CRN: Over that last few years there has been a fair amount of talk about autonomic computing in the server management area, but very little of that technology seems to be taking hold. Why do you think this is the case?

ITTYCHERIA: The reality is that not many companies today are building data centers and using tools to do autonomic functions. The reason for that is that there’s so much chaos right now so to go from this world of chaos to an autonomic environment is somewhat unrealistic. What people are trying to do is first just have much more visibility and control over what they have by starting to centralizing knowledge and define policies. Basically, they are imposing order and control. The next stage is moving to what we call the notion of service-oriented management, which is being able to manage and align your IT infrastructure and operations to the needs of the business. Then the third phase would be moving to more of a policy-based automation environment, such as a utility computing environment.

CRN: Could you build those tools today?

ITTYCHERIA: Customers don’t want it. We have a prototype of a policy engine. But the reality is that if you don’t have tires on a car, you know, you don’t need a jet engine strapped onto the car. You need tires, you need a wheel, you need brakes and so forth before you go and use a car.

CRN: What kind of momentum are you seeing this space?

ITTYCHERIA: The company was founded in 2001. In the last four years, we’ve grown the business on a compound annual basis of about 175 percent a year. We were basically breakeven last year and today we have about 100 customers across a variety of different vertical industries.

CRN: How big a market opportunity do you think this area represents?

ITTYCHERIA: We think that the market is conservatively at $10 billion. These are IDC numbers, not ours. To get that number, IDC says that there are about 20 million servers in production today, going to about 30 million in about two to three years. If you discount 20 million because they are small shops that will never need a sophisticated solution, then there are 10 million servers. Then you apply a price per server of roughly $1,000 per server. That’s $10 billion. And then if you discount that by 50% again, just to be safe, that’s $5 billion. And you’re seeing it grow at roughly 60 to 70 percent compound annually, so you still see a $10 billion market in a couple of years. The market’s huge.

CRN: When will this market take off?

ITTYCHERIA: This whole notion of change and configuration is going to start getting a lot of buzz this year. Two years ago, the buzz was on utility computing. Then people realized that was still a lot of vapor and not much reality. Then last year, the talk was about patch management because of Microsoft’s security problems. I think the pendulum has kind of found its happy medium now, where the problem is around configuration management for servers. This is probably one of the last places in technology where there’s still a lot of manual process. I think you’re going to see a lot of emphasis and focus on building a lot more automation and the management process of the data center.

CRN: Why is this whole area more important today?

ITTYCHERIA: Ten or 15 years ago, machines were viewed as expensive and people were viewed as cheap. You spent millions of dollars on computing gear and the labor, especially management infrastructure, was the rounding error. Today, it’s actually the reverse. For anyone who has 100 servers or more, the inherent management costs of managing those servers is so high, with the labor that you need to service and support that infrastructure, it makes far more sense to use some automation tools to do that for you, rather than having to do it with just people. And if you do nothing, you’re just going to have to add staff, which we just recognize is just cost prohibitive.

CRN: What is your go-to-market strategy?

ITTYCHERIA: Reach is our biggest problem. We use our partners where appropriate to expand our reach and footprint. Once you get the right person who has this problem, invariably we win a lot of business. Our average deal size is north of $300,000. We have about six or seven partner today and we’re just kind of building out a channel organization. We need a distribution channel that can go out and create demand.