IBM India to Launch SaaS, Software-as-an-Appliance Licensing

IBM is coming up with new Software-as-a-Service and Software-as-an-Appliance licensing programs to grow its software product revenues in India.

The company, whose 2007 India revenue from infrastructure management software grew 50 percent over the previous year, wants to grow new business by 70 percent and total software revenues by 62 percent in 2008, said Aldrin D’Souza, Country Manager, Tivoli, IBM Software Group, on the sidelines of a Tivoli partner meet in Kovalam, Kerala, this week.

‘‘We have five top priorities in 2008 – establish leadership in new product offerings with key plays in automation, security and storage; penetrate market by investing in channels, system integrators; increase market awareness; improve customer satisfaction; and, build deep sales and technical skills, via programs such as IBM’s academic initiative in India,’’ Aldrin said.

IBM estimates that while the Indian enterprise software market would be worth some $1.7 billion, the middleware part of that market would account for 47 percent of it, or about $806 million. Within that, the infrastructure management software space, for products such as Tivoli, would account for $200 million, while storage (30 percent), systems management (26 percent) and security (18 percent) would account for the rest. Nearly half that opportunity, 48 percent, is in the small and medium business market, Aldrin noted.

Anil Menon, VP, Marketing and Software Group Systems, IBM India, told CRN that the company wanted to give a strong push to value-added distributors to take control of business, recruit SIs and ISVs, focus on repeat business, and improve partner capabilities on sales, pre-sales and deployment.

‘‘We have changed our sales model to be partner-friendly; we are helping ISVs build SOA-compliant products by offering them SOA validation and certification services; and, we are coming up with SaaS and Software-as-an-Appliance licensing programs,” informed Menon.

IBM initiated a partner program called Software Value Incentive program last year and has enrolled 54 members in India. Menon said partners in the program were making upwards of 35 percent margins.

‘‘They need to get an IBM World Industry Network certification to be part of the SVI program. Once in, some partners identify and sell; others identify, sell and fulfill the orders. We incentivise ‘good behaviour’, which is going the whole hog. We also give them special rebates for selling to SMB, because by doing so the partners help IBM reduce its selling costs,” added Menon.

‘‘We have barely scratched the surface in India. There are lots of deployments yet to happen. So, we have a sectoral focus on emerging solutions within which we have a High-Value Business Development group working on such markets as retail and healthcare. At the same time, we are also building foundations such as Safe Architecture standards into our software that will give us leadership when the market grows and mature.”