Jeff, I think you are partly right when you say that SMBs need IT products that are built from the ground up for SMBs, not enterprise products that have been scaled down (or dumbed down, some cynics would say). Hey, I touched on this very subject last month while writing about the SMB storage technology.

But I wouldn’t say that big iron vendors find the SMB market to be a mystery. In conversations with vendors and analysts (and end users), I’ve sensed that many companies are aware that their so-called SMB strategies are aimed more at the midmarket than anything else. This seems to be the first stage of the SMB market push for these IT vendors, and these companies often have the complex needs and resources to make use of enterprise products that have been retooled and priced down for them.

Small companies are diverse in their needs and seemingly infinite in their number. Knowing this, vendors like IBM, Oracle, etc., are probably aware that any legitimate small business product they put out will please some, but not all. I think conquering the small business market will take baby steps. It will take time for any vendor to get there. In the meantime, vendors that have always sold to smaller businesses can rest assured that the big players are still finding their way in this market.