Monday, January 05, 2009

Battle of the Brands

Matt Asay wrote a nice little blog post about Vyatta last week, Vyatta: Beating Cisco with open networks. The only bummer with the post was that it arrived on January 2 and many people probably didn't see it because of the holiday season. Matt's post references a TechTarget article by Pam Derringer and pulls a quote from analyst Tony Iams from Pam's article:

Tony Iams, an analyst with Rye Brook, N.Y.-based Ideas International, said the networking market continues to grow, but Vyatta faces a challenge because Cisco has such a strong brand name, and companies are reluctant to gamble with networks because they are so critical to operations.

"Open source can be disruptive with a cheaper product," Iams said. "But Vyatta has to overcome a lot of skepticism and reassure customers that they aren't sacrificing quality."

My reaction to Tony's statement is, yes, of course. You aren't telling me anything really new. Customers always generally favor tried and true products over new and untested products. Right up until the time that they don't and the new becomes the tried and true product and the old product goes the way of the dinosaur. This is simply the way that new products and ideas come to market and it happens over and over again.

And this quote, almost verbatim, is always trotted out by analysts when they are asked to comment on a new company. It's an old saw in the analyst business, as safe and solid as motherhood and apple pie. You can't go wrong with it, because it's so uncontroversial as to be almost content-free. I don't fault Tony for using it, any other analyst would have said the same thing, but it's simply FUD without any hard evidence.

To prove the point, let's take this same quote, run in through the Wayback Machine, and see what it sounds like in other contexts:

John Doe, an analyst with New York-based, Big Analysis, Inc., said the computer market continues to grow, but Microsoft faces a challenge because IBM has such a strong brand name, and companies are reluctant to gamble with computers and operating systems because they are so critical to operations.

"Windows can be disruptive with a cheaper product," Doe said. "But Microsoft has to overcome a lot of skepticism and reassure customers that they aren't sacrificing quality."

How about this one:

Jane Doe, an analyst with Conneticut-based, Amazing Insight, said the PBX market continues to grow, but Cisco faces a challenge because Lucent has such a strong brand name, and companies are reluctant to gamble with voice networks because they are so critical to operations.

"VoIP can be disruptive with a cheaper product," Doe said. "But Cisco has to overcome a lot of skepticism and reassure customers that they aren't sacrificing quality."

Or maybe this one:

Fred Doe, an analyst with San Jose-based, Total Future Clarity, said the Unix market continues to grow, but Red Hat faces a challenge because Sun has such a strong brand name, and companies are reluctant to gamble with servers because they are so critical to operations.

"Linux can be disruptive with a cheaper product," Doe said. "But Red Hat has to overcome a lot of skepticism and reassure customers that they aren't sacrificing quality."

See what I mean? This quote appears all the time, for all new companies. It's true, but it doesn't provide any insight.

Matt's posting concludes but giving a few ways that Vyatta can help build it's brand, and they're all good suggestions that we're already working on. If you're a Vyatta customer, you also know that what the Vyatta brand means to you and how conscious we are about making sure our customers are satisfied with what we deliver. In fact, four out of five customers say that we provide better service than the big name networking companies. And that fifth customer, the odd-man out? He says we provide about the same level of service.

So, are you sacrificing anything going with Vyatta? Our current customers say no. If anything, you're getting more. Does Vyatta have to convince even more people that we can do the job? Yes. Should you buy open source out of a sense of charity, based purely on religious commitment to open source ideals, eschewing pragmatism and business sense? Of course not. Vyatta has to compete and demonstrate that it can meet real business needs. Fortunately, we are. And you in today's environment you need to ask yourself whether you'd rather be sending your money to a company with one of the highest gross profit margins in the business or to a new company that can deliver what you need for a lot less.

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