Small Business Servers: Here Today, Gone Tomorrow?

The vast majority of new small businesses have zero IT infrastructure and will never need to purchase a server, asserts Narinder Singh, chief marketing officer at Appirio. Is Singh right or is he a cloud evangelist who’s out of touch with the small business IT channel? Here’s the spin from The VAR Guy.

First, a little background. Singh stepped into the spotlight this morning at the Ingram Micro Cloud Summit in Dallas. During his presentation, Singh described how Appirio — a cloud solutions provider — is deploying customer solutions on Google Apps, Salesforce.com and Amazon.com. Even as Appirio pushed beyond the 200-employee mark, the company has not purchased or deployed any on-premises servers within its own business, Singh said.

Hmmm… Is Singh alone? At the same conference, Don Schleicher, VP of service providers at VMware Inc., said he doesn’t see startup companies buying on-premises servers. But in his presentation, Schleicher did mention that SMBs “may or may not have on-premises virtualization.”

Similar Experience

Speaking from personal experience, The VAR Guy works within a company with roughly 15 to 20 peers. There’s no on-premises network. No dedicated server. So our resident blogger believes some start-up businesses will largely avoid the need for on-premises options like Microsoft Small Business Server.

And let’s not forget, Microsoft killed its mid-market Windows server platform in March 2010, and the company also killed the Response Point small business phone system in 2009.

Our resident blogger also is hearing more from MSPs that leverage virtual, shared office space — essentially a business time share wherein executives can leverage corporate meeting rooms, phone systems and executive assistants who make a small company look big. In the virtual office setting, the lease holder provides the network to MSPs, VARs and small business owners who come and go based on their own meeting schedules.

Big Disconnect?

Still, it’s unfair to say that servers and networks won’t find an on-premises home in start-up companies and small businesses.

Indeed, there are plenty of examples of VARs that continue to sell products and infrastructure into small business settings. HPM Networks, for one, promotes HP solutions into small and midsize businesses. The company expects to generate 2010 revenues of about $200 million, up from $93 million in 2009 — with minimal managed services revenue involved.

Meanwhile, some server makers are adjusting their product lineups to address the managed services market. Lenovo, for one, in early 2010 unveiled its first server designed specifically for MSPs. And HP has developed two platforms — 48Upper and Insight Remote Support — to help VARs and MSPs remotely manage small and midsize business servers.

The Bottom Line

So back to the Appirio thesis, which claims most new small businesses will have zero need for on-premises servers. As The VAR Guy often says: One size rarely fits all. Plenty of small businesses will still buy and deploy on-premises hardware.

But Appirio has a point… There’s certainly a small business niche that will have no servers. In fact, that’s the case within The VAR Guy’s own company.

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