DataSynapse Boss on Company’s Success

By By Derrick Harris, Editor

October 3, 2005

In a recent interview with GRIDtoday editor Derrick Harris, DataSynapse CEO Peter Lee discusses the company's path to success in the Grid market — a path that led to record revenues in the first half of the year. Lee also gives an introduction to FabricServer, DataSynapse's new product that brings Grid's benefits to transactional applications.



GRIDtoday:
How is everything going with DataSynapse? From the recent customer wins and financial statements, I'd say “pretty well,” but it's always good to hear it from the horse's mouth.

PETER LEE: We're certainly excited. We've experienced tremendous growth so far in the first half, and are expanding our footprint in the market. It's an exciting time at DataSynapse: adding new clients and new partners, opening offices in new geographies (Frankfurt and Milan) and growing our team both domestically and internationally.

Gt: What is it about DataSynapse that makes it such a successful company?

LEE: DataSynapse differentiates from other companies in terms of its strategy, its products and its people. Strategically, the company initially focused on global financial services clients — and now that there are three dozen customers, we're expanding rapidly into other market sectors, building from a dominant leadership position from within our initial install base. DataSynapse focused its product development efforts on delivering enterprise-class, real- time infrastructure software that could easily interoperate with existing IT architectures vs. point solutions targeted for a specific market sector that would be challenging to integrate. We have been fortunate to recruit and retain the very best people in the business!

Gt: The company has a lot of financial services customers. Is that by design, or have financial services companies just been more receptive to the idea of Grid computing?

LEE: Arguably, it's a bit of both. As I said, we initially focused on financial services by design, based on our domain expertise and also based on the fact that, as an industry, there was very specific and pressing pain that Grid computing could address. Financial services companies are also in an intensively competitive marketplace environment, and thus tend to be early adopters of cutting-edge technologies.

Gt: Are you working with organizations in any other vertical markets? If so, who and how?

LEE: We're expanding our footprint into other verticals. Most recently, we've added another utility company as well as a global media company to our client roster. Right now, we count major companies in financial services, utilities, government, telco and media as customers.

Gt: Financial services aside, which vertical markets do you see as leaders in Grid adoption?

LEE: Financial services dominates, but we are seeing strong interest across many general market sectors including telco, energy and manufacturing.

Gt: Do you have different sales pitches for different markets? What are differences, for example, in pitching Grid to an automotive user vs. a pharma user vs. a financial services user?

LEE: The customer will always define the specific business value derived from using a technology to solve a particular problem. It is important to emphasize the key benefits of Grid adoption, which are common to all sectors and are irrefutably valuable: higher service levels at radically lower costs. Business agility from a responsive IT infrastructure always adds value, and the quantification can be worked out by the client using metrics they are most comfortable with.

Gt: From your perspective, what does the enterprise Grid market look like, overall? Are vendors doing a good job in selling Grid to users, or do we have a long way to go in educating users on the benefits of Grid technology?

LEE: The market is becoming significantly more aware of the production-proven benefits of Grid technology. I won't comment for other vendors, but we believe our client adoption speaks for itself.

Gt: What kind of timeframe do you see for widespread enterprise Grid adoption?

LEE: Within three years. Broad-based adoption is happening now in finance, and other sectors are spinning up rapidly. As Grid adoption becomes more widespread, more and more companies will look to use Grid to solve their business problems.

Now, at GridWorld, we're launching our next-generation product, FabricServer, which brings the power of Grid computing to transactional applications. With FabricServer, we wanted to provide the marketplace with an easy to use, out of the box solution for Grid-enabling application server-based environments including BEA, JBoss and Oracle. FabricServer makes it possible to quickly scale and share these Web-based, service-oriented applications with greater control and less complexity.

Gt: How long have you been involved with Grid computing? What have been some of the biggest changes you have seen within the industry in that time?

LEE:
We founded DataSynapse in early 2000. The biggest change is that it used to feel like it was us evangelizing the benefits; today, the largest vendors in the world have pivoted their strategies around the promise of this technology. For example: IBM: On Demand Computing; HP: The Adaptive Enterprise; Sun: N1/Grid; Oracle: 10G (Grid); EMC: Virtual Computing; Veritas: Utility Computing; and more. The recent MegaGrid project, for example, includes Intel, Dell, Oracle, EMC and Cisco. The Grid is becoming integrated across the enterprise.

Another big shift is that we're spending less time explaining what Grid is, and spending more time helping customers understand how this technology impacts their broader IT objectives of moving toward service-oriented architectures.

Gt: Do you find that DataSynapse has to do a lot of convincing potential adopters that Grid computing is not just a tool for researchers or those looking to utilize it in an HPC capacity?

LEE: We haven't found that we've had to do a lot of convincing, just educating. Once potential adopters fully understand the tremendous benefits that Grid computing brings to a company, the decision is an easy one. We're talking about speeding up application development times, accelerating product time to market, decreasing TCO and expanding existing capabilities-in short, Grid computing is making companies money. We've had customers who credit their Grid implementations for generating new business opportunities and driving revenue. One client attributes $50 million in new revenue creation in the first year of production. Distributed computing has its roots in research, but what we're offering for today's business applications is light years away from that.

Gt: Finally, what do you think it will take for Grid computing to become as pervasive as vendors and industry organizations would like it to be?

LEE: First of all, many of our customers who deal with infrastructure immediately understand the benefits of Grid computing. However, often the substantial business benefits of such an implementation aren't conveyed as well to decision makers across the company. Often, the natural reaction to upgrading IT systems is to push back because it's so often associated with higher IT spend and increasing operating costs. This reaction is understandable and expected; historically — and even currently — many organizations that use siloed architectures have to spend money in order to increase compute capacity, and they rarely see more than just marginal gains in value as a result.

Proponents need to more effectively communicate that Grid computing is really a paradigm shift for the network that drives business results. This is a disruptive technology that has the potential for dramatically increasing a company's capabilities, without increasing costs. Once this is effectively communicated and understood, Grid computing will become a pervasive technology, and those early adopters will have a leg up on the competition. At some point, it may become more difficult to avoid Grid, as ecosystems are already increasingly converging, involving infrastructure software, applications, and IT physical infrastructure.

Gt: Is there anything else you would like to add, perhaps a little more on FabricServer?

LEE: It's an exciting time at DataSynapse. On the heels of a record first half year in revenues, as I mentioned earlier, we're very excited about the upcoming release of FabricServer. It opens up a whole new world of applications that can now leverage the benefits of Grid: increased agility and responsiveness, lower costs, improved service levels and so forth.

FabricServer is designed specifically for transactional applications whereas GridServer has been optimized for compute- and data-intensive applications. Both bring incredible value to the enterprise, depending on the business needs.

FabricServer is also a lightweight technology, which means companies can deploy it rapidly and easily scale Web and service-oriented applications.  At the same time, it still has all the great benefits you would expect from our products: policy-based service provisioning, simple and predictable scaling and out-of-the-box integration that delivers significant economies of scale. We believe this will usher in the next generation of Grid computing, as more and more companies transition to an integrated service-oriented architecture model and rely on the Grid for superior performance of business-critical applications.

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