At first glance, Zentyal seems to be making all the right moves — raising more than $1 million to promote Linux into the small business server market. Zentyal is building a partner network for VARs — striving to counter Microsoft Small Business Server along the way. But The VAR Guy wonders: Can Zentyal really succeed in the SMB server software market — where so many other Linux distributions have failed?
Further complicating matters: Can Zentyal’s small business server software thrive when so many SMB customers are shifting their server budgets to cloud services?
Let’s start with some upbeat anecdotes. Zentyal raised $1 million in Series A venture capital from Open Ocean Capital in December 2011. Open Ocean Capital previously backed MySQL, the wildly popular open source database that Oracle ultimately acquired when it purchased Sun Microsystems.
On the partner front, Zentyal in November 2011 claimed to be in “conversations” with more than 1,000 IT providers worldwide. Around the same time, Zentyal partnered with Canonical, promoter of Ubuntu Linux. The deal calls for Zentyal channel partners to promote Zentyal small business servers, Ubuntu desktop and Ubuntu application servers.
Late to the Party?
Intriguing stuff. But here’s the core challenge: Zentyal may be targeting a market that’s past its prime. The VAR guy believes small business server sales will contract as more SMB customers shift to cloud services. With that potential reality in mind, rival Linux providers like Red Hat are attacking the SMB market purely through cloud services rather than on-premises servers.
Heck, even Microsoft faces an uphill battle in the SMB server market. During an Intermedia Partner Summit in New York last year, most attendees said they had stopped reselling Microsoft Small Business Server and shifted their focus to hosted Exchange, online storage and other cloud services.
Keeping the Cloud In Perspective
Still, perhaps The VAR Guy is overestimating the cloud’s impact on small business servers. Zentyal in December 2011 claimed to be generating more than 30,000 downloads per month and also claimed to be a “break-even” business, meaning that the company was no longer losing money.
Moreover, the Zentyal partner program includes tiers for managed services providers and cloud services providers — a clear effort to attract next-generation partners rather than traditional hardware resellers. Gold Partners, for instance, can host Zentyal in their own cloud.
How many gold partners will take advantage of that cloud perk? The VAR Guy is watching for updates.
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Tags: Canonical | Microsoft Small Business Server | Open Ocean Capital | Small Business Server | SMB Technologies | Ubuntu | Zentyal
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I’ve liked the concept behind Zentyal ever since they had just released as eBox, but one thing always bothered me — all the configuration files are in non-standard places. That broke the deal for me.
“The Cloud” or SAaS (Software As A Service) is inherently less secure than a local system because no provider of SAaS/Cloud is going to let you (the customer) dictate which versions of operating system and programs they will run, nor will they let you audit their network for security holes, and lastly, they won’t offer Indemnity Insurance to protect you, your business, and your data.
If you want total control over your computer hardware, software, data and security of them all, you need to setup your own server. ( You can even setup your own private cloud if you want to. )
Also, subscription services like SAaS/Cloud eventually cost more than if you host / do everything yourself.
Heh… Considering that they’re providing many of the functionalities that a company going “to the cloud” would need to secure the infrastructure to be able to do that even remotely safely, yeah, I think so.
It’s articles which question things in this manner that make me question whether The VAR Guy’s even worth my few minutes that I spend reading this article. It comes across as being actually clueless on critical aspects of things in the industry and only pandering to/parroting the big buzzword laden stuff the lemmings are all stampeding towards because it was branded as the next big thing…
Wow, I sometimes wonder if I am alone in questioning the value of the cloud. I think it has value for somethings. But I do have problems. The argument against @Ron is usually, I think a large corporation responsible for thousands of accounts or systems can have better security than a small IT group. Just ask Sony or Stratfor.
One of my big concerns is bandwidth. Saving files and retriving files takes longer through a Internet connection than my local 1Gig network. And I wonder how much time I waste waiting for damn web pages to refresh or update. How much time is everybody wasting waiting for web pages or applications to update their information.
Also, I like TheVARGuy, but @Frank has a good point and has expressed what I sometimes feel.
Thanks,
After my post I went and checked the Zentyl web site.
Their pricing was a little high compared to Novell’s Linux Small Business Server. Assuming I compiled what they were offering correctly. Alot of options that seemed like they should be built in. Disaster Recovery is an add-on module? Correct me if I am wrong.
The VAR Guy thanks all readers for weighing in. A few updated thoughts…
Frank@3: The VAR Guy welcomes constructive criticism and will keep your feedback in mind. However, The VAR Guy stands by his basic thesis… The SMB server market will shrink — not grow — over the next few years.
If Zentyl manages to position for the cloud as well there are already numerous rivals in place…
-TVG
Zentyal has a nice combination business going. I have no idea if they’re making money, but it’s nice from the customer’s point of view and supports increasing demands.
1) Local, unsupported installation for testing.
2) Supported local installation with off-site back-up handles by Zentyal.
3) Finally, the off-site backups are used during the migration to hosted Zentyal.
Our company currently uses a mix of cloud services and needs a local infrastructure to get there safely. In the cloud we use Google Apps and Nextiva as our PBX (Rackspace cloud for website and some app hosting). Locally we’ve been using Zentyal (previously eBox) for a year and a couple weeks now. 3 servers run as our router in 3 separate locations to VPN the networks together (plus a few people remotely working through VPN) each also have Web Proxy + Virus Scan + Firewall + one master LDAP & Radius. Another Zentyal as a Domain Controller and file server on a separate server that authenticates and stores home directories for about 35 employees and 2 other Zentyal servers as file servers. They all authenticate against one main Zentyal server and make server admin a breeze! We actually have an enterprise subscription as well.
The cloud is great but it is expensive (unless all the employees are tech savvy enough to not require IT). We are also seriously looking at Ubuntu Cloud and other private cloud solutions as it would definitely be cheaper in the long run. For network management it’s hands down the best solution for small to large networks. For e-mail and phone though they are still lacking in features at the moment (e-mail / cal, etc you will get the same experience as Microsoft Exchange Server, WONDERFUL syncing with Android and iPhone) but just can’t compete with the Google/Android experience at the moment. The phone/asterisk was honestly not working this time last year when we needed it, it’s most likely fixed by now.
Sorry forgot to add, most of the client machines are Windows XP or 7, a handful of Macs and my Ubuntu Desktop. Ironically, all the Windows machines are the ones that authenticate against the Zentyal server.