Print this article | Return to Article | Return to CFO.com
Simplicity, high performance, and low cost make network appliances increasingly popular.
Doug Bartholomew, CFO IT
November 16, 2005
When was the last time you consulted the owner's manual for your refrigerator or toaster oven? Exactly. Kitchen appliances are both familiar and simple (well, usually). They do their jobs unobtrusively, and they require no tinkering. If only things were that simple in the IT world.
Increasingly, they are. The family of products known as network appliances, which first appeared several years ago, is now finding its way into companies of all sizes. The devices offer an all-in-one solution (hardware and preloaded software) that has been preconfigured to tackle a given function, such as E-mail, security, or data-crunching. For the most part, they will not even accept customization, which may frustrate some customers. Then again, no specially trained consultants are needed to get them to work, nor do you need a super-hip, nocturnal, pizza-munching network administrator to coax them to keep working and play nice with the other computers. In short, network appliances have been manufactured and tuned to accomplish one thing very well, at a relatively low cost and with minimal hand-holding and downtime. Their plug-and-play design allows companies to tap their capabilities almost as soon as the machines are unpacked.
If you need proof that these appliances are hot, consider the success of what may be the highest-profile player in the field: Google. It's currently selling its Google Search Appliance about as fast as Starbucks sells grande frappuccinos. "There are more than 1,500 companies using our search appliances, and we are adding dozens of customers daily," says Matt Glotzbach, product manager for Google Enterprise, in Mountain View, California. "These companies see the search appliance as a sophisticated solution in an easy-to-use form, and they can get it running in literally a couple of hours."
Companies use Google's appliance not to find information on the Web, but to track down data on their internal systems. And just as refrigerators come in a variety of sizes, so too does the Google appliance. The company offers a small model capable of searching through up to 1.5 million documents, an in-between model that can "crawl" (as they say in the search world) up to 5 million documents, and, at the high end, the GB-8008 Google Search Appliance, which can bore through 15 million pieces of information to find that memo or sales presentation that lies buried on the company's network. As if those weren't enough choices, earlier this year the company added the Google Mini, a search appliance tailored to small and midsize businesses. It costs less than $3,000 and can search up to 100,000 documents.
The economics of an appliance appealed to Chris Smith, lead Internet technologist at the Xerox Office Group headquarters, which has a staff of 800 in Wilsonville, Oregon. Sales staff were stymied when they wanted to look up such essentials as product information, rebates, current promotions, and customer notes. There were plenty of products that promised to bring order to bear, but, says Smith, "they were expensive, involved a great deal of IT configuration time and ongoing maintenance, and required us to find a server to host them on. We had a very small budget, and I needed to find an inexpensive solution that didn't require a lot of effort."
The Google appliance was not only cost-effective and low-maintenance, says Smith, but also easy to use. "Everybody is used to the Google interface. We simply put the search box in the corner of a Web page and let the team have at it."
According to Google's Glotzbach, this "black box" approach not only reduces complexity, it also allows customers to maintain ownership of the hardware, software, and data associated with potentially sensitive applications. Appliances sit behind a company's firewall and may provide more security than Web-services software that relies on the Internet for its distribution and operation.
Some appliances have features a client can elect to use or not, and some may be tweaked slightly by the vendor, reseller, or client, but substantive tailoring to a specific company's needs is antithetical to their design. "Appliances are not necessarily better than regular software," says Jon Sakoda, chief technology officer and vice president for products at IMlogic Inc. "When you want to configure an application to meet a company's specific requirements, you generally use a regular packaged software application." Even so, IMlogic's customers are electing to go with the company's appliance for instant messaging, particularly when they are just beginning to experiment with IM, because the appliance is easier to manage, Sakoda says.
Rod Mathews, senior director of strategic marketing at Network Appliance Inc., says certain industries, such as energy exploration, find appliances particularly useful for their needs in the field. "Appliances are attractive to these energy companies because they allow the companies to put storage [the single most common form of appliance] in places where they don't want to send a bunch of storage administrators," he explains.
Security is a major growth market for appliances because it provides a way to unite the many forms of software protection a company may need (everything from antivirus and antispam software to content-filtering and port-blocking programs) onto a single device. Cisco Systems, Juniper Networks, Check Point Software, Celestix Networks, Symantec, and others have made a major push in this area.
Tom Russell, senior director of product marketing and development for security at Cisco, says the all-in-one approach "is very attractive to the small and midsize business market." Symantec says it has sold thousands of appliances, in part by touting the fact that its machines receive fresh patches and security updates automatically through Symantec's LiveUpdate technology.
Infonetics Research says the market for security appliances grew by 30 percent between 2003 and 2004, to $3.7 billion, and will reach $5.5 billion by 2008. In the storage arena, IBM, Sun, EMC, and others continue to roll out a variety of appliances, while smaller companies see plenty of room to innovate. For example, Kazeon Systems recently announced an appliance that can analyze unstructured data such as E-mail and decide where to store it and who will have access to it. The future looks bright for those black boxes.