So is SBS 2008 dead?

You guys read way too much into my postings.

For the record, I never said that SBS 2008 is dead. I did however say that the business model that exists around solely deploying and configuring an SBS network (be it 2003, or 2008 or even a Linux powered SOHO/SMB shop) is no longer a viable way to stay in business. Many of your garden variety SBSers came to the party because they were workstation or network geeks to begin with and with the help of the community and properly designed SMB product started rolling out servers.

Some remained there. Now they are either unemployed or working for $40K a year. Never underestimate just how much work is needed, even at $85-$100/hr to generate a decent salary. Those that took their lifestyle over their profession and didn’t train, expand, hire, specialize and expand offerings and lived simply on the endless demand for technology are now making their first sales, marketing and HR efforts and doing so with the tools that are only good in a market with a ton of demand and little skilled supply. You know the pitch: “Nobody knows how good you are before they hire you” which works to get your foot in the door. But when people cut down their IT funds, try to do more on their own, refuse to sign long term managed services contracts and try to haggle down on the cost of the services you are already providing because the very solution you brought into their business is now offering to undercut you?

But.. but.. but.. I’m a trusted advisor. Yeah. But times are tough and we’ve had to let go of a few people and we love you but we need to stay in business.

This is the kind of a thing you need to start thinking about before it happens. Like when all the banks failed. Like when the media started covering businesses, plants and sales falling to the oblivion. Like when Microsoft raised it’s middle finger to all it’s partners at WPC 2007 and then raised both middle fingers in the air at WPC 2008 and told us all they will compete with us directly. When Dell went after the MSPs and started undercutting their partners, jacking their deals and trying to push their services directly to the customer?

You see, when businesses are doing really well they are busy and are willing to do what it takes to get through obstacles quickly so they can go about their business. This involves outsourcing, building, investing, contracts, additional tools and spending money to make money.  

When things start to shrink the mindset changes, completely.

What can you learn from all this…

Well, for one, that planning and running a sound business is not a function of your convenience or lifestyle preference or inability or unwillingness to run a business. You are either seriously running your business and all aspects it entails – from reading business journals to studying the history to understanding global trends to monitoring your competitors activity and copying the successful business models. In ALL areas of the business – not just your ability to print a business card and send a SPAM mailer. You are in business first, an IT person second. If you disagree with that, look for a job.

Second, that Microsoft really messed up the timing to flip off all it’s partners and release an infrastructure product less than a week before saying that they will target the same audience with a product partners will have no play in. Oh, and the economy thing.

Third, that Microsoft – through its tradition of lopsided history of being both channel focused and anticompetitive monopoly being prosecuted and monitored on all continents – created the same quagmire they have in the enterprise down here in the SMB market. Through their actions they have lost the VAR loyalty that took years to build and the savvy (or shall I say only) remaining VARs are in a strong position and don’t see Microsoft or SBS for that matter as anything other than raw infrastructure components to deliver solutions on. Microsoft’s sales pitch has always been “Just Microsoft, ALL Microsoft” where the product in the box was all you needed, and the partners did the dirty job of getting it all to work. The savvy ones built solutions on top of it to the point that the underlying features of the new Microsoft releases don’t quite matter – the management of whats there matters – so the hero of the day is the IT company that mitigated the huge Internet Explorer hole the day it was announced, before it hit all the news.

Think about it this way though – let’s say you built a CRM or business automation process on top of SBS – your check comes in every month that the pile keeps on functioning and driving the business. What is your incentive to give Microsoft money? What is your incentive to spend hours upon hours of project work, which may not pan out in the best way possible, to upgrade what is essentially the guts of the real solution seen by your clients. That is why SBS 2008 isn’t being taken up, the remaining IT companies are headed by smart people that have seen this one coming.

This isn’t bragging, this isn’t gloating, this isn’t picking. This is the documentation of the IT business reality that we have in the SMB sector, so those of us that are thriving today don’t stop for a second to pound our chest about just how great and awesome we are – we need to look at the failures as much as we focus on success so we don’t end up in the same unfortunate spot others are in right now.

The tide is ALWAYS rising.

Finally, to answer your question directly. Is SBS 2008 dead? No. It’s just that Microsoft’s story no longer matters, it’s all about how the solution provider delivers the solution that address direct (and highly painful) problems not what Microsoft wants people to adapt to.