president of business continuity for SonicWall Inc., a network security company in Sunnyvale, Calif. Goodman founded San Francisco-based Lasso Logic Inc., the SMB backup and recovery company that was acquired by SonicWall 10 months ago. Before its acquisition, Lasso spent a year and a half developing continuous data protection (CDP) and off-site disaster recovery products specifically tailored for SMBs.
Storage requirements are getting more complicated, Goodman said. In a recent interview with SearchStorage.com, he described why users need to think hard about how to secure their network and how to protect data.
Steve Goodman: Well, we're really covering more of the "S" than the "M." Within that, we're very strong in financial services, very strong in healthcare and very strong in the legal field, although generally speaking healthcare and financial services are the strongest.
For example, one of our customers is a mortgage company based in Baltimore, National Fidelity Mortgage. They have several of our CDP boxes spread over their six locations. They're running SQL and Exchange, including at their branch office "end points." All of these applications are backing up to SonicWall as a secondary location -- the box backs up to itself and also to a centralized location. So if either the box or the facility goes down, the data is still in the cloud.
Another example is R.E. Grid Power, which bought firewalls from one of SonicWall's VARs [value added resellers]. At the time, the VAR was selling competing backup products, like Veritas, and the problem the user and the VAR were running into was that they were dealing with multiple products from multiple vendors. An SMB depends heavily on its VAR to keep life simple -- and creating a more simple life often means less vendors. The VAR was able to install CDP boxes across the power company, and they already had lost data they've had to recover at several locations. The thing they say they like about it is, if someone deletes even a row in a spreadsheet, that end user can get it back immediately without even calling an IT person. They don't have to call their VAR either for something minor, like losing part of a spreadsheet.
It seems like between the 'one throat to choke' concept and the granularity they're demanding, SMBs are becoming more and more like enterprise customers. Is that really the case? How are they still different?
This is the most important thing: It needs to be simple. The SMB doesn't have a team of IT people -- at most maybe two -- but the large share of users of SonicWall products have zero dedicated IT people, or they outsource to other companies. Simplicity is the No. 1 driver in this market.
At the end of the day, our appliance is a standard distribution architecture PC. The secret sauce is in the software. We are a software more than we are a hardware. We just wrap it up according to a PC platform, using off-the-shelf stuff. The software side has much better margins, so we can afford to go further down in price and still offer SMB customers enterprise-class features, like CDP and off-site disaster recovery.
Why is the SMB market such a hot one right now? Is it the last frontier, or are there other forces at work that have propelled it into the spotlight?
Goodman: Enterprise-class software is a saturated market. There are only so many customers to go around in the Global 2000 -- and they're all pretty mature when it comes to requirements on the software side. Meanwhile, as data has grown over the years, across all industries, the SMB segment is now facing the same challenges -- maybe even bigger problems -- than the enterprise. For example, if a virus hits an enterprise network, they have a team of guys to put out the fire. A smaller company may actually be put out of business. So NetApp [Network Appliance Inc.], EVault, EMC [Corp.] and all those guys are seeing that data requirements are exploding, and SMBs coming to grips with the fact that they need to buy storage and get into the storage marketplace with those big companies.
What's your advice to SMB customers as more and more of the big enterprise storage vendors try to market to them?
Goodman: I hate to hear it, but probably about 25% of the end customers I talk to don't even have a data protection strategy in place. There is still a big need to educate customers, that data protection and business continuance are important.
In the enterprise market, IT people get into religious battles, like Dell Inc. vs. HP [Hewlett-Packard Co.], SAP vs. PeopleSoft, things like that -- people very much know who the vendor is and care about it. Ask a 100-person company about their back-end system, if they can name it, and most of them can't. The SMB end user cares less about the brand of product and cares more about the partnership of the company they're dealing with.
So my first advice to users is to forget about vendors. Go find a partner -- a VAR, a consultant, a systems integrator-- that you really trust, that really understands IT generally and the exact requirements of IT within small and medium businesses. Second, I'd say it's very clear that the requirements of storage are growing exponentially across the board, and this makes those purchases more crucial right now and more complicated. I would urge users to spend a lot of time thinking about how to secure their network and how to protect data. How can you ensure, if your building flooded tomorrow or you lose power, that you are still running the next day? Forget about productivity for a minute, because productivity comes in lots of different ways. Worry about protection. After you have protection, productivity apps are a dime a dozen.