Lenovo Buys IBM x86 Server Business

Richard Fichera

Wow, wake up and it’s a whole new world – a central concept of many contemplative belief systems and a daily reality on the computer industry. I woke up this morning to a pleseant New England day with low single-digit temperatures under a brilliant blue sky, and lo and behold, by the time I got to work, along came the news that Lenovo had acquired IBM’s x86 server business, essentially lock, stock and barrel. For IBM the deal is compelling, given that it has decided to move away from the volume hardware manufacturing business, giving them a long-term source for its needed hardware components, much as they did with PCs and other volume hardware in the past. Lenovo gains a world-class server product line for its existing channel organization that vastly expands its enterprise reach, along with about 7,500 engineering, sales and marketing employees who understand the enterprise server business.

What’s Included

The rumors have been circulating for about a year, but the reality is still pretty impressive – for $2.3 Billion in cash and stock, Lenovo acquired all x86 systems line, including the entire rack and blade line, Flex System, blade networking, and the newer NeXtScale and iDataPlex. In addition, Lenovo will have licensed access to many of the surrounding software and hardware components, including SmartCLoud Entry, Storewize, Director, Platform computing, GPFS, etc.

IBM will purchase hardware on an OEM basis to continue to deliver value-added integrated systems such as Pure Application and Pure Data systems.

What IBM Keeps

IBM will keep its mainframe, Power Systems including its Flex System Power systems, and its storage business, and will both retain and expand its service and integration business, as well as provide support for the new Lenovo server offerings.

What Does it Mean for IBM Customers?

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Lenovo Buys IBM x86 Server Business

Richard Fichera

Wow, wake up and it’s a whole new world – a central concept of many contemplative belief systems and a daily reality on the computer industry.  I woke up this morning to a pleseant New England day with low single-digit temperatures under a brilliant blue sky, and lo and behold, by the time I got to work, along came the news that Lenovo had acquired IBM’s x86 server business, essentially lock, stock and barrel. For IBM the deal is compelling, given that it has decided to move away from the volume hardware manufacturing business, giving them a long-term source for its needed hardware components, much as they did with PCs and other volume hardware in the past. Lenovo gains a world-class server product line for its existing channel organization that vastly expands its enterprise reach, along with about 7,500 engineering, sales and marketing employees who understand the enterprise server business.

What’s Included

The rumors have been circulating for about a year, but the reality is still pretty impressive – for $2.3 Billion in cash and stock, Lenovo acquired all x86 systems line, including the entire rack and blade line, Flex System, blade networking, and the newer NeXtScale and iDataPlex. In addition, Lenovo will have licensed access to many of the surrounding software and hardware components, including SmartCLoud Entry, Storewize, Director, Platform computing, GPFS, etc.

IBM will purchase hardware on an OEM basis to continue to deliver value-added integrated systems such as Pure Application and Pure Data systems.

What IBM Keeps

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IBM Raises The Bar On Converged Infrastructure With PureFlex And PureApplication Integrated Offerings

Richard Fichera

IBM Jumps On CI With Both Feet

Over the last couple of years, IBM, despite having a rich internal technology ecosystem and a number of competitive blade and CI offerings, has not had a comprehensive integrated offering to challenge HP’s CloudSystem Matrix and Cisco’s UCS. This past week IBM effectively silenced its critics and jumped to the head of the CI queue with the announcement of two products, PureFlex and PureApplication, the results of a massive multi-year engineering investment in blade hardware, systems management, networking, and storage integration. Based on a new modular blade architecture and new management architecture, the two products are really more of a continuum of a product defined by the level of software rather than two separate technology offerings.

PureFlex is the base product, consisting of the new hardware (which despite having the same number of blades as the existing HS blade products, is in fact a totally new piece of hardware), which integrates both BNT-based networking as well as a new object-based management architecture which can manage up to four chassis and provide a powerful setoff optimization, installation, and self-diagnostic functions for the hardware and software stack up to and including the OS images and VMs. In addition IBM appears to have integrated the complete suite of Open Fabric Manager and Virtual Fabric for remapping MAC/WWN UIDs and managing VM networking connections, and storage integration via the embedded V7000 storage unit, which serves as both a storage pool and an aggregation point for virtualizing external storage. The laundry list of features and functions is too long to itemize here, but PureFlex, especially with its hypervisor-neutrality and IBM’s Cloud FastStart option, is a complete platform for an enterprise private cloud or a horizontal VM compute farm, however you choose to label a shared VM utility.

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Dell World – New Image. New Company?

Richard Fichera

I just spent several days at Dell World, and came away with the impression of a company that is really trying to change its image. Old Dell was boxes, discounts and low cost supply chain. New Dell is applications, solution, cloud (now there’s a surprise!) and investments in software and integration. OK, good image, but what’s the reality? All in all, I think they are telling the truth about their intentions, and their investments continue to be aligned with these intentions.

As I wrote about a year ago, Dell seems to be intent on climbing up the enterprise food chain. It’s investment in several major acquisitions, including Perot Systems for services and a string of advanced storage, network and virtual infrastructure solution providers has kept the momentum going, and the products have been following to market. At the same time I see solid signs of continued investment in underlying hardware, and their status as he #1 x86 server vendor in N. America and #2 World-Wide remains an indication of their ongoing success in their traditional niches. While Dell is not a household name in vertical solutions, they have competent offerings in health care, education and trading, and several of the initiatives I mentioned last year are definitely further along and more mature, including continued refinement of their VIS offerings and deep integration of their much-improved DRAC systems management software into mainstream management consoles from VMware and Microsoft.

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HP And Cisco Bury The Hatchet To Accommodate Customers – Everyone Wins?

Richard Fichera

In a surprising move, HP and Cisco announced that HP will be reselling a custom-developed Cisco Nexus switch, the “Cisco Nexus B22 Fabric Extender for HP,” commonly called a FEX in Cisco speak. What is surprising about this is that the FEX is a key component of Cisco’s Nexus switch technology as well as an integral component of Cisco’s UCS server product, the introduction of which has pitted the two companies in direct and bitter competition in the heart of HP’s previously sacrosanct server segment. Combined with HP’s increasing focus on networking, the companies have not been the best of buds for the past couple of years. Accordingly, this announcement really makes us sit up and take notice.

So what drove this seeming rapprochement? The coined word “coopetition” lacks the flavor of the German “Realpolitik,” but the essence is the same – both sides profit from accommodating a real demand from customers for Cisco network technology in HP BladeSystem servers. And like the best of deals, both sides walk away thinking that they got the best of the other. HP answers the demands of what is probably a sizable fraction of their customer base for better interoperability with Cisco Nexus-based networks, and in doing so expects to head off customer defections to Cisco UCS servers. Cisco gets both money (the B22 starts at around $10,000 per module and most HP BladeSystem customers who use it will probably buy at least two per enclosure, so making a rough guess at OEM pricing, Cisco is going to make as much as $8,000 to $10,000 per chassis from HP BladeSystems that use the B22) from the sale of the Cisco-branded modules as well as exposure of Cisco technology to HP customers, with the hope that they will consider UCS for future requirements.

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Intel Developer Forum (IDF) - Cloud. And Cloud, Cloud, Cloud. Oh, Yes, Did I Mention “Cloud”?

Richard Fichera

I just attended IDF and I’ve got to say, Intel has certainly gotten the cloud message. Almost everything is centered on clouds, from the high-concept keynotes to the presentations on low-level infrastructure, although if you dug deep enough there was content for general old-fashioned data center and I&O professionals. Some highlights:

Chips and processors and low-level hardware

Intel is, after all, a semiconductor foundry, and despite their expertise in design, their true core competitive advantage is their foundry operations – even their competitors grudgingly acknowledge that they can manufacture semiconductors better than anyone else on the planet. As a consequence, showing off new designs and processes is always front and center at IDF, and this year was no exception. Last year it was Sandy Bridge, the 22nm shrink of the 32nm Westmere (although Sandy Bridge also incorporated some significant design improvements). This year it was Ivy Bridge, the 22nm “tick” of the Intel “tick-tock” design cycle. Ivy Bridge is the new 22nm architecture and seems to have inherited Intel’s recent focus on power efficiency, with major improvements beyond the already solid advantages of their 22nm process, including deeper P-States and the ability to actually shut down parts of the chip when it is idle. While they did not discuss the server variants in any detail, the desktop versions will get an entirely new integrated graphics processor which they are obviously hoping will blunt AMD’s resurgence in client systems. On the server side, if I were to guess, I would guess more cores and larger caches, along with increased support for virtualization of I/O beyond what they currently have.

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