Parallels: Windows-on-Mac Guys Say Small-Biz Software is Sexy
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where four or five huge companies have their own universes of hardware, software, and infrastructure offerings, running from simple consumer devices all the way up to major enterprise-scale cloud computing services.
The idea, Steen says, is to be the company that helps individual users break out of those walled gardens when they want to—serving as the bridge for the wars between Microsoft, Apple, Google, Facebook, and Amazon.
“The more you get these integrated stacks of IT, the more you will find that there are demanding users who will say, ‘I don’t want that. I actually happen to like two or three programs that don’t exist in this platform. I want to access my photos that sit on one of the clouds while I’m listening to my music from the other cloud,’” Steen says. “The world where that service is no longer needed is the world where someone just has won, and there’s only one. And that world is not going to be here for a long time to come.”
So that’s the consumer side of Parallels—helping users break out of the tech giants’ digital fortresses. On the business-software side, the company is doing somewhat of the opposite: bringing order to fragmentation.
Steen says that despite the quickly growing market for cloud-based software and computing, small and medium-sized businesses have trouble getting an all-in-one service that fits their needs. He saw this up close in his previous job, which was heading up small and medium-sized business services for Microsoft.
“Small-business IT is this fascinating and incredibly ignored subject, whether it be by news media or IT analysts or equity analysts or IT vendors, for that matter,” Steen says. “I was head of SMB at Microsoft and certainly, it was the least prioritized, if you will. It’s actually gotten a lot better now, but it was a piece of the customer base that was kind of just there. There was very little actually done for them.”
A funny part of this equation is the fact that serving consumers and serving huge businesses is actually quite similar if you’re a big tech company. The typical individual user needs a pretty common, basic set of stuff: A chunk of hardware kitted out with word processing, e-mail, calendars, music and video players, photo software, and Web browsing—maybe even spreadsheets! And a huge enterprise IT department will need servers, databases, and line-of-business applications. Those needs can be handled by one supplier, too.
The people in the middle are a completely different story. Take your typical coffee shop in Seattle, Steen says—they’ve got a website that’s probably hosted locally, might use Quickbooks for their accounting, Excel for inventory and employee scheduling, and so on. They probably have a couple of PCs and a couple of Macs running it all.
“Go and look at the similar-sized business doing the same thing in New Delhi, and you’ll find a very different IT setup. They’ll probably have a couple of mobile phones—that’ll be their setup.” And it gets vastly more complicated as the business gets slightly bigger, and as you look at different industries, like a law firm or accountant or bookseller.
Most of these people are served by a local reseller of IT services—people who used to be called “web hosters,” Steen says, but are now able to offer a fuller collection of online software services and cloud computing.
Parallels’ goal is to be the platform that helps those local resellers offer everything their clients might want, and do it on a global scale. So a law firm in a growing country like Brazil might come to the local provider for web hosting, e-mail, spreadsheets, and calendars. But over time, the provider really succeeds if it can also offer quirky, industry-specific software services, like research applications, forensics databases, and court records.
This wasn’t quite as possible, of course, before the relatively recent rise of online-based software and commodity cloud services. But Parallels now sees a clear path to capitalize on those mega-trends and aggregate all of the small-business customers that the big IT players have left behind, just as the developing world starts getting supercharged with cheap technology. The overall market, Steen says, is some 150 million small businesses worldwide, consuming about $1 trillion a year in IT and telecommunications services—”the backbone of the global economy.”
“There’s no one who’s doing this. That’s kind of famous last words, but there’s no one who’s taking this end-to-end approach,” Steen says. “There are competitors who build all the pieces you need to build a system. But there is no one who does this soup-to-nuts platform. Literally, if you wanted to start a cloud-services business tomorrow, you could go … rent a couple of servers, buy our stack, and start. You do not need any more software. And there’s no one who does that.”