Cisco Announcements and IBM Rumors Foreshadow the Emergence of Holistic Cloud Computing Offerings
Cisco's bold move to enter the server market in mid-March was followed by the equally dramatic news just a couple of days later that IBM was allegedly in talks to acquire Sun. While Cisco's intentions to enter the server market have been rumored for some time, the news that IBM was allegedly in talks to acquire Sun caught many by surprise. Yet what makes both of these moves noteworthy is that they may signal a larger shift away from the traditional segmentation of server, network and storage vendors as it exists now and towards a single vendor providing all hardware and software in order to deliver a more holistic cloud computing offering.
On March 16, 2009, Cisco unleashed a flurry of press releases around its new Unified Computing System (UCS) that included enhanced relationships with many vendors outside of its traditional networking space. Accenture (services), BMC Software (systems management), EMC (storage), Red Hat (Linux operating system) and VMware (virtualization) each were mentioned prominently in separate press announcements. While it may just mean Cisco does not want to be left out of the new virtual data center and is partnering with these companies to remain relevant, it more than likely foreshadows the creation of an emerging business entity that will compete against the likes of HP and IBM.
Evidence of this is the high profile rumor that IBM is in talks to acquire Sun. While Sun has some great intellectual assets, Sun has poorly managed them over the last few years making it ripe for acquisition. Sun's high-end UNIX, storage and tape systems as well as its cloud computing technology have to look appealing to Cisco, especially if they are looking at becoming a single-source cloud computing provider. By IBM moving now and acquiring Sun, IBM shores up its own portfolio, eliminates some competition and puts Cisco at a short-term disadvantage as Cisco seeks to create its own portfolio of products and services that support cloud computing.
But can Cisco deliver a fully functional cloud computing infrastructure just with alliances? Cisco's UCS is a solid concept but delivering a holistic cloud computing infrastructure using just alliances leaves a lot to chance. A recent article in the March 23, 2009 print version of NetworkWorld intimates that part of the reason Cisco jumped into the server blade market in the first place was so it could optimize its server blades for operation within its UCS, something that servers from HP and IBM may not be fully able to do.
The fact that Cisco also has alliances with both IBM and HP make it questionable as to if its alliances with Accenture, BMC, Cisco, EMC, Red Hat, VMware and others are really sustainable in terms of delivering the type of interoperability that Cisco apparently wants its UCS to deliver. Rather, I see Cisco laying the foundation for the creation of a new business entity that competes with IBM and HP.
EMC's Executive VP of Global Marketing and Customer Quality, Frank Hauck, almost said as much in one of the joint EMC-Cisco press releases when he said, "EMC and Cisco share a vision that enterprise IT will eventually evolve towards a private cloud model and both companies are very committed to working together to achieve this." So is this a subtle suggestion that a new single super vendor on the scale of HP and IBM and led by Cisco and EMC is forthcoming? It merits consideration.
I do not see a merger between Cisco and EMC (or others) occurring overnight but it could happen sooner rather than later. In the meantime, IBM, HP and the emerging Cisco-EMC consortium will continue to act independently to develop and/or acquire the needed technologies that fill in specific product gaps that they need to deliver a fully integrated cloud computing infrastructure. For instance, one specific area where they all need some help is in the area of archival storage systems that can deliver cost-effective storage solutions that are manageable, scalable and highly available and reliable. Continuing long term data growth and lengthening data retention needs will drive this segment to rapidly expand and any solution deployed under the cloud computing umbrella will need to have this component.
While some of the storage companies already have some offerings in this space, it is questionable if architectures of current products can scale to meet the needs that enterprises already have. By obtaining an emerging but mature archival storage platforms such as a Permabit's Enterprise Archive system that is based on storage grid architecture, they obtain technology that can more easily and economically scale while they begin to weave it into their broader data center management infrastructure.
What makes companies like Permabit equally attractive is that it owns significant intellectual property that would be attractive to any acquirer and, with its open architecture, enable it to quickly and seamlessly integrate into any cloud computing approach. Obviously, Permabit is just one example but expect acquisitions of companies that offer similar enabling technologies offers as these providers look to fill out and come to market with a full portfolio of cloud computing products and services.
The industry is rapidly digesting what these announcements from Cisco and rumors regarding IBM potentially mean: the creation of new super vendors that are coming to market with a holistic enterprise-level cloud computing solution. In this emerging world, a single vendor will look to provide a single, integrated cloud computing solution that a single vendor delivers and supports. This is being driven by customers who are telling them that their environments are too complex and out of control. As a result, their infrastructures can't scale and are becoming too risky and expensive to operate. In the eyes of executive management, that is unacceptable.
Each of these current and future vendors (HP, IBM and Cisco-EMC-??) will likely each offer their own private cloud configurations to enterprises to help them solve their data center management problems. In fact, this will become the next big enterprise decision, "Which vendor's cloud infrastructure do I want as my enterprise cloud computing infrastructure?"
Many companies recognize that they cannot continue to create and manage their virtualized data center infrastructure as they do now. Instead they will need someone else to help them deliver it. HP, IBM and the emerging Cisco consortium appear to be positioning to assume this new role in data centers and, as they do, expect them to acquire smaller, strategic companies along the way that will enable to deliver on this objective
On March 16, 2009, Cisco unleashed a flurry of press releases around its new Unified Computing System (UCS) that included enhanced relationships with many vendors outside of its traditional networking space. Accenture (services), BMC Software (systems management), EMC (storage), Red Hat (Linux operating system) and VMware (virtualization) each were mentioned prominently in separate press announcements. While it may just mean Cisco does not want to be left out of the new virtual data center and is partnering with these companies to remain relevant, it more than likely foreshadows the creation of an emerging business entity that will compete against the likes of HP and IBM.
Evidence of this is the high profile rumor that IBM is in talks to acquire Sun. While Sun has some great intellectual assets, Sun has poorly managed them over the last few years making it ripe for acquisition. Sun's high-end UNIX, storage and tape systems as well as its cloud computing technology have to look appealing to Cisco, especially if they are looking at becoming a single-source cloud computing provider. By IBM moving now and acquiring Sun, IBM shores up its own portfolio, eliminates some competition and puts Cisco at a short-term disadvantage as Cisco seeks to create its own portfolio of products and services that support cloud computing.
But can Cisco deliver a fully functional cloud computing infrastructure just with alliances? Cisco's UCS is a solid concept but delivering a holistic cloud computing infrastructure using just alliances leaves a lot to chance. A recent article in the March 23, 2009 print version of NetworkWorld intimates that part of the reason Cisco jumped into the server blade market in the first place was so it could optimize its server blades for operation within its UCS, something that servers from HP and IBM may not be fully able to do.
The fact that Cisco also has alliances with both IBM and HP make it questionable as to if its alliances with Accenture, BMC, Cisco, EMC, Red Hat, VMware and others are really sustainable in terms of delivering the type of interoperability that Cisco apparently wants its UCS to deliver. Rather, I see Cisco laying the foundation for the creation of a new business entity that competes with IBM and HP.
EMC's Executive VP of Global Marketing and Customer Quality, Frank Hauck, almost said as much in one of the joint EMC-Cisco press releases when he said, "EMC and Cisco share a vision that enterprise IT will eventually evolve towards a private cloud model and both companies are very committed to working together to achieve this." So is this a subtle suggestion that a new single super vendor on the scale of HP and IBM and led by Cisco and EMC is forthcoming? It merits consideration.
I do not see a merger between Cisco and EMC (or others) occurring overnight but it could happen sooner rather than later. In the meantime, IBM, HP and the emerging Cisco-EMC consortium will continue to act independently to develop and/or acquire the needed technologies that fill in specific product gaps that they need to deliver a fully integrated cloud computing infrastructure. For instance, one specific area where they all need some help is in the area of archival storage systems that can deliver cost-effective storage solutions that are manageable, scalable and highly available and reliable. Continuing long term data growth and lengthening data retention needs will drive this segment to rapidly expand and any solution deployed under the cloud computing umbrella will need to have this component.
While some of the storage companies already have some offerings in this space, it is questionable if architectures of current products can scale to meet the needs that enterprises already have. By obtaining an emerging but mature archival storage platforms such as a Permabit's Enterprise Archive system that is based on storage grid architecture, they obtain technology that can more easily and economically scale while they begin to weave it into their broader data center management infrastructure.
What makes companies like Permabit equally attractive is that it owns significant intellectual property that would be attractive to any acquirer and, with its open architecture, enable it to quickly and seamlessly integrate into any cloud computing approach. Obviously, Permabit is just one example but expect acquisitions of companies that offer similar enabling technologies offers as these providers look to fill out and come to market with a full portfolio of cloud computing products and services.
The industry is rapidly digesting what these announcements from Cisco and rumors regarding IBM potentially mean: the creation of new super vendors that are coming to market with a holistic enterprise-level cloud computing solution. In this emerging world, a single vendor will look to provide a single, integrated cloud computing solution that a single vendor delivers and supports. This is being driven by customers who are telling them that their environments are too complex and out of control. As a result, their infrastructures can't scale and are becoming too risky and expensive to operate. In the eyes of executive management, that is unacceptable.
Each of these current and future vendors (HP, IBM and Cisco-EMC-??) will likely each offer their own private cloud configurations to enterprises to help them solve their data center management problems. In fact, this will become the next big enterprise decision, "Which vendor's cloud infrastructure do I want as my enterprise cloud computing infrastructure?"
Many companies recognize that they cannot continue to create and manage their virtualized data center infrastructure as they do now. Instead they will need someone else to help them deliver it. HP, IBM and the emerging Cisco consortium appear to be positioning to assume this new role in data centers and, as they do, expect them to acquire smaller, strategic companies along the way that will enable to deliver on this objective
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