CCSi is a 20-year-old company that serves only the needs of the U.S. government. That’s quite a hefty client for anyone to handle. The U.S. government requires all the same types of support as any other organization. Since the information it handles is much more sensitive that what the average company does, CCSI has its work cut out for it.
Sramana Mitra: Hi, Joseph. Let’s start with your background as well as some context about CCSI. >>>
Sramana Mitra: So, you do deals whereby you bring new products into your channel on a revenue-sharing basis?
Chris Gatch: A lot of the services we sell to our customers are with third-party partners. Our desktop security product was delivered in partnership with F Secure. Our desktop backup product is in partnership with a large cloud-based storage provider. For a lot of those, we might white label them and sell them directly as Cbeyond products, but that’s not always the case. There’s still product development effort on our part to communicate an offer like that into our base, productize it, and have the ability to support it and all that. It’s not a long tail. There are targeted opportunities for us, and therefore there are not tons of them that we do. But we do have a history of doing revenue sharing with partners; it’s just select on our part. >>>
Sramana Mitra: It’s very exciting that small businesses can afford technology at a completely different order of magnitude.
Chris Gatch: Yes, it’s amazing. The capital required to start businesses now is dramatically less. The dollars involved in VC rounds have gone down as a result of cloud technology. What’s cool is that the stuff the progressive entrepreneurial set – you know, these born-on-the-Web companies – have been taking advantage of for a few years is now moving even to the Main Street small businesses, which is where I’d say we live. We’re the average small business. It’s cool to see it making it down to those kinds of companies. >>>
SM: What is the impact of Apple in all of this?
CG: They’ve changed the browser landscape pretty considerably. They’ve driven HTML 5 shift in the industry and are forcing customers to have to redevelop sites that are moving away from Flash. We haven’t to have client solutions for tools that we roll out that support Mac. Their penetration within the SMB space is high enough. It’s probably around 10%. You have to pay attention. In the business segment, especially SMB, they haven’t been nearly as big a driver or game changer as they have been in the consumer segment. But they’re there. You have to support those clients. Outside of that, I haven’t seen it as a big landscape changer in the business scene. >>>
Sramana Mitra: The best way for us to understand the business and the dynamics of the business environment in which you play is to do use cases and segments. That’s why I’m leading you down this path.
Chris Gatch: Sure. To that end, let me give you an example. We have a customer that’s a property management company. If I look into the systems that the company uses, it has Microsoft Exchange that’s hosted on site. There’s a property management application that’s hosted on site. But when you look at the payroll system, it’s ADP, which is a SaaS-based solution. We’re moving those applications that ran on site into the cloud. When we’re done, the company will have no physical infrastructure on site, and it will have a combination of applications that run on a private environment hosted on our total cloud data center product suite. And then it will have some SaaS services that it consumes as well. That’s what I see when I look out across most SMBs. I see some combination like that. >>>
Sramana Mitra: And what does it cost?
Chris Gatch: It’s going to vary. A cloud data center can start at about $350 for a private center, which includes a completely segmented network environment, a logically separate firewall, about half a terabyte of storage, and a modest level of computing resources. It can scale to much larger numbers depending on what kind of cloud infrastructure the client needs. On the hosted telephony side, for a total cloud phone system, like most hosted PBX offers that are in the market, the price probably settles around $25 a user. That’s not counting international usage. If it’s a distributed virtual company with international locations, that figure could change considerably. >>>
It’s nice to have an IT team on staff, but that’s not affordable for all businesses, especially small and medium businesses. That’s where managed services providers like Cbeyond come in. They offer small and medium businesses the same level of services that they would receive with on-staff IT teams at a fraction of the overall cost.
Sramana Mitra: Hi, Chris. Let’s start with some context. What do you do? Where are you going directionally? What is your personal background? >>>
Sramana Mitra: I heard two broad categories. One is around information security. The other piece that I heard is around analytics of data that these machines are generating. Could we take a use case and look at what kinds of data are being collected in these processes?
Steve Pavlovsky: If we think about our architecture today, if you start at the machine level, you’ve got sensors that are collecting inputs off the machine. They might be position sensors of some sort. They might be vision sensors. They might be thermal sensors or thermocouples. You have a whole set of process variable data coming in, and then you have what the machine state is and the process state and what we in our industry call outputs. What motor speed was a motor turned to, or what other actions were taken? You’ve got an aggregation of data in terms of the current status of the machine, the work elements going on in the machine, and what the control system is telling that machine to do. >>>