IBM Announces New Offerings and Development Strategy for Medium-Sized Businesses

First Portfolio of Products and Services Specifically Designed, Developed and Priced for Medium-Sized Customers

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NEW YORK - 25 Jun 2003: IBM today launched the industry's first portfolio of offerings and programs designed and priced specifically for medium-sized business customers, including new software for rapidly building e-commerce sites and a new Linux-based portal solution to enhance office productivity through customized access to business tools and information.

The portfolio will consist of new hardware, software, services, solutions and financing all designed to meet specific criteria for medium-sized businesses with respect to function, ease of use and management, and price -- a set of brand attributes delivered under the name Express. The offerings within the new IBM Express portfolio will assist medium-sized business -- companies with between 100 and 1,000 employees that often have fewer IT skills and tighter budgets than larger enterprises -- in their transformation to on demand businesses using IBM's open standards-based technology.

The new WebSphere Commerce - Express is designed to enable medium-sized companies to create and manage e-commerce sites in fewer steps than the comparable offering from Microsoft, and at a lower price point. The new portal solution combines the power of an eServer xSeries system with the scalability of WebSphere Portal Express, to make it easier for employees to access, customize and manage, in one place, all the business critical knowledge and content-management tools they need to operate efficiently in a busy office environment.

Many medium-sized businesses are looking to improve the efficiency of their core business processes. In fact, in a recent survey conducted by Nielsen ReelResearch on behalf of IBM, over half of small and medium businesses think information technology will be more important in helping their company achieve its business objectives in the next twelve months. Yet the majority of respondents believe that business solutions are still designed, developed and priced for large companies.

The information technology industry tends to design offerings for very large businesses or very small businesses; IBM's Express portfolio is the first to take the needs of medium-sized companies into account to enable these companies to operate in a more responsive, flexible and cost effective manner - in order to better serve customers and grow revenue, reduce inventory levels or to take costs out of their supply chain.

Building on Success in Software
IBM has already launched several Express middleware software products including WebSphere Application Server Express, DB2 Express, and WebSphere Portal Express. DB2 Express for example is priced at $499 for a base server package, with an additional licensing cost of $99 per user, and installs in 15 minutes.

Thousands of IBM Business Partners are already working to deliver Express-based solutions. Texas-based Ascendant Technology built a solution for the Plastic Surgery Center of Hampton Roads, Virginia using IBM WebSphere Portal Express, WebSphere Application Server Express and Lotus SameTime to provide HIPAA-compliant automated patient registration, advanced workflow and collaboration capabilities.

"Without the lower entry point of IBM Express software, we couldn't have created an IBM solution for the Plastic Surgery Center -- we would have had to go to .NET," said Blair Hankins, chief technology officer at Ascendant Technology. "Our medium-sized customers are now discovering that IBM based solutions are within their reach. As a Business Partner focused on small and medium businesses, the design, price and open standards support of IBM Express offerings provide the building blocks Ascendant needs to deliver IBM-based solutions."

According to Dr. Peter Vonu, M.D., F.A.C.S., the Plastic Surgery Center is becoming more of an on demand medical practice because of its new IBM Express based solution. "Our patients appreciate the faster and more private sign-in process. Without any extra burden on our doctors or administrators, we also see about 15 more patients a week, which represents more than $250,000 a year in additional revenue. This solution paid for itself in the first three weeks."

Express Criteria and Marketing Plans
Offerings within the new Express portfolio are developed with input from IBM customers and Business Partners. In order to carry the Express name, the product and service programs and offerings must go through a strict certification process- where they must meet benchmarks for providing best in class ease of use, simple installation and overall ease of ownership.

With the new Express portfolio IBM will further enables its network of 90,000 Business Partners including local VARs, independent software vendors (ISVs), systems integrators and consultants to deliver complete solutions to medium-sized businesses. All Express offerings are Business Partner enabled; meaning that partners can either can sell or recommend IBM Express offerings to their customers and receive lead pass fees or other forms of compensation.

To support the launch of the Express portfolio, IBM has announced an advertising campaign focused on industry trade journals which focus on IBM's Express software. IBM will spend over $200 million in demand generation in 2003 to drive awareness of IBM and Business Partners solutions for medium-sized business customers.

As part of today's announcement IBM is launching the following new Express offerings which are designed and priced specifically for medium-sized businesses:

WebSphere Express Portfolio
IBM adds two new software products to its growing portfolio of Express software solutions. The first, WebSphere Commerce Express is a new software offering designed to make it faster, easier and less expensive for medium-sized businesses to create and manage e-commerce site, allowing businesses to start building an online store in as little as one hour. WebSphere MQ - Express makes it easy to connect a variety of different applications together so businesses can efficiently share critical data across their IT infrastructure. A medium-size business can install WebSphere MQ - Express in just five clicks and can be up and running in as little as 10 minutes

IBM eServer Integrated Platform Express for Employee Workplace
Employee productivity is a key focus for medium-sized companies, the IBM eServer Integrated Platform Express for Employee Workplace is an ideal solution for companies with 100 to 250 employees, and offers express configurations that can be tailored by IBM Business Partners to meet requirements of a variety of important industries such as retail, distribution, health care and banking.

This Linux-based solution combines the power of an IBM eServer xSeries 255 system with the scalability and transactional capability of IBM WebSphere Portal Express. Starting price for the employee workplace solution is $35,000 for 20 users. It's IBM intent to provide support for WebSphere Portal Express for Linux on the POWER architecture, and to deliver an employee workplace solution on both eServer iSeries and eServer pSeries platforms.

Financing For IBM Express Solutions
Financing for IBM Express Solutions includes a low rate financing solution that makes it more affordable for medium-sized businesses to install and upgrade any Express solution sooner for a more immediate return on their information technology investment. The low rate financing solution offers below-market rates to qualified customers giving them an affordable and convenient way to lease their IT solutions with a single contract and periodic invoice.

In addition to the low rate financing solution, Financing for IBM Express Solutions also includes the ValuePlan Lease. ValuePlan Lease provides eligible medium businesses with a short, simple and fast lease contract, giving them streamlined financing on the Express solutions they need. IBM financing solutions are available through IBM representatives or IBM authorized Business Partners.

IBM Personal Computing Division - Express Program
A new program offering ThinkPad notebooks and ThinkCentre desktops from IBM's Personal Computing Division (PCD) will offer quick new ways for medium-sized businesses to buy, install and manage their computer systems. Specific models in the Express program provide these customers with many of the pricing and configuration advantages traditionally offered to larger enterprise customers.

The PCD Express product portfolio combines tailored configurations of ThinkCentre desktops, ThinkPad notebooks and ThinkVision monitors with aggressive price. Leading the industry in lowering customers' total cost of ownership, PC products in the IBM program offer state-of-the-art ThinkVantage Technologies in wireless, security, and manageability, as well as extended battery life and enhanced processing.

Express PC products are available immediately through and IBM Business Partners.

IBM Global Services - Express Solutions for Medium Business
IBM will deliver a range of services including packaged implementation, infrastructure support and managed services designed specifically for medium-sized businesses as part of IBM Global Services Express Portfolio.

Both hosting and fixed-priced implementation services will be offered with a range of mid-market ISV partners, including JD Edwards, SAP and other key IBM alliance partners. The latest example of an IBM Express Services offering is the IBM Wholesale Distribution Solution for SAP. Available in the United States, this fixed-price solution enables medium-sized business to more efficiently participate in their customers supply chains or manage their own. As a fixed-price Express solution, it starts at $300,000 and can be deployed in as few as 10 weeks.

The IBM Global Services Express portfolio includes two offerings which allow medium-sized businesses to have IBM manage their e-business infrastructure. IBM Managed Services - Services Anywhere-Select and IBM Managed Hosting - Infrastructure Solutions with Server Management - Entry are available directly from IBM or through IBM Business Partners. These Express services enable a customer to have IBM manage their servers either at the customer location or in an IBM data center.

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