The SMB Fallacy

Ongoing hype about small- to medium-sized businesses (SMBs) is not only annoying, it's misleading. That's what Arun Taneja, founder and president of the Taneja Group consultancy told me today.

"Whoever thought up that classification ought to be shot!" asserted the analyst. "They've done more disservice to the industry than it's possible to imagine."

What folk really mean by SMB, Taneja says, is either a really small business or a medium-sized one and the two are light years apart.

Indeed, on close scrutiny, the SMB moniker has so much give in it that it's bound to snap. In an interview last week, for instance, ExaGrid told me its target customer is an organization that hits the "mid-market to small enterprise," which it measures as having about 300 to 10,000 employees and roughly 500 Gbytes to 40 Tbytes of storage under management.

That's a big gap, but some folk might consider ExaGrid's sizing as a fit for the "M" part of the SMB space. Clearly, though, there's a big difference between the doctor's office down the street and a statewide insurance group.So what is really the value of talking about SMBs? To get at that point requires a look at why people use the term in the first place.

There are usually two reasons users and their suppliers focus on SMBs. First, they're trying to point out, as noted in this newsletter two weeks ago and in other columns and announcements this month, that organizations want to buy smaller versions of larger storage products that aren't merely stripped-down or "dumbed down" versions.

At the same time, it seems folk in organizations of all sizes want products that scale up easily, without requiring them to buy huge amounts of storage before it's actually required. (See Storage Suppliers Push Scaleability Envelope.)

So it's really not the size of the company that's at issue here. It's the ability of a product to do the job in a flexible, modular fashion. Chances are, if you can scale up, you can probably scale down with relative ease, since both require the ability to accommodate a range of organizational needs and applications.

There's merit in marketing to small businesses. But Arun's point is well taken. It may be time for companies to stop talking about "SMBs" so much, especially when the point they're trying to make doesn't really have to do with the size of the company.Have a comment on this story? Please click "Discuss" below. If you'd like to contact Byte and Switch's editors directly, send us a message.