Contour capitalizing on computers, servers

LAFAYETTE — Contour Systems Group Inc., a manufacturer of high-tech systems that require a language of acronyms to describe the components, is in two hot lines of business that are spiraling upward with market potential: white boxes and servers. The company offers hardware solutions and consulting services to its niche market, high-tech customers in e-commerce and other businesses.

“Our e-commerce customers are principally information service providers (ISPs), applications service providers (ASPs) and businesses that provide co-locater services, ´ said Joe Corlett, president of Contour Systems.

According to Error! Bookmark not defined. in “Anatomy of an ASP”, ISPs are divided into two classes: those that provide access and connectivity services, and those that offer hosting services such as e-mail and Web servers, or applications that create “dynamic, interactive experiences.” The second are ASPs.

Co-locaters are businesses that need servers but can’t afford their own data center equipment and 24-hour staff to support it, so they co-locate at a site and pay a fee to use the facility. Co-location is especially appropriate for high-reliability, mission-critical servers, large computational systems or dedicated systems with special needs.

“The eClipse systems we manufacture are SUN-compatible rackmount servers for Solaris and Linux environments,” Corlett said. “The systems can pack data in a very small space.” Small systems or collections of small systems must be rack-mountable at most co-location sites, but very large systems can be free standing. Contour also manufacturers Intel-based servers for NT/2000 and Linux environments. Typical components used in its systems for e-commerce customers include Intel, SUN Microelectronics and Red Hat, to name a few.

“At present, the number of servers installed represent only 5 percent of what will be installed in five years,” Corlett said, paraphrasing Michael Dell of Dell Computer Corp. in the April 5 issue of Computer Reseller News. “That means the server market place will grow 95 percent in the next five years — that’s huge.”

A second line of business for the S-corporation is its white box systems. “We manufacture our own PCs under the CSG label,” Corlett said. White boxes — non-brand, custom manufactured personal computers and workstations for specific clients — account for more than 41 percent of all personal computers shipped in the United States, according to Independent Data Corporation (IDC), a for-profit research corporation that tracks the information technology industry. White box worldwide market share is even greater, nearly 56 percent of all PCs shipped in 1999, according to IDC.

In addition to personal computers, Contour manufactures workstations for technical environments like engineering that are less than a server and more than a personal computers with high-level graphics.

“Every PC and workstation we manufacture is completely different than the last ones we made,” Corlett said. The decreasing cost of hardware components make it possible to create cost-effective, custom-built systems. Contour’s customers for these one-of-a-kind hardware systems include Storage Technology and the Colorado School of Mines in Golden.

The third line of business for Contour is storage devices, mostly RAIDs, redundant array of inexpensive or independent disks. “Businesses need a lot of redundant backups,” Corlett said. “The backups all stripe each other, that is, they write the same data two or three times.”

Contour is also a value-added reseller (VAR) of network attached storage (NAS). The advantage of NAS is that it off-loads data that in the past was sent to the file server, burdening the server with bits and bytes that eventually had to be moved to another storage device. NAS is online and invisible to the user.

Corlett got into the hardware business in 1989 as a salesperson. The Internet explosion made it possible for him to start his own business-to-business company in 1997 selling products to high-tech companies in e-commerce. The start-up took about $30,000 of Corlett’s own money, then a loan from Heritage Bank a year and a half later. With about 12 employees, Corlett expects to realize three-year sales of between $10 million and $15 million by year end, or more than a million dollars per employee for a 36-month effort.

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