How does IBM count?

by Volker Weber

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There will be numbers coming up, and I want to understand them. For instance this one from last year. 12,236 customers. Since when? I believe since Notes 8 shipped. It's actually not net new customers, just new customers. Now let's pull a number out of thin air for this year. It has to be higher, right? So it's unlikely IBM is going to come up with the number since last year. It's probably coming from the same starting point, so that it accumulates like the millions of Notes users. If that number would be 17,236, it would actually mean 5,000 from last year.

Or LotusLive. How do you count that? A user who uses LotusLive iNotes and LotusLive Connections is that one user or two? And when you buy a package with a hundred LotusLive Engage licenses, does that count as 100 users, even if you register only 53? Then IBM acquired the messaging business from Outblaze, and that runs LotusLive iNotes. But it also runs Ovi Mail. Same platform, different branding. Do the other Outblaze mailboxes count as iNotes users? Technically they are, but from a marketing perspective?

I will have lots of questions. :-)

[Photo John Roling]

Comments

And that's why we need those questions asked... as the story behind the numbers is much more interesting (and usually more valid) than the number itself...

Thomas Duffbert Duff, 2010-01-14

There are a lot of creative numbers going round. Take the news of the recent Panasonic Lotus Live win - we are given several numbers to pick from.

380,000 users, 150,000 users, 300,000 users and 100,000 users

Which is it? !

Andy Mell, 2010-01-14

I don't understand the numbers with today's Panasonic announcement.
First I saw 380,000.

Then later I saw 150,000

Curt Stone, 2010-01-14

Plus, Panasonic is a large Notes customer. So it's complicated. Way more complicated than you can fit into one number.

Volker Weber, 2010-01-14

To the best of my knowledge:

The 100,000 number is the number of Exchange licences being migrated.
150,000 is the number of users being moved to LotusLive this year
300/380,000 is the total number of Panasonic/Matsushita employees world-wide

Any which way, its a great win.

As you say, lots of questions to be asked, and bullsh*t to be detected I'm sure.

Stuart McIntyre, 2010-01-14

@Stuart - Agreed that regardless of the number, it's good news. It's a big number.

Curt Stone, 2010-01-14

And we still don't know how IBM counts. :-)

Volker Weber, 2010-01-14

For that matter, and for all the questions that are given to IBM on this issue, we also don't know how Microsoft counts either.

Certainly both companies have to explain themselves, although it seems MS is given a pass on this more often than not.

K.

Kevin Mort, 2010-01-14

The word "customer" relates to companys not users, I think. So in this count 350,000 user in one company (like Panasonic) count as one customer.
Werner

Werner Motzet, 2010-01-14

No, Werner. Panasonic is an existing Notes customer. They don't count towards the "new customer" number. Or they shouldn't, or the number becomes completely useless.

Volker Weber, 2010-01-14

I always roll the eyes when I see any number presented to me. IBM play this sort of game like all the big operators. It would be nice to see an actual qualification of the numbers. I think the era of "phat numbers" is passing rapidly as the chorus of questions about their ambiguity rings louder each year.

If Alistair does the keynote, and quotes a Phat number without qualification I think he will immediately lose street cred and its just more of the same.

One would think on the face of it, a "new" customer means that they didn't have Notes before, and now they have it. I know that there are a range of products not associated to the classic Domino server. But you can extrapolate new job activity with it.

If I can be so bold and take that definition as the meaning of "new", then you can qualify it by looking at the demand for Notes administrators and developers. Technology needs people to run it, and it's a correlation that is as reliable as the theory of gravity. It's not accuarate, but it's a reliable cause-and effect theory.

If there are thousands of new Domino sites, it will follow with a surge in demand for specialists either from BP's/IBM/New jobs.

And I can tell that there are certainly no "new" Lotus customers in Australia.

Giulio Campobassi, 2010-01-14

Giulio,

I agree qualification is needed, and you're right as I mentioned as well, all of the major folks do this, however, what I find funny is how often MS claims are left be (outside of IBM, and specifically Ed Brill) with no one taking them to task. Certainly not the press.

New customers as you mention can be by product and count as a new Lotus customer. If I have a customer with no history in Lotus with Exchange & Outlook today who then rolls Sametime...they're a new Lotus customer.

In the case of Panasonic, they are likely "new" in the sense of product rather than Lotus as a whole. And yes, I agree that's a fine and rather difficult line to expect everyone to tow.

With the product set as it is, the existence of Notes in the account shouldn't be the only metric, but it should be clear when issuing a release.

I am quite certain that when MS issues their annual LS spoiler claiming all manner of wins, few people outside the Yellowverse will question the number. But we all know their math has been less than adequate in the past.

I am not going to expect all of these vendors to really come clean, but one can dream. : )

Kevin Mort, 2010-01-15

I'm not really to into the numbers game, as it lends itself to people who believe in the herd mentality of always trying to be on the winning team. Even quoting large customers as wins is suspect, as large companies are disparate enough that they often have shops that still run competitor products long after their 'migration'.

If you're an existing customer, then are the numbers really meaningful? If you're shopping for a product, it's features that matter, right?

Both sides of the fence fudge their numbers in their favor...it's human nature, and if you don't believe that then we can at least agree that it's the nature of competitive business practices. I think a lot of people have given up on tracking the numbers, they just believe the loudest voice.

In a nutshell, trying to find the source of these numbers is interesting, but fruitless.

Mike McPoyle, 2010-01-15

While some might question Microsoft numbers. I know of many large shop that moved from Domino to Exchange for mail but only of little that moved from Exchange to Domino (if I forget about aquisitions).
To be honest I am only aware of O2 Germany (Viag Interkom) and recently Continental (although this was an aquisition from Siemens) in Germany. This of course does not mean that those do not exist. They just seem to happen silently (or not at all). I don't know. Also if you look at the DominoOrExchange Wiki things don't look that rosy for IBM. At least I would not say that large scale deployments are solely based on IBM Lotus Domino nowadays.
And while Microsoft announces stories that often seem to look more clear I cannot say that for IBM. For example Philips migrates their mail to Exchange as does Glaxo Smith Kline (Exchange Online) and some weeks later IBM says those are great IBM Lotus success stories. I hope that Exchange migrations are not counted as IBM wins yet (although this would certainly boost some figures). And in general IBM press releases list in majority existing Notes customers.
You may ask yourself if this is everything IBM is able to show? Existing customers that renew their contracts or extend their portfolio.
Of course those may have renewed existing licenses, bought Connections or a single SmartSuite license. You don't know because the details are not published.
At the same time for example Bayer announces that 100.000 seats will move from Domino to Exchange starting in 2010. And Bayer really is a big IBM Lotus shop.
Panasonic is a good story although if Panasonic is counted as an Exchange customer that would change some entries in the Wiki again (and not for the positive).

Henning Heinz, 2010-01-15

I think that Mike has something in his comment. IBM Lotus has to show "new customers" to the faithful, the analysts, the critics, so that those that make their living off of IBM Lotus software, and to those decision makers that may be on the fence, that they are "on the winning team."

The number of "new customers" is rather vague. It probably lumps those organizations that installed just one part of the IBM Lotus portfolio in their company, like Sametime or Connections. It may include new installations of Lotus Foundations. And maybe there are some companies that moved to Lotus Notes and Domino. And it could be an existing IBM Lotus customer, that hasn't bought anything in 3-5 years, that recently installed another package from the portfolio.

Finally, IBM Lotus probably shows this number to combat assertions from their competitors, elicit a positive response from the faithful, show that there is still life in the portfolio, and, more importantly, to tell their existing customers that they are "on the winning team." That anyone would ask for a clarification of how that number was compiled may not be happy with the response (if there is one) and the answer may remove some of the mystique surrounding it.

But it would make for a great question. :-)

Gregg Eldred, 2010-01-15

Regarding Bayer AG. I've heard the opposite in 2009: The result of the Exchange migration evaluation was the rejection of this plan. However, MOS will be considered as an plattform, paralell to the Notes mail and collaboration infrastructure.

Marc Egart, 2010-01-15

Related to IBM's Panasonic announcement: IBM Panasonic "Win" = Keeping a Notes Customer.

Panasonic "was already using Notes worldwide, and fewer than 4% of their employees were using Exchange Server – most of them in North America"

Bob Congdon, 2010-01-15

@Marc I hope so. You can read more about it here on vowe.net but I am aware that you did post a comment on that thread too. Unfortunately the story itself, published directly on the Bayer website (and not on Microsoft.com or another unreliable source) is not available anymore.
A new headline that Bayer is not going to migrate to anything anytime soon would be a nice one.

Henning Heinz, 2010-01-15

re Panasonic, Microsoft is spinning when they say "fewer than 4%" -- that assumes all Panasonic employees today have email, which was not the case before the LotusLive decision. The win here is more about getting deployed to their entire enterprise, not just those who had Exchange or Domino already. In that pre-existing population, the ratio of Exchange:Domino users was much higher than 4%.

Ed Brill, 2010-01-16

Microsoft is spinning

That has to be the comment of the century. 4% of 300,000 is 12,000. Is that ROUGHLY the number of Exchange users we are talking about?

And the bigger question: how does IBM count?

Volker Weber, 2010-01-16

You have fallen for the false logic.

Panasonic didn't have 100% of its employees using email in the past. If the data I've seen is right, less than 10% of the 300,000 total workforce had either Exchange or Domino. Exchange had an incumbent presence amongst the pre-existing users.

Anyway, the bigger picture is the 90% of the workforce that wasn't using either -- they'll be using LotusLive, not Exchange (or Exchange Online) or Google. That is why IBM correctly calls this a win.

Ed Brill, 2010-01-16

The main focus of the articles I've read hasn't been the Exchange conversion, it's been the number of users being brought into the cloud.

The articles do mention Exchange (and "other collaborative solutions", e.g. Domino) so there's some spin there to hopefully lead you into thinking that there was some sort of 6-digit Exchange conversion also. I'm sure that wasn't lost on the IBM marketing department.

At the same time MS spins this all as "IBM keeping an existing customer" since there was at least one user using Domino.

But it sounds like:

- 270,000+ users who had nothing went to LotusLive
- 12,000 users who had Exchange went to LotusLive
- some number of Domino users (less than 18,000) went to LotusLive

Any way you spin it, I think this one comes off as a Big Ass Win (tm) for IBM and LotusLive.

Erik Brooks, 2010-01-16

Hey Volker.. this year's number is 18,378..woo hoo..

Giulio Campobassi, 2010-01-19

So where did you find this number?

Volker Weber, 2010-01-19

It was on a sheet in the OGS. It is the number of new customers since the launch of R8 (Photo). Last year it was 12.236 since the launch of Notes 8. IBM also has published their q4 results with another loss for the Lotus division. There are probably a lot of official explanations why Lotus did fall behind other IBM software divisions. We did something wrong probably is not one of those.

Henning Heinz, 2010-01-21

Alright, some clarificationon how IBM counts. Assuming Notes shipped on Aug 17 2007, the 12236 new customers were announced on Jan 19 2009, and the 18378 on Jan 18 2010, we get:


12236 new customers in 521 days, roughly 23,5 new customers a day in 2007 and 2008
6142 (18378 % 12236) new customers in 364 days, roughly 16,9 new customers a day in 2009


This is easier to understand with a small graph:

I also asked whether IBM counts all users on Outblaze, even those not branded iNotes as LotusLive users, and in fact they do. I asked more than one person more than one time, and without a doubt they are lumped in. Ovi Mail alone hit 1 million registered users after six months in August of last year so that is a sizable portion.

Volker Weber, 2010-01-22

I really value your honesty and, indeed, your advocacy for the devil, but do you not kind of play the same game as IBM here in that the numbers presented are autarchic? I think (hope) that we all know these kind of numbers don't really mean anything unless viewed in in the context of a wider (non yellow) universe.

To me it is less than pleasing that sales of Lotus software are down but in other industries hitherto big players are down and out - eg. Chrysler (yeah, I know they were featured in one of the Denis Leary TV ads) and SAAB. Microsoft's quarter 4 might turn out looking (relatively) good in comparison to Lotus but if so it could well be because their marketing has hoodwinked people into believing Windows 6.1.7x is actually Windows 7 rather than the Vista it is (no shame in it being a version of Vista - Windows 6.1.7x is way superior to XP). The drop in sales of Lotus software is pretty trivial in comparison to what the banks did to themselves and what their problems did to others. It is a virtue not to spend money these days!

It would be interesting to see the figures for MS Outlook (full version and Express) and Sharepoint to help contextualise the performance of Lotus.

Ian Scott, 2010-01-23

How does this explain, that the rest of the Software Group is up?

Volker Weber, 2010-01-23

It doesn't explain it. However, I still think it is much more meaningful if we can compare against the figures for similar product groupings in other companies.

I am not making a defence of the Lotus sales figures - it might well be that the figures are even worse than they currently look if compared with Microsoft.

What would be really nice is something analogous to the FT World Index Series that would allow us to compare performance across product groupings and geographic areas.

Ian Scott, 2010-01-23

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