SMC Drives Down Costs
Many vendors are in a race to release the sexiest, newest technology. SMC Networks cares about capabilities and doesn't mind a little sex appeal, but what it's really concerned about is price. SMC, which targets small to midsize businesses, has a unique approach to keeping prices down: Its parent company, Taiwan-based Accton Technology Corp., makes products for an array of networking vendors. That expertise, and Accton's economies of scale, helps SMC produce a line of solid, cost-effective products. SMC may not be first to market, but it is tough to beat on price.
 Sean Keohane, President, SMC
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SMC didn't always approach the market this way, and that itself is a lesson in survival. In the mid-90s, SMC left the high-end enterprise market by selling that business to Cabletron. The company was also a leader in Ethernet NICs until Intel put the squeeze on.
In 1997, SMC found its savior in Accton and made a push into the market's low end.
The company is focused on three areas: driving down prices, building a brand in the small- to midsize-business market, and pushing new technology, in this case WLANs.
President Sean Keohane says he believes that small and midsize companies have a real need for wireless LANs. "We feel the need being driven by remote-access people coming into the company that don't necessarily have a permanent location. The other issue is the adds, moves and changes that small companies go through as they are growing. They might change buildings in the course of a short-term period," Keohane says.
He hasn't changed his strategy given the tough times, but he is trying to be as flexible as possible. Take VoIP. Customers may be able to save money and gain features, but a VoIP implementation still requires a sizable upfront investment. "We're actually product sampling with the customer. 'Try it, watch your phone bill, see what the effect is so you can make the decision to buy it. I'm not going to ask you to pay up front because you may not believe me,' " Keohane says.
Rivals should be aware that he plans to continue driving down costs. "I think our product life cycles are anywhere from eight to nine months before we reduce the cost without changing the functionality," Keohane says.
Riptech Looks for Trust
Managed security service provider Riptech has no problem convincing IT that security is important. The trick is getting shops to trust companies defining a new space.
Riptech's plan is to spot problems first. Sounds good, but that means investing heavily in R&D, and building more relationships within the security community, says Riptech CEO Amit Yoran, a former U.S. Air Force officer who helped craft the security architecture for the Pentagon's network backbone.
While many service providers face financial problems, especially in the MSSP space, Riptech is raking in the dough, or at least the funding. In October, perhaps the worst time to raise venture capital, the Alexandria, Va., firm snagged $21 million to put into R&D, build sales and perhaps buy a company or two.
The cash backing is nice, but IT managers want to know what Riptech plans to do to stop future attacks. Yoran points to Riptech's track record over the past few months of discovering and fending off vicious hacker attacks.
"We saw Nimba weeks before it was released in the wild; we saw the first signs of it being tested. ... We are able to put our warnings to our customers in advance of postings," Yoran says.
 Amit Yoran, CEO, Riptech
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RipTech doesn't do it all alone. It relies on some 100 security teams with which it shares attack data and prevention techniques. Yoran hopes this level of knowledge will make Riptech a household name in security. That may be Riptech's biggest challenge -- becoming more well known.
"How do we make sure we are on the bidders' list?" Yoran says. "Historically that's been a much more challenging issue for us. Once we get a customer in the door and deliver the service to them, I can almost guarantee that the customer is going to subscribe."
In many ways, Riptech takes things one customer at a time, working off one strong reference account to gain another. Still, as with everyone these days, Riptech is squaring off against tighter IT budgets. That means proving to companies that Riptech can not only do the job, but do it for less money. "I think we can provide better security, faster, at lower costs than organizations can do it in house," Yoran says.
Also, Riptech won't exploit the events of Sept. 11 to gain sales. "We've been careful not to become ambulance chasers. I think there have been almost distasteful statements and marketing campaigns based on Sept. 11," Yoran says. "We have not put together an antiterrorist package for corporate America."
Doug Barney is editor in chief of Network Computing. Send your comments on this article to him at dbarney@nwc.com.
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