Fujitsu: Market shifting from UNIX to x86

By Shreehari Paliath Jan 25th 2012
Fujitsu: Market shifting from UNIX to x86

Do you believe that Fujitsu’s focus has changed in the last 2 —3 years in terms of the enterprise portfolio of products?

Talukdar: When we started operations here in India, we clearly saw a strong value proposition with our enterprise portfolio of products and solutions. The business has been largely in the enterprise solutions and products. That part of the strategy remains absolutely unchanged. But, what has changed is the focus on the volume business. As an incremental change, we would be focusing on the volume aspect more than before.

What is your primary focus when it comes to your enterprise products?

Talukdar: A lot of our successes have come around key solutions like consolidation and virtualization, high performance computing, storage and back-up archival. This has remained our focus since we started operations and continues to remains so.

How has the Eurozone crisis affected Fujitsu, especially with nearly 20 percent of your revenues being sourced from the European markets and Fujitsu’s president expressing his concerns about the situation?

Talukdar: I think there are pressures on the economy. It seems to have an impact around the world including India. A slowdown in third quarter is attributed to the rupee depreciating. With goods being imported you can observe an impact on most vendors. So, demand has also reduced. You will find that after a month or so, it’s an  industry-wide phenomenon and not just restricted to Fujitsu.

During the release of your PRIMEQUEST range of servers, you had mentioned that the shift will be toward the x86 server market from the UNIX one. Why do you predict this shift in the market?

Talukdar: A historic tracking records this shift. The UNIX market has declined over the years and not recovered. Overall, from a long term perspective, there is a shift from UNIX to x86 market. From a technological standpoint, with the new generation of processors, the price performance is compelling. There have been some interesting developments in the market, whereby the momentum had slowed down. Traditionally, HP, IBM and Sun have been the key players in the market. After the acquisition of Sun by Oracle, customers of Sun are unclear of Oracle’s strategy for this hardware segment and its future, especially because of Oracle’s predominant focus on software. Thereafter, Oracle also decided to discontinue its support to the Oracle application and database on Itanium which put a question mark on the UNIX box at HP. So, these two factors have negatively impacted the sentiment of the UNIX market. In the last quarter, we released PRIME QUEST servers, the response to which was positive which means that there is a desire for an alternative by the customer.

Fujitsu has a Global Cloud Platform, which is public cloud based. Have the services been extended to the Indian market and how you place this service?

Talukdar: Although we have not extended it to India, we are working on it from multiple levels as far the Cloud strategy is concerned. Lot of Cloud deployments here work as private clouds. So, we are building and delivering specific technology solutions to deliver a private cloud. Certainly, Fujitsu is building components that will help in building public cloud, but at the same time we are also focusing on  the private cloud.

Would Fujitsu be extending it here soon or are there any particular reasons for you shelving that expansion?

Talukdar: We will not be extending it in the near future. There is certainly an increasing interest on the Cloud in the Indian market. We believe that if we offer the Cloud solution in the market, we will require to build datacenters and other assets to support it. As Fujitsu is expanding its operations here, the time is not right yet for us to extend this service.

Fujitsu has partnerships with Microsoft and Siemens in the Cloud and unified communication domains respectively. How have these partnerships worked for the organization?

Talukdar: Partnerships are necessary for even an organization as large as Fujitsu. Clearly, they help in complementing the solutions that we have. This helps in the creating a complete product. We are not treading on each others toes here, rather, we ensure that the end-customer has a complete stack of solutions.

How do you view competition, especially in the server front? What are the challenges that you perceive?

Talukdar: Some of them have an advantage of  being early movers. But , Fujitsu has been the fastest growing server vendor in the last eight quarters, which shows that the customers are evaluating us. I believe it is two fold. The quality of the product can be attributed to the Japanese-German legacy, which is being appreciated. Secondly, the customers appreciate the additional layer like the resource orchestrator or high performance computing that we provide. Therefore, we have been considered as a serious alternative to the traditional players in the market. In terms of challenges, our overall presence is limited. We need to send the message across to wider cross-section of partners.

What are Fujitsu’s plans to enhance its limited presence and brand image? How do you intend to develop the channel community in India?

Talukdar: We have crossed the 300 customer mark this year. We have been given approval to proceed with a significant investment and brand-building strategy. We are on a hiring spree with regard to marketing. We are not investing in resources for direct sales. It will be directly through our partner ecosystem, and as our business ramps up, we will add more partners. Within our Select Partner Program, our initiative for 2012 will be to move our top partners to the next level called the Select Expert Partners. We will definitely increase the number of Select Partners as we go along and also have a robust ecosystem of partners other than the Select group of partners, so that we have more touch-points in place to improve our relationship in the channel space. Definitely in all forms, we are looking at expanding our channel presence.

So, would this initiative trickle down to the smaller markets in India?

Talukdar: We are still some distance away from saturation when it comes to the metro cities. There is still a lot of potential here. So, in this phase, we will focus on these areas. Probably, in the next phase of expansion, we should be focusing on the Tier-II cities.

Big data and VDI are two rising domains and Fujistu has a stake in both. What are your observations in this regard?

Talukdar: Until a few years ago, Fujitsu was a Japan-centric organization. We have realized that huge synergies can be brought if all parts of organization can work together. With data growth, there is a huge requirement for on-time data analytics and a need to create structured data from unstructured. Fujitsu is involved in all these domains. In fact,  the first platform to be certified between SAP’s HANA and a hardware vendor is on a Fujitsu platform.
In VDI, we bring an end-to-end solution offering, including finance options. We support back-end operations, which adds value to the customer. Personally, I think something more needs to be done in terms of VDI. In India the customers’ are savvy. At the same time, customers here are demanding, so the value equation has to be balanced. This aspect has to be better studied and managed to further improve adoption of VDI.

The Thailand floods have taken a toll on the production at most organizations. How has this affected Fujitsu as a whole?

Talukdar: We have a diversified supply chain. Therefore, we have alternate sources. But, the impact was very big and world supply chain was hit badly. So the production has been affected at Fujitsu too, and there has also been an upward revision of the prices due to the supply-demand gap. Although we are not immune to it, we would like to be believe that we have managed the situation reasonably well.

Finally, what are your plans for the next couple of quarters? Is there anything in particular for the Indian market?

Talukdar: We have big growth plan and significant brand building initiatives. To get big growth numbers, we will have to build our channel programs. The focus will be on the volume portfolio, which is a change from before.

We have been considered as a serious alternative to the traditional server players in the market

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