainly will be, and most IBM i customers, long experienced with a Cadillac system like the AS/400 and its progeny, are going to have very precise ideas about the level of service they will expect. This is not going to be a give us a credit card number and figure it out for yourself experience, like Amazon Web Services, Microsoft Azure, and Google Cloud are. IBM i customers will expect more, and they will get more.

Jeff Swartz, the newly appointed vice president of Abacus Solutions, the cloud and managed services business unit of Fresche Solutions, knows this probably better than anyone else in the IBM i market.

When Swartz graduated from the University of Southern California in 1987 with a bachelor’s degree in business administration and entrepreneurship, he wanted to get a job at IBM. Period. But Big Blue had a hiring freeze, and so the long and winding midrange road of Swartz leading to Fresche Solutions began.

Swartz came to the IBM midrange peripherally – and quite literally, as an account executive at memory and storage array provider EMC, then a fledgling company and only a three years from the launch of the Symmetrix arrays that would make it a datacenter powerhouse. Swartz was not impressed with the Guardian disk arrays that EMC was peddling for System/38s and for the AS/400s when they launched in June 1988, and six months later took a job at Marshall Lewis, a division of a leasing company called Neptune, which was eventually eaten by Sun Data, selling iron. He then did a stint at CSI Leasing, went to a small business partner called Advanced Systems Applications and Products, which was then acquired by Sirius Computer and was back under the umbrella of a midrange systems leasing company again. On to Gillian Technologies, a small Israeli security software company where a friend was chief information officer, for three years, and then back to the IBM midrange with Mainline Information Systems for 15 years, peddling iron.

“I had an epiphany one day that I was done selling hardware,” Swartz tells The Four Hundred. “I actually went to work for one of my customers, Baseline Data Services, as vice president of sales for its disaster recovery, managed services, and hosting, and I really liked this space. Then in early 2019, I went to work for Connectria as a regional director for southern California, and after a year, I was tapped to build their channel. At Connectria, I had Fresche Solutions as a partner, and I got to know the people at Fresche well and now I am being brought in to not only run sales for Abacus Solutions, but also to build its channel.”

The funny bit for Swartz, who as any good salesperson does, knows everyone in the entire business, is that the hosting business at Abacus Solutions was formed by former Sun Data employees. So it is a bit of a homecoming.

The plan Swartz has is fairly simple.

“Customers love this IBM i platform,” Swartz says. “But the issue they all face is the regular care and feeding of the system. So we want to lead with managed services to be able to take over the care and feeding and the day to day operations. And then we are going to offer disaster recovery and high availability, and from there, as customers get used to the cloud, we are going to offer running production workloads in our private cloud. It’s kind of the crawl, walk, run roadmap of how to be successful.”

It will be interesting to see how the threat of recession – for many companies and people, they are already in recession even if the overall economy is not – as well as the retirement of experienced system operators and developers changes attitudes about managed services and cloud. As we have said many times, we don’t think recessions cause technology transitions, but they do accelerate them. Server virtualization had been around even before the Dot-Com Bust, although it was arguably immature on the X86 platform, but the Great Recession caused an explosion in business for VMware because it allowed enterprises to forego a whole server upgrade cycle by running their existing machinery more efficiently by cramming more workloads onto them.

“Seasoned IT professionals are starting to tap out, and the coronavirus pandemic actually sped up that process,” Swartz explains. “I can’t tell you how many of the people in the IT organization that I know at my old customers who have socked away some money, their spouse is retired, and they are going to pull the string on that golden parachute. But besides that, COVID-19 all by itself has made companies aware that not only can they have managed services, but they need them. And moreover, it should not matter where their IBM system is located – their datacenter, our datacenter, or in a co-location facility. It should not matter where the workload is for it to be supported by managed services, and frankly, everyone was remote in the first year of the pandemic.”

The other thing that Swartz is starting to see because of inflation in general and the shortage of experienced IBM i operations professionals in particular is that the system operations guru who was paid $75,000 a year in the Midwest is now able to command $150,000 to $160,000 a year for a job on the coasts that can be done remotely. And that upward salary pressure means it will be more expensive, in the long run, for IBM i shops to do operations than it has been in the past.

Because Abacus can put eyes on multiple customers and use automation to extend that even further – just like the hyperscalers and big cloud builders do – it can not only shift a chunk of the IT budget from payroll and capital expense to the operation expense budget. The specific managed services costs are situational, and so are both the existing costs and the potential savings, so there is not a rule of thumb here that makes this simpler. Sorry.

“The cost of managed services will definitely be less, and the amount could be dramatic,” says Swartz.

The way to think about it is like this: If your operations people get a remote job on the coasts and doubles their salary, the managed services you get from Abacus to replace them will definitely cost less. And if you blessed with IT operations people who are happy with their current job and current salary even though we all know and they know they could command higher salaries elsewhere, if and when they leave, you will very likely save a little money, too, when they finally do retire and you tap Abacus to take over operations. Depending on what you do, it could cost a lot less.

The thing to remember is that Abacus wants to do whatever customers need today and be ready for future needs if they should arise.

“What we are not trying to do is go into IBM i shops and sell hosting and cloud everywhere,” Swartz says. “We are not trying to replace Power Systems hardware. We are leading with managed services because that is what customers need. Eventually, at some point in time, if it is appropriate, we can have a conversation with a customer about a full hosted solution. And when it comes right down to it, the thing that makes Fresche attractive to me and to customers is that it has a full suite of modernization tools as well as managed services and hosting now with Abacus.”

Jeff Swartz is vice president of sales at Abacus Solutions, a business unit of Fresche Solutions.

This content is sponsored by Fresche Solutions.

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