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Acceleware ditches hardware, goes software only

Back in July I wrote about the restructuring on HPC appliance maker Acceleware. Acceleware’s model was to take a piece of ISV code, accelerate key parts of the solution using NVIDIA’s technology (GPUS and CUDA), and then sell the code plus the box to run it on to users. It picked its ISV targets in verticals it understood well, like electronics and oil/gas.

Last week the company announced more changes to its business, and its business model. On the business side, they are in the process of doing a private placement through which they hope to raise about $400,000 to help with funding daily operations; more about that in the press release. On the business model side, they’ve ditched the hardware

As part of a significant strategic re-alignment of its business operations, Acceleware has informed its product channel partners that it is moving to a software-only sales model in 2009 and will not be maintaining equipment inventory for combined sales of hardware and software once existing hardware inventories are used up. …In addition to relying on its existing channel partners, the Company is actively pursuing new channel partners and alternative revenue streams, including professional services agreements with key customers (some of which have already started), with a view to improving financial performance.

The Company has also taken important steps to operationally align itself more closely with NVIDIA, its principal hardware technology provider. Acceleware has made significant progress in introducing NVIDIA’s new hardware programming language (CUDA) in its products and was one of the earliest adopters of NVIDIA’s Tesla GPU computing technology, the latter of which constitutes a vital platform for Acceleware’s software.

I understand why they are doing what they are doing, and if it helps them keep the company afloat then that’s what matters. But I still think the appliance model is a better model for ease of entry into HPC for new customers. Perhaps a hybrid business model where customers can pick which way to go will be offered once (or if) the company is stable again.

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