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Interview With Red Hat's George DeBono
Published Sep 5, 2012
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How big are the opportunities you see in the Middle East markets in 2012?
If you look at the numbers from IDC and Gartner, it is very clear from their independent opinions that in the near future, there will be only two operating systems for the enterprise space, one of which is Linux.
I\'ll tell you the story from outside the Middle East which will give this a little bit of context. We recently had an event where we had a very large Red Hat enterprise customer talk to us. He said something very enlightening. He said, "Look we're paying Red Hat over a million Euros a year, and that\'s great. But we need to be talking to you guys about how do we take that one and make it five and ten and then twenty. Because we totally understand that spending more money with you translates into a savings of sometimes 6 times the investment. This savings can be used as a future investment fund for developing new systems, processes and technologies for my business".
In the Middle East, we now have customers who are starting to wake up to the above realization, which means there is a huge amount of opportunities and potential for us. Red Hat, like most organizations today, is extremely conservative when it comes to investment in offices and manpower resources. However, we're investing significantly in the region and expanding rapidly across MENA. Not because of the opportunity that we see in 3 years\' time. But because of the opportunity that is here with us RIGHT NOW and the current demands that are being placed on us by our customers and partners.
We have also been moving for some time now from being a single product vendor to a multi-product vendor which again has led to an acceleration in opportunities.
In terms of middleware, we expect to see a continued strong contribution from middleware to our local performance. Currently, we have a number of household brand name cutomers who have begun implementing JBoss Enterprise Middleware and have already completed the initial stages of their project. These customers are beginning to move out of the test phase and into actual production. We also have a number of customers who are acknowledging the benefits of JBoss Enterprise Middleware and are migrating away from the community versions. On our part we help this process by building programs and plans around making it easier for the customer to carry out the migration.
Storage and viirtualization are other interesting areas for us here in the region with great potential. Virtualization is definitely becoming one of the most spoken about technologies in the region. Traditionally what has been virtualized very well in the customer landscape is their Windows based environments. While other environments like Linux and Unix were largely untouched. Our virtualization solution however addresses this by heavily targeting the enterprise class operating systems in the Linux and Unix space.
What elements will you be offering in order to make life easier for CIOs? (for eg, better products, better financing options etc.
With Red Hat’s unique subscription model, customers are spared from paying large up-front licensing costs. Instead, they receive ongoing value through consistent technology updates, security and bug fixes, expanding software and hardware certifications, access to the expertise of Red Hat Support, and more – all at an affordable, consistent subscription cost.
We are always working to improve the Red Hat customer experience. The Customer Portal provides one central area for customers to manage and maintain subscriptions, access the knowledge base, engage with Red Hat and its partners, and learn how to use Red Hat solutions most effectively.
Results from IDC research in April 2011 show that through more efficient operations, higher ratios of servers and users per administrator and significantly lower downtime cost annually, customers who have purchased Red Hat Enterprise Linux subscriptions have an opportunity to recover the money spent on their subscription very quickly. Key findings of the study include:
> Organizations that have standardized on Red Hat Enterprise Linux have more efficient IT staffs.
> Red Hat Enterprise Linux customers experience about one-fifth the amount of downtime as compared to organizations using primarily non-paid Linux distributions. With costs of downtime considered, Red Hat Enterprise Linux users spend less.
> Organizations that heavily use non-paid Linux end up with higher total operational costs by almost double.
Time to market for new application deployments can be greatly reduced with Red Hat Enterprise Linux.
What kind of partners do you usually look for?
We are not looking for a partner who is going to be dependent on Red Hat for its survival. We are looking for a partner who can take our technology, package it into a solution, which they can then deliver to a growing customer base - with the Red Hat piece being, if you like, the cream on top.
Red Hat relies heavily on partners in this region for our business success, in 2012 we will continue what we started this year in terms of focusing on our best partners. Those are defined not only by revenue but also very importantly in terms of proactivity, knowledgeability, strategic alignment and technical skills.
As what we provide is both enabling and disruptive, we need to focus on those partners that can help us spread the message and implement. This means that we need to continually look at our partners and ask are they the right ones, and if not, who do we need to add to the mix. As such there will be some churn within our partner community, but I see that as healthy, as it will mean that we are able to deliver more, diverse capability into the customer base.
Partners who are willing and able to work with us will reap the rewards. Now that Red Hat Enterprise Linux is mainstream, we will be able to put more emphasis on recruiting middleware and virtualisation partners. Finally, we aim to work a lot more closely with key ISVs, OEM partners and global System Integrator to increase our footprint locally of the larger size implementations.
What channel initiatives will you be lining up in 2012?
Since availability of skilled resources is a challenge for our partners, we\'re undertaking some plans to put more skill into the market. We\'re working on things like academic programs and beefing up our training offerings.
Partner acquisiton is high on our agenda. As we roll out more and more products and offerings to our customer base, we will start asking our partners to specialize rather than be generalists across the spectrum. They need to pick certain technologies and become very proficient and capable. Similarly, as we bring more products to market, we will look to go out and speak to new types of partners. For example, we are about to release a new and exciting storage technology for which we need to recruit new partners who are specialists in storage management.
In terms of incentives, Red Hat has a solid rebate scheme in place which distributors can pass on to resellers in term of cash discounts and other benefits which keep the channel on their toes and eager to work closer with us.
What's the message you would like to send out to your channel partners?
I'm going to start with something I guess a little bit unexpected. But the first message i\'d like to send out is a message of thanks. The market space that we are in is not the easiest market space for them. But our larger partners have embraced this. They understand the value that open source brings to the market and how to assist their customers in leveraging this. Our partners shouldn\'t see our organizational growth in the region and our direct involvement with customers as a threat. We are not going to change the model in terms of our fulfillment. It will remain 100% indirect and channel based. We will talk to large enterprise organizations and our conversations with those organizations is really all about sharing with them our vision and our strategy, understanding their vision and strategy and then mapping the two together.
I need all of our partners to realise that the growing presence that we have in the region is a growing resource pool for them. Our partners need to feel (and some of them already do) that they can call us at any time and have us visit customers along with them. We are not building a competitive force to them but a complimentary force FOR them. That's the model...and that\'s the message.
What are your growth plans in the Middle East for this year and the next, and what investments will you be making in order to reach these goals?
We have growth plans obviously and they are in line with our expected return. In 2011, we have doubled our presence here in the Middle East and we appreciate that this investment takes some time to reach its full potential.
Red Hat relies heavily on partners in this region for our business success, in 2012 we will continue what we started this year in terms of focusing on our best partners. Those are defined not only by revenue but also very importantly in terms of pro-activity, knowledge-ability, strategic alignment and technical skills.
As what we provide is both enabling and disruptive, we need to focus on those partners that can help us spread the message and implement. This means that we need to continually look at our partners and ask are they the right ones, and if not, who do we need to add to the mix. As such there will be some churn within our partner community, but I see that as healthy, as it will mean that we are able to deliver more, diverse capability into the customer base.
Partners who are willing and able to work with us will reap the rewards. Now that Red Hat Enterprise Linux is mainstream, we will be able to put more emphasis on recruiting middleware and virtualisation partners. Finally, we aim to work a lot more closely with key ISVs, OEM partners and global System Integrator to increase our footprint locally of the larger size implementations.
Profile of the company
Red Hat, the world\'s leading provider of open source solutions and an S&P 500 company, is headquartered in Raleigh, NC with more than 70 offices spanning the globe. Red Hat provides high-quality, affordable technology with its operating system platform, Red Hat Enterprise Linux, together with cloud, virtualization, management, storage and service-oriented architecture (SOA) solutions, including Red Hat Enterprise Virtualization and JBoss Enterprise Middleware. Red Hat also offers support, training and consulting services to its customers worldwide.
Posted by VMD - [Virtual Marketing Department]
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