Shifting Sands – Changing Alliances Underscore the Dynamism of the Infrastructure Systems Market

Richard Fichera

There is always a tendency to regard the major players in large markets as being a static background against which the froth of smaller companies and the rapid dance of customer innovation plays out. But if we turn our lens toward the major server vendors (who are now also storage and networking as well as software vendors), we see that the relatively flat industry revenues hide almost continuous churn. Turn back the clock slightly more than five years ago, and the market was dominated by three vendors, HP, Dell and IBM. In slightly more than five years, IBM has divested itself of highest velocity portion of its server business, Dell is no longer a public company, Lenovo is now a major player in servers, Cisco has come out of nowhere to mount a serious challenge in the x86 server segment, and HP has announced that it intends to split itself into two companies.

And it hasn’t stopped. Two recent events, the fracturing of the VCE consortium and the formerly unthinkable hook-up of IBM and Cisco illustrate the urgency with which existing players are seeking differential advantage, and reinforce our contention that the whole segment of converged and integrated infrastructure remains one of the active and profitable segments of the industry.

EMC’s recent acquisition of Cisco’s interest in VCE effectively acknowledged what most customers have been telling us for a long time – that VCE had become essentially an EMC-driven sales vehicle to sell storage, supported by VMware (owned by EMC) and Cisco as a systems platform. EMC’s purchase of Cisco’s interest also tacitly acknowledges two underlying tensions in the converged infrastructure space:

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Welcome to the I&O Transformation Playbook.

Jean-Pierre Garbani

To complement the brilliant introduction to the “Infrastructure Transformation Playbook for 2015” by my friend Glenn O’Donnell, the operation’s analyst team, the “O” in I&O, would like to welcome you to the “Infrastructure And Operations Transformation Playbook for 2015”.

In this playbook, we do not predict the future of technology but we try to understand how, in the age of the customer, I&O must transform to support businesses by accelerating the speed of service delivery, enabling capacity when and where needed and improving customers and employee experience.

All industries mature towards commoditization and abstraction of the underlying technology because knowledge and expertise are cumulative. Our industry will follow an identical trajectory that will result in ubiquitous and easier to implement, manage and change technology.

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Introducing Forrester’s Infrastructure Transformation Playbook

Glenn O'Donnell

Forrester’s Infrastructure and Operations research team has been on the leading edge of infrastructure technology and its proper operational aspects for years. We pushed the industry on both the supply side (vendors) and the demand side (enterprises) toward new models and we pushed hard. I’m proud to say we’ve been instrumental in changing the world of infrastructure and we’re about to change it again!

As the entire technology management profession evolves into the Age of the Customer, the whole notion of infrastructure is morphing in dramatic ways. The long-criticized silos are finally collapsing, cloud computing quickly became mainstream, and you now face a dizzying variety of infrastructure options. Some are outside your traditional borders – like new outsourcing, hosting and colocation services as well as too many cloud forms to count. Some remain inside and will for years to come. More of these options will come from the outside though, and even those “legacy” technologies remaining inside will be created and managed differently.

Your future lies not in managing pockets of infrastructure, but in how you assemble the many options into the services your customers needs. Our profession has been locally brilliant, but globally stupid. We’re now helping you become globally brilliant. We call this service design, a much broader design philosophy rooted in systems thinking. The new approach packages technology into a finished “product” that is much more relevant and useful than any of the parts alone.

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Keep An Eye On Software-Defined Data Centers In China

Frank Liu

Although emerging markets like China tend to lag developed markets by 18 to 24 months in terms of technology deployment, Chinese organizations should start embracing new concepts like the software-defined data center (SDDC). The SDDC is an evolving architectural and operational philosophy, not a product you can buy with a demonstrable ROI. Chinese organizations can’t risk ignoring SDDC and falling behind global companies — so they need to pay attention to it, for a few reasons:

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VMworld – Reflections on a Transformational Event

Richard Fichera

A group of us just published an analysis of VMworld (Breaking Down VMworld), and I thought I’d take this opportunity to add some additional color to the analysis. The report is an excellent synthesis of our analysis, the work of a talented team of collaborators with my two cents thrown in as well, but I wanted to emphasize a few additional impressions, primarily around storage, converged infrastructure, and the  overall tone of the show.

First, storage. If they ever need a new name for the show, they might consider “StorageWorld” – it seemed to me that just about every other booth on the show floor was about storage. Cloud storage, flash storage, hybrid storage, cheap storage, smart storage, object storage … you get the picture.[i] Reading about the hyper-growth of storage and the criticality of storage management to the overall operation of a virtualized environment does not drive the concept home in quite the same way as seeing 1000s of show attendees thronging the booths of the storage vendors, large and small, for days on end. Another leading indicator, IMHO, was the “edge of the show” booths, the cheaper booths on the edge of the floor, where smaller startups congregate, which was also well populated with new and small storage vendors – there is certainly no shortage of ambition and vision in the storage technology pipeline for the next few years.

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Chinese Tech Management Pros: Start Looking Closely At Domestic IT Vendors

Frank Liu

Several events over the past few months in China will affect both the IT procurement strategy of Chinese organizations and the market position and development of local and foreign IT vendors, including:

  • A government-led push away from foreign IT vendors. Amid security concerns, the Chinese government has issued policies to discourage the use of technology from foreign IT vendors. As a result, many IT and business decision-makers at state-owned enterprises (SOEs) and government agencies have put their IT infrastructure plans — most of which involved products and solutions from foreign IT vendors — on hold. They’ve also begun to consider replacing some of their existing technology, such as servers and storage, with equivalents from domestic vendors. This is significant given that government agencies and SOEs are the key IT spenders in China.
  • A trend to get rid of IBM, Oracle, and EMC. Alibaba was an early mover, replacing its IBM Unix servers, Oracle databases, and EMC storage with x86 servers, open source databases like MySQL and MongoDB, and PCIe flash storage. This has evolved into replacing these foreign products and solutions with ones from local Chinese vendors. For example, Inspur launched the I2I project to stimulate customers to drop IBM Unix servers in favor of Inspur Linux servers to support business development. The Postal Savings Bank of China, China Construction Bank, and many city commercial banks have started deploying Inspur servers in their data centers. However, this only affects the x86 server and storage product market: While domestic vendors can provide x86 servers and storage, they still have no databases to replace Oracle’s.
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Decoding Huawei – Emergence as a Major IT Player Looms

Richard Fichera

Last month I attended Huawei’s annual Global Analyst Summit, for the requisite several days of mass presentations, executive meetings and tours that typically constitute such an event. Underneath my veneer of blasé cynicism, I was actually quite intrigued, since I really knew very little about Huawei. And what I did know was tainted by popular and persistent negatives – they were the ones who supposedly copied Cisco’s IP to get into the network business, and, until we got better acquainted with our own Federal Government’s little shenanigans, Huawei was the big bad boogie man who was going to spy on us with every piece of network equipment they installed.

Reality was quite a bit different. Ancient disputes about IP aside, I found a $40B technology powerhouse who is probably the least-known and understood company of its size in the world, and one which appears poised to pose major challenges to incumbents in several areas, including mainstream enterprise IT.

So you don’t know Huawei

First, some basics. Huawei’s 2013 revenue was $39.5 Billion, which puts it right up there with some much better-known names such as Lenovo, Oracle, Dell and Cisco.

 

% Revenue / $ revenue (Billions)

Annual Growth rate

Telco & network equipment

70 / $27.7

7%

Consumer (mobile devices)

24 / $9.5

18%

Enterprise business (servers, storage, software)

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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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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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IBM is First Mover with Disruptive Flash Memory Technology on New x6 Servers

Richard Fichera

This week, IBM announced its new line of x86 servers, and included among the usual incremental product improvements is a performance game-changer called eXFlash. eXFlash is the first commercially available implantation of the MCS architecture announced last year by Diablo Technologies. The MCS architecture, and IBM’s eXFlash offering in particular, allows flash memory to be embedded on the system as close to the CPU as main memory, with latencies substantially lower than any other available flash options, offering better performance at a lower solution cost than other embedded flash solutions. Key aspects of the announcement include:

■  Flash DIMMs offer scalable high performance. Write latency (a critical metric) for IBM eXFlash will be in the 5 to 10 microsecond range, whereas best-of-breed competing mezzanine card and PCIe flash can only offer 15 to 20 microseconds (and external flash storage is slower still). Additionally, since the DIMMs are directly attached to the memory controller, flash I/O does not compete with other I/O on the system I/O hub and PCIe subsystem, improving overall system performance for heavily-loaded systems. Additional benefits include linear performance scalability as the number of DIMMs increase and optional built-in hardware mirroring of DIMM pairs.

■  eXFlash DIMMs are compatible with current software. Part of the magic of MCS flash is that it appears to the OS as a standard block-mode device, so all existing block-mode software will work, including applications, caching and tiering or general storage management software. For IBM users, compatibility with IBM’s storage management and FlashCache Storage Accelerator solutions is guaranteed. Other vendors will face zero to low effort in qualifying their solutions.

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