SpyderWeb: One VAR's Transition Into App Dev

A five-employee application developer in Atlanta, SpyderWeb originally started in 2002 as a solution provider for the SMB market. Two years later, the company's focus has already changed once, with yet another evolution under way.

The first choice SpyderWeb officials made was to abandon its networking appliances after it became clear that most of their functionality was being folded into applications. As industry observers know, the trend toward software has continued to evolve as many non-mission-critical business applications once delivered on shrink-wrapped CDs are starting to be offered as services.

This change has happened quickly; SpyderWeb's software and services revenue split already sits at 50-50, a ratio SpyderWeb president Kimberly West expects to continue growing in favor of services before beginning to plateau about a year from now.

"We recognized that it makes no sense to be in hardware anymore, so we're dropping that line, and customer software development is now about 70 percent of our core competency," she says.

She adds that it's not just her company that has been making these kinds of choices.

"We've noticed that some colleagues -- particularly small technology players and ones that are in sectors like CRM -- are having to make a similar switch from hardware to software," she says. "Customers are becoming more interested in ASP-type models and Web-access applications."

The company's increasing focus on services is owed partly to its status as a longtime Microsoft partner. SpyderWeb's relationship with Redmond has put it in the right place at the right time, as customers who are ramping up on .Net, especially ones in industries such as law and financial services, are seeing the benefits of replacing certain applications with more efficient services.

"The trend is beautiful news for us," she says. "It's enhancing Microsoft's reach because .Net has become such a buzzword, even though a lot of people still don't know what the hell it is, including some people at Microsoft."