Sramana Mitra: What are some new categories of services you are seeing in the telecom business?
Tom Dibble: The two we are seeing predominantly are cloud services and content services. The lines are getting much blurrier now between classic telcos like AT&T or Horizon versus what AWS [Amazon Web Services] does. We are going to see a lot of competition in that market, as they are both competing for the same enterprise class of customers on a cloud-based service. >>>
Sramana Mitra: One thing we believe is that letting people use something for an unlimited period without charging them doesn’t really help monetization. Free trials, however, are much better ways of converting free customers to paying customers. Do you have a perspective on that?
Tom Dibble: It is very industry specific. If you look at the paywall model in media, it has proven to be very effective and directly correlated to the quality of the content. >>>
Sramana Mitra: Can you talk about how you are operating in that premium scenario with a good visual example? When does Aria kick in? Does anybody who tries to use OpenShift, for example, get into the Aria systems right away, or do they only get into it when premium services kick in?
Tom Dibble: I would not be comfortable divulging some of those strategies that Red Hat is doing. Many of these companies, Red Hat among them, view their strategy on pricing, packaging, and bundling and how they are leveraging the Aria platform to do customer acquisition and monetization as their key competitive advantages. >>>
Sramana Mitra: Talk through the examples you mentioned. Let’s take the industrial example first. How much of this are you seeing across the industrial segment? Is this an anomaly, or is this kind of subscription consumer service happening at a larger scale?
Tom Dibble: That is interesting, because if you asked me that two years ago I would have said it is an anomaly and an exception. Today, the acceleration rate cannot be overstated. The adoption level we are seeing from companies that would not have considered launching a new recurring service, much less embracing cloud-based architecture to enable it, is amazing. This is just getting started. It is the very early days. >>>
Tom Dibble is the CEO of Aria Systems, a company that offers the unique cloud-based “Aria Subscription Billing Platform,” which enables enterprises to manage subscriptions and billing. Tom holds a degree in economics with honors from the Syracuse University and has more than 20 years of enterprise experience, having worked for Goldman Sachs and Company, BEA Systems, and Oracle. In this interview he shares with us the features of the Aria cloud-based platform and discusses examples of use cases for which the platform, including telecom, industry, and open source.
Sramana Mitra: Tom, tell us a bit about what Aria Systems does and what your background is. >>>
Sramana Mitra: The middle to the end of the 1990s was really the golden era.
Rick Tinsley: Part of it was driven by the Telecom Act of 1996, because it wasn’t just enterprise, there were also large service providers and startup service providers who were buying a lot of new gear from new companies. That was the bubble. It was fun while it lasted. But after 2000 and 2001, when the bubble burst, it was a long dry spell. Today, because of virtualization technology and software defined networking, the networking industry is open again to new ideas and new companies that can deliver products very competitively and with very good capital efficiency. There are many great investment opportunities there, although companies in this generation don’t need as much capital to get established and build a given level of business. >>>
Sramana Mitra: That brings me to an observation that there has been a dramatic drop in networking-related venture or even angel deals. Can you comment on that?
Rick Tinsley: For many years most networking customers were just happy buying things from Cisco – you don’t get fired for buying things from Cisco. We have seen that metaphor play out in many industries over the years, but sooner or later, if technology offers a superior alternative, things will change. >>>
Sramana Mitra: Given that that is what you do, what trends do you see in the market right now? What are trends you are anticipating?
Rick Tinsley: The number one trend is affecting our business and all networking businesses right now. It is the move towards virtualizations. >>>