Cloud Head

Who’s actually spending on cloud computing?

July 27th, 2010

By Carl Brooks, Technology Writer

26 Jul 2010 | SearchCloudComputing.com

While cloud computing continues to gather steam, thanks to the established, money-making efforts of Amazon Web Services (AWS) and Rackspace, much attention has turned to the lucrative enterprise IT market as the next battleground for software vendors. Companies are focusing on building and maintaining private clouds: internal IT environments that operate and deliver services like Amazon’s Elastic Compute Cloud (EC2). But is that where the money is?

Credible signs point elsewhere, as the hosting and service provider market appears to be the real opportunity in cloud computing at the moment. Now that the definitions of what is and isn’t cloud computing have been largely settled, hosting firms and some cloud software vendors are forgoing the elusive enterprise data center customer and quietly using cloud to make money instead.

“We have literally hundreds of customers every month signing up for cloud,” said Peter Sexton, COO of GigeNET, an established managed hosting provider based in Chicago. Sexton said GigeNET had no shortage of customers for its regular hosting and colocation offerings, but many of those same customers were clamoring for on-demand and pay-as-you-go hosting.

Sexton said that GigeNET had developed the platform to run its cloud computing offering completely in-house. Based on Xen and built out on a cluster of new servers and gear that GigeNET designed itself, he said it was an unqualified success for the investment.

Cloud providers aim at service providers

Some cloud providers, like OpSource, are explicitly switching focus from selling clouds to individual businesses and targeting service providers for partnerships instead. OpSource has enjoyed some success with its cloud services, but CEO Treb Ryan said the end-user cloud customer market was basically saturated, and its original managed hosting customers (primarily Software as a Service (SaaS) vendors) were the ones they saw coming onboard.

Ryan said the demand for cloud among hosters and service providers was crystal clear. Every cent they made was based on adding value (in the form of services or capabilities) on top of delivering computing power, and the higher the margin between operational costs and revenue, the more money they made. Ryan said the one thing cloud computing excelled at was driving operational efficiency and lowering costs.

So much so, in fact, that Ryan said OpSource can afford to offer partners steep discounts on its “retail” cloud rates and still make money itself, because its own margins on operating costs are so high. Ryan wouldn’t give specific details, but said even charging $0.04 per hour left “very comfortable margins.”

Cloud offerings of all shapes and sizes

OpSource highlights the intersection between hosting, cloud and SaaS, but what’s more telling is the prevalence of cloud offerings. Every major hosting provider has a cloud product line, with a variety of offerings that sometimes stretch far from the canonical example set by AWS but are still recognizable as cloud computing. An overwhelming majority of small and medium hosters have plans to or are starting to offer cloud services, simply because there is money to be made immediately.

“$20 million to $100 million [revenue] range,” said Reuven Cohen, CEO of cloud platform software company Enomaly. “That’s the market, and these guys win because they’re on the ground in their area.”

Cohen said he has been targeting hosting providers for some time now, because they have a natural appetite for cloud computing and because the private cloud market is ill-defined and largely obscure when it comes to streamlining enterprise IT.

“You hear about this supposedly private cloud market, but in reality, most virtualization vendors have rebranded their products as cloud,” he said, dismissing the notion of radical transformations within enterprise data centers.

We have literally hundreds of customers every month signing up for cloud. Peter Sexton, COO of GigeNET

He said that’s coming, but it’s years away; at the moment, things are completely focused around either buying SaaS products and outsourcing or application virtualization. Cohen’s firm operates without venture capital backing, so he has a vested interest in making sales to whomever is buying, and he noted that Enomaly is in the black.

He also said there was a lack of maturity in enterprise-class cloud infrastructure products at the moment, whereas setting up and selling compute infrastructure or storage clouds was a natural evolution of managed hosting and virtualization. Providers were already out in front on both virtualization and selling IT services, so they are the obvious choice for cloud computing systems as well, according to Cohen.

Enomaly has an extensive list of service provider customers to prove his point. Virtualization vendor Parallels recently announced, like OpSource, that it was going to focus on selling to service providers. It claims it helps more than 5,000 service providers deliver services.

Cloud computing’s first wave was around users with elastic, short-term needs, like startups; virtual lab and test and development users; or apps already “in the cloud,” like Web-only businesses, content distribution and social media websites. The current wave of adoption by hosters seems to fall right in line with an expanding market, and the holy grail of enterprise clouds seems further off than ever.

Read more here.

Tags: business model, cloud, cloud computing, virtualization
No Comments »
Posted by mgrollman Permalink |

Adopting a private cloud strategy – 4 Steps

June 15th, 2010

CLOUD STRATEGY

Adopting a private cloud strategy

Lynn Haber, Contributor, searchcloudcomputing.com

06.11.2010

Many of us have heard the hype about reaping the benefits of public cloud infrastructures without compromising service levels, security or compliance requirements — it’s called private cloud computing. But when is it the right time for companies to pull the trigger on private cloud without shooting themselves in the foot?

Some industry experts say it’s now. They’re quick to caution decision-makers, however, that private cloud is a journey, not a destination.

“Private cloud computing isn’t something you simply go out and buy; it’s an evolution from what we have today,” said Tom Bittman, vice president at Gartner.

Furthermore, he adds that the private cloud is a stopgap or stepping stone to utilizing more mature public cloud services when they become available, any time from six months to ten years from now.

Think of private cloud as a new item in the IT toolkit for different economics. Private cloud computing goes beyond virtualization and includes automated workload management, self-service interfaces and some form of usage metering or chargeback. Private cloud computing also requires the ability to share resources to maximize utilization — among business units, divisions and other groups that may not share resources today — a change that will affect existing corporate culture, politics, processes and even business relationships.

What is private cloud, and when can I have it?

Forrester defines an internal cloud as a multi-tenant, dynamically provisioned and optimized infrastructure with self-service developer deployment, hosted within the safe confines of the enterprise data center.

Forget about getting started with a big bang. Think of adopting a private cloud strategy as a series of steps that requires that the organization to have the technical pieces in place for private cloud computing and be experientially and culturally ready. “If a company isn’t ready, they can’t reap the benefits,” said James Staten, analyst at Forrester Research.

Taking a more somber tone, Randy Bias, CEO of Cloudscaling.com, a cloud engineering services firm that has designed, built and managed large and complex public and private clouds, said that most organizations don’t have the DNA, organizational structure or business incentive to be successful at building a private cloud.

“I think that over the next several years, we’re going to see a lot of attempts with the private cloud that will result in failure and misery,” he said.

That said, he strongly advises companies working on private cloud initiatives to go into it with their eyes wide open. “Whatever you’re building, see it as a short-term goal, not an end goal,” he said.

A recent survey of Gartner clients found that 75% of companies expect to pursue private cloud by 2012.

The four stages of private cloud preparation

Every organization considering the private cloud is destined to travel on a maturity journey that industry experts agree consists of a number of stages, from laying the IT infrastructure groundwork to assessing early scenarios for private cloud deployments.

All agree the initial step, IT virtualization maturity, is the essence of evolving to the private cloud. Forrester’s Staten outlines four stages of virtualization maturity — acclimation, strategic consolidation, optimization, and automation — to assess where your organization is in the process.

The first stage, acclimation, is the time it takes for an organization to learn about virtualization, how it works, test it against simple applications, and then determine where it can safely be applied.

A company is in stage two, strategic consolidation, when its comfort level with virtualization shifts from concept to strategic implementation, having recognized the value proposition of virtualization as an agent of cost savings and change. “At this point the case has to be made for why a workload should not be virtualized,” said Staten.

Stage three, optimization, is when virtualization empowers process improvement and organizations get serious about life-cycle management of virtual machines and cleaning up virtual server sprawl. It’s at this stage where there must be an experiential shift in thinking about the IT infrastructure. “Thinking in the physical world will hurt you in the virtual world,” said Staten.

Companies at stage four of virtualization maturity sit at the precipice of being cloud-ready. These organizations grasp the importance of policy-based automation of the virtualization pool, which, explains Staten, pushes the organization to share services and treat the virtualization pool as an internal cloud service.

Set the stage for your cloud

Inherent in the four steps to virtualization maturity are key elements that set the stage for private cloud computing; namely, a willingness to change the organization and internal processes and gain the political clout to overcome resistance.

Companies who are grounded in stage three are ready to create a greenfield project for private cloud. Experts recommend test and development workloads as a safe place for organizations get their feet wet with private cloud. “It’s a good proving ground and learning ground,” said Fausto Bernadini, director of IT cloud portfolio services at IBM. Additionally, a greenfield project of non-critical workloads at stage three can help accelerate an organization to stage four.

Private cloud return on investment (ROI) evolves alongside this virtualization maturity path. Ultimately, ROI comes from high utilization of the resources that are dedicated to the private cloud. “The higher the sustained utility of the private cloud, the better the payback,” said Staten.

Digging a bit deeper, companies venturing into the private cloud can expect to make big investments in people and processes, as well as new automation and policy enforcement tools.

Unlike the public cloud, where companies can grow and shrink usage (and ultimately costs) based on need, internal private cloud costs are perpetual.

Read more here.

Lynn Haber reports on business and technology from Norwell, MA.

Tags: cloud, cloud computing, desktop virtualization, Michael Grollman, private, private cloud, security, virtualization
No Comments »
Posted by mgrollman Permalink |

New Disruptor Cloud.com Builds OSS Cloud Computing Bridge

May 5th, 2010

May 5, 2010
By Amy Newman of serverwatch.com

Can the cloud itself be open source? Cloud.com (formerly VMOps), which came out of stealth mode with the name not only believes so, it is also basing its business around it.

On Wednesday, the company unveiled a new release of its cloud computing infrastructure management software CloudStack in two commercial and one open source editions. The open source and commercial versions are functionally the same, CMO Peder Ulander told ServerWatch. However the CloudStack Community Edition cannot be used used for anything involving monetization because the the billing system and other components necessary to make money with it come from third parties, Ulander explained. A whopping 98 percent of CloudStack is from software licensed under the GPL. Ulander said that although a cloud can be run off of the Community Edition, making it ideal for putting the software through the paces before taking it into a production environment.

So what is CloudStacks? Ulander described its function as “bridging the private cloud to the public cloud.” He is quick to note that “we build software; we’re not hosting a service,” despite the company’s description of it as infrastructure as a service (IaaS).

The software seeks to combine computing, networking and storage infrastructure in a data center into a single shared resource pool deployable to multiple users as a service. Unlike other cloud offerings, CloudStack integrates with a data center’s current infrastructure, thus not requiring any investment in new hardware.

The CloudStack technology, available in enterprise and service provider editions in addition to the open source version, sits on top of the Xen or KVM hypervisor to offer service management, user management, an image repository, a developer API and more. It then integrates its user interface and approach with existing management tools and common cloud frameworks like the Amazon Web Services API, Citrix Cloud Center (C3) and VMware’s vCloud initiative.

Among the many other benefits CloudStack claims to offer is a secure environment; more comprehensive service management with regard to defining, metering, deploying and managing services to be consumed within a cloud; automated resource distribution; real-time visibility and reporting capabilities; and simplified management.

While Clod.com aims for simplicity, it is not the only vendor looking to bridge to the cloud.

Red Hat, for example, last week unveiled a program it is calling Red Hat Cloud Access. The program enables current Red Hat Enterprise Linux subscribers to leverage their existing support subscriptions for cloud deployments. While Red Hat’s goal is also to simplify, its approach is is different and both clunkier and more limiting than CloudStack’s. Its also only for Red Hat customers. After all, the Linux, and now virtualization vendor, now has a horse in this race.

As InternetNews.com reports, “With Red Hat Cloud Access, enterprises that have Red Hat Enterprise Linux premium subscriptions can move them to Amazon’s EC2 cloud. As a result, Red Hat is enabling its customers to migrate to the cloud with their existing subscriptions. Red Hat is also now set to ensure that the Amazon images of its Red Hat Enterprise Linux are consistent with the version updates that enterprises deploy on-premises.”

The buzz around cloud computing is growing ever louder. Despite its inherent complexities, it is being made out to be technology suitable for every organization of every size and level of tech-saviness. That is not the case. With some products that facilitate its usage being added to the mix, it is possible, however. The vendors are clearly starting to scope out this untapped pool of potential customers. It will be interesting to watch how fast organizations bite, as well as whether this develops into the next cloud vendor hotspot.

Read it all here.

Amy Newman is the amazing managing editor of ServerWatch and Enterprise IT Planet. She has been covering virtualization since 2001, and is the coauthor of Practical Virtualization Solutions, published by Pearson in October 2009.

Tags: cloud, cloud computing, Cloud.com, CloudStack, virtualization
No Comments »
Posted by mgrollman Permalink |

Open-source support: Can it scale?

May 3rd, 2010

May 3, 2010
by Matt Asay, for Open Road

Open-source software had a very good 2009, and all indications are 2010 is on track to be even better.

Enterprises turned to open source to shave money in the economic downturn and are staying with it now to drive greater innovation and productivity.

This brings great hope to open-source vendors, anxious to cash in on open source’s rising popularity, but it also introduces some specific challenges as they scale their organizations to meet demand.

Specifically, since support is the lifeblood of any open-source business, how can companies expand their support capabilities while simultaneously scaling profitability? The two don’t necessarily go together.

Exacerbating the problem, support in an Enterprise 2.0 world is doubly challenging. Important information can reside inside the firewall but also in public forums, wikis, forges, and other community sites. Asking support reps to look across all these data repositories can mean looking in five or six different places.

This isn’t efficient over the long term, and it means that support organizations can struggle to meet enterprise SLA requirements, which is bad for the overall growth of open-source usage in the enterprise.

JasperSoft, a company I advise, is a case in point. The company recently announced that its software has been downloaded more than 10 million times and that it has more than 125,000 registered community members in more than 150 countries. Gartner piled on, reporting JasperSoft to be the fastest-growing business intelligence vendor in 2009, open source or proprietary.

Great news, right? Well, sort of.

While growth is good, it also has created severe challenges for Jaspersoft’s support organization. I talked with Matthew Geise, who runs support at JasperSoft, and he related to me the difficulties inherent in manually slogging through Jaspersoft’s documentation, internal and external wikis, Salesforce.com case management system, and the JasperForge.org community site looking for information.
(Credit: Exalead)

JasperSoft helped alleviate the problem by deploying Exalead CloudView. Geise was able to create a unified search box for JasperSoft’s support reps that examines all of JasperSoft’s disparate data sources. He estimates that the improved support boosted efficiency by more than 40 percent, a finding that is consistent with Aberdeen research.

Not bad.

So, maybe this is a way forward for open-source vendors that don’t want to sell proprietary extensions in an open-core model. I suspect, however, that improved support operations will remain just one piece of the overall story. No matter how efficient one can make support, there are still far more efficient and profitable models out there. (Google, anyone?)

Hence, while support will remain a critical component of open-source offerings, I suspect we’ll see it become one of several menu items that open-source companies offer. Those that do it most efficiently will earn outsized returns, but only if they marry support to other value-adding services/software.

Does this mean open source is becoming more like the traditional software model it seeks to displace? Perhaps.

Rod Johnson, founder of SpringSource, argued a few years ago that enterprises should only acquire support from vendors that have substantive control over the code in question, which makes a lot of sense (the source of the code will be best able to support the source code) but also undercuts the “no vendor lock-in” ethos of open source.

This ethos, however, appears to be much more important to the vendors that sell open source than those who actually buy it. With 95 percent of enterprises Gartner surveyed maintaining or growing their SaaS deployments in 2010, there doesn’t seem to be a shortage of companies looking for simplicity at the cost of flexibility.

I’d argue, therefore, that while it’s good to find ways to streamline traditional support to boost profit margins, open-source vendors would do even better to find ways to marry the efficiencies of supporting SaaS deployments with the ease-of-use such software can offer customers. Perhaps providing a “get-out-of-SaaS-free” card in the form of source code?

The cherry on top.

Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company.
Read more here.

Tags: Gartner, Google, Open Source
No Comments »
Posted by mgrollman Permalink |

Xen 4.0 arrives, fault-tolerance capabilities for high rel now on board standard

April 21st, 2010

By: Jeffrey Burt // e-week

2010-04-13

———————————

Xen.org is unveiling the latest release of its open-source Xen hypervisor, boosting the performance, scalability and availability of the virtualization technology.

Xen 4.0, introduced April 13, offers a host of new features designed to address demands coming from enterprises and the growth of cloud computing, according to Ian Pratt, founder and chairman of Xen.org.

Included in the more than 30 new features are fault-tolerance capabilities. Xen, like other virtualization hypervisors, enabled businesses to migrate virtual machines from one physical server to another for planned outages. However, it became more problematic when the outages were unplanned, Pratt said.

The new fault-tolerant feature enables a VM on one physical machine to be mirrored by a VM on another physical server, he said. Should one physical server go down, then the backup VM on the second server would continue running the workload with no interruption from the user’s perspective.

“The new thing here is to … have the ability to keep a second VM in sync,” Pratt said in an interview. “[In the event of an outage], everything just seamlessly switches over to the other machine.”

Many of the high-end databases and similar applications designed for clustered environments have some degree of protection, he said. However, the fault-tolerance capabilities in Xen 4.0 could help with other applications, such as typical e-mail servers.

The enhanced hypervisor also includes support for the myriad RAS (reliability, availability and serviceability) features in Intel’s high-end Xeon 7500 “Nehalem EX” processors and Advanced Micro Devices’ Opteron 6000 “Magny-Cours” chips, Pratt said.

Both processor families, introduced in late March, are the highest-performing x86 processors unveiled by the chip makers. Intel officials have said they are aiming their four- to eight-core processors at the high end of the server market, targeting workloads that traditionally have run on RISC systems or mainframes.

Contributing are the more than 20 RAS features inside the Xeon 7500 chips that until now were normally found in RISC processors, including MCA Recovery error correction, aimed at reducing data corruption and improving reliability.

Xen 4.0 support of the RAS features in the new chip platforms comes from Xen.org’s close working relationship with the chip vendors, Pratt said. The group talks with chip and chipset makers, as well as OEMs, about what it would like to see in hardware five years out to dovetail with what is being done with Xen, he said.

Xen 4.0, through its NetChannel2 feature, also takes advantage of the smart NICs (network interface cards) that are being built to create virtualized environments that offer improved data processing capabilities. At the Intel Developer Forum in September 2009, Intel and Citrix Systems set up a demonstration showing high levels of network traffic coming into a VM running on Xen, something that could not have been done without smart NICs, Pratt said.

Being able to run such network-intensive and latency-sensitive applications means that essentially any workload can run in a virtualized environment, he said.

“Now it’s almost possible to say that there are no apps out there that are not good for virtualization,” Pratt said. “Now you can look at everything in the data center [as candidates for VMs].”

Xen 4.0 also includes a number of new memory enhancements, such as Transcendent Memory, which removes the pitfalls inherent when guest operating systems use spare memory available on physical servers, he said.

Before, the nature of the spare memory was hidden from the guest OS, so if the other software needed that memory, performance would nosedive.

With Transcendent Memory, the use of the spare memory is more upfront, letting IT administrators know, for example, if the memory has been used in a dynamic fashion, and letting them decide whether they want to try to use that memory.

A full list of the features in Xen 4.0 can be found at the Xen Community Website.

Pratt said along with the new features in Xen 4.0, the Xen Community and other open-source projects have spent the past year looking to make the Xen hypervisor platform more standardized in two areas—desktops and laptops, and cloud computing.

The goal is to create Xen-based turnkey offerings with a more complete and standard software stack that businesses can more easily implement, he said.

Obama’s $79 Billion Tech Plan May Favor The Cloud

March 12th, 2010

By Katie Hoffmann, Bloomberg

Vivek Kundra

Vivek Kundra, the Obama official with $79 billion to spend on technology, said the government can be more efficient by putting programs on the Web, paving the way for companies like Microsoft Corp. and Google Inc. to win business.

The government wants to put data such as health-care pricing information on Internet-based systems as they grow more secure, the U.S. chief information officer said in an interview this week. The U.S. can cut costs by outsourcing that work, said Kundra, who has overseen the federal technology budget since President Barack Obama appointed him last year.

Microsoft, Google and Amazon.com Inc. are all offering more databases and programs online, allowing customers to curb storage costs. Sharing software and data that way would shrink U.S. storage needs, helping to cut expenses after previous governments spent more than $500 billion on data centers and other technology initiatives in the past decade, Kundra said.

“It’s mind-boggling,” said Kundra, a New Delhi native who previously managed information technology for the District of Columbia. “It costs a fortune, it’s duplicative and it’s an energy hog.”

The model Kundra is looking at is known as cloud computing, where users go through the Web to access computers, applications and data instead of through their own servers. He declined to say which companies are best fit to operate government clouds. He noted that Google and Redmond, Washington-based Microsoft have introduced government-focused clouds in the past few months.

‘Darwinian Pressure’

“Let the free markets decide which company is best,” he said. “We want lots of companies with lots of great ideas competing with a Darwinian pressure.”

Global spending on cloud computing may top $44 billion in 2013, according to research firm IDC in Framingham, Massachusetts.

‘“We are excited to see the U.S. federal government embrace the cloud and expect it will further boost confidence among businesses of all sizes to do the same,” Ron Markezich, vice president of Microsoft Online, said in an e-mailed statement.

Cloud computing can give the government “dramatically reduced costs,” said David Mihalchik, who heads federal business development for Mountain View, California-based Google. “All of these things help government employees to collaborate together, be more productive, and the government saves money,” Mihalchik said.

Government Work

Kundra, 35, traveled last week to the West Coast, where he met with companies such as Google and Apple Inc. in California, as well as Microsoft and Amazon.com in Washington, on a 48-hour tour of technology businesses. He said he was impressed by how they created online platforms that allowed third-party software developers to collaborate.

Last year, Kundra created Data.gov, which lets federal agencies post information for the public online and now supports more than 169,000 databases. Other projects, such as those that deal with public safety or health care, also could be put on a cloud, creating a way to share ideas and data at lower costs, he said.

Companies including Microsoft, Google and Seattle-based Amazon.com are seeking federal security certification so they can compete for work within the federal government, he said.

When he managed D.C.’s technology, Kundra moved more than 35,000 municipal employees to Google Enterprise Apps, which provides e-mail, spreadsheet and word-processing programs via the Internet. He said he’s willing to move federal employees to a similar program, if security is proven.

“As long as these companies address security, we’re going to be shifting our resources toward cloud computing,” Kundra said. The government would still own and operate some of its own secure cloud-computing systems.

Read more here.

Tags: cloud, cloud computing, CTO, Cybersecurity, Czar, Federal, Google, Obama, security, Vivek Kundra
No Comments »
Posted by mgrollman Permalink |

AppZero Named One of “100 Coolest Cloud Computing Products”

March 7th, 2010

AppZero technology encapsulates a server application in a Virtual Application Appliance (VAA)

By Cloud News Desk
February 2, 2010 07:15 PM EST

AppZero has announced that Everything Channel’s CRN has named its server-side application virtualization software one of the “100 Coolest Cloud Computing Products.” The Top 100 Cloud Computing products include 20 storage vendors, 20 security vendors, 20 productivity vendors, 20 infrastructure vendors and 20 platform vendors.

AppZero technology encapsulates a server application in a Virtual Application Appliance (VAA), which contains all of the application’s dependencies, but with zero operating system (OS) component. The VAA, freed from any OS encumbrance, can move seamlessly from data center to, and among, clouds and back across both physical and virtual servers.

“AppZero’s mobility of server-side applications makes it easy for enterprise data centers to instantaneously provision a single copy of a ‘gold’ application image to 1,000s of machines in the data center and/or to any cloud or combination of clouds,” says Greg O’Connor, AppZero CEO. “This automation of installation and configuration of server applications speeds deployment, reduces errors, and cuts the need for a human touch.”

Read the rest here or check out the corp website directly here.

No Comments »
Posted by mgrollman Permalink |

Microsoft, HP Announce New Cloud Partnership, But Few Details

February 20th, 2010

By Damon Poeter, ChannelWeb

Talk about a heavyweight card. Microsoft (NSDQ:MSFT) and Hewlett-Packard (NYSE:HPQ) rolled out their high-profile CEOs Wednesday to pitch a new technology stack collaboration for the data center that will see $250 million invested by the companies over three years and focus largely on cloud computing.

“The world is accelerating and the movement to modern data center approaches is absolutely accelerating. [And] that really means a movement to a cloud model based upon well-defined and well-integrated virtualization and management approaches,” said Microsoft CEO Steve Ballmer, explaining why the Redmond, Wash.-based software giant was entering the partnership with Palo Alto, Calif.-based HP at this time.

Calling it “the deepest level of collaboration and integration and technical work” that Microsoft and HP have every embarked on, HP CEO Mark Hurd added, “It was time for us to really align our enterprise businesses.”

The two technology giants promised that “dynamic IT solutions” will result from their renewed partnership, particularly in areas like virtualization, e-mail and database management for both public and private cloud computing. The plan is to better integrate Microsoft products like Microsoft Exchange Server, Microsoft SQL Server and Microsoft Hyper-V with HP’s server, storage and networking hardware. After such integrated technology stacks appear, the two companies also pledged to work more closely together on go-to-market efforts and ongoing service opportunities.

But absent any actual product announcements or specific go-to-market details associated with what Microsoft and HP are calling “a new infrastructure-to-application model,” some industry observers and even the vendors’ own channel partners were left wondering what’s underneath the bluster.

“This is nothing Earth-shattering. No more than HP’s relationships with Oracle and SAP,” said Dhruv Gulati, executive vice president of Lilien Systems, a Larkspur, Calif.-based solution provider and long-time HP partner.

Facing similar skepticism while taking questions from reporters, HP CEO Mark Hurd insisted that the new arrangement was not just one more in a long line of integrated, bundled data center technology stacks from HP and Microsoft.

“There’s a difference between a bundle and the opportunity now on how deep it gets integrated and how much true engineering work gets done,” Hurd said. But he also admitted that “maybe that gets lost a little just in the words.”

Hurd also played up the benefits of the Microsoft collaboration for channel partners of both companies.

“One of the big issues if you’re a channel partner is ease of doing business, simplicity, promotion, etcetera,” he said. “All of that gets optimized here. The fact that I can now get a bundled solution that’s been tested, that’s been optimized, that’s got collateral material around it, that’s got promotion dollars aligned to it, that’s aligned to both sales forces, you’ve now just simplified my life enormously.”

Hurd had a reliable backer on that front in John Convery, executive vice president of vendor relations and marketing at Denali Advanced Integration, a Redmond, Wash.-based system integrator and channel partner of both vendors.

Describing the HP-Microsoft strategic alignment as “a marriage made in channel heaven,” Convery was especially upbeat about the promise of dedicated channel sales teams for the project, as well as resource and funding support for partners like Denali.

At the same time, some industry watchers wondered whether Wednesday’s announcement was a shot across the bows of certain competitors of either Microsoft or HP. That’s not the case, according to Hurd.

“I wouldn’t want you to think of this as a reaction to anything,” he said when asked if the arrangement with Microsoft represented HP “backing off” from its partnership with companies like Oracle and VMware.

Ballmer was faced with a similar question about the meaning of the HP alliance to Microsoft’s partnerships with other hardware makers like IBM and Dell.

“We don’t have a lot going on with IBM (NYSE:IBM), so let me get the record straight on that,” Ballmer said. “We’re driving out aggressively with Hewlett-Packard. We’re going to do a heckuva lot more together with HP. We respect that HP’s still going to work with guys that we compete with and that we’re going to work with guys that HP competes with.”

Until “a heckuva lot” produces something tangible, one solution provider partner of both companies described the announcement as so much hot air, a monetarily significant but otherwise standard reaffirmation that — surprise, surprise — the world’s largest hardware manufacturer and its biggest software maker work closely to ensure that their respective products play well together.

But the solution provider, who asked not to be named, conceded that “over time,” the HP-Microsoft deal could make an impact on the market.

“They will come up with a strategy. But right now it is all noise,” he said.

Joseph F. Kovar and Steven Burke contributed to this article.

Read more here.

Tags: cloud, cloud computing, Grollman, HP, Michael Grollman, Microsoft
No Comments »
Posted by mgrollman Permalink |

Virtualization Shines in Cautious IT Hiring Picture

January 26th, 2010

Who will IT managers call first when they can hire new staffers again? Virtualization and cloud skills will serve you well, new research says.

Kevin Fogarty, CIO Magazine

January 19, 2010

Surveys showing the spending and hiring picture for IT as bleak for at least the first half of 2010 seem to reflect more the caution of IT managers and CIOs than their real hiring plans.

(For more background on the current IT hiring climate, see two related articles: IT Hiring Increases Last Month Despite Broader Jobs Decline and IT Departments Need Right Skills to Recover in 2010.)

“IT budgets are flat right now because of the uncertain environment, but I expect as people become more confident, the real spending will rise to between four percent and five percent,” according to Andrew Bartels, IT spending and budget analyst at Forrester Research and author of a report released this month that predicts little, if any uptick in IT hiring during 2010.

“Actually we expect purchasing to be up about seven percent for the year, but the staff part of that spending is probably going to lag,” he said. “Companies will buy equipment, but they don’t want to make a commitment to people if they’re worried they’ll have to lay them off in six months.”

The report predicts IT spending will rise 6.6 percent in the U.S. this year, compared to a drop of 8.2 percent last year.

A survey of 110 IT managers at large companies by Wall Street analysts Wedbush Securities showed projects involving virtualization, Windows 7 and enterprise software were all high on corporate priority lists, and that the number of projects stalled for budget reasons has dropped from 38 percent in late 2008 to 18 percent during the last quarter.

If hiring does lag purchasing, this is going to be a good year for recruiters, according to Ellis Blevins, a division director for recruiting giant Robert Half Technology.

“What we see is an explosion in IT resource needs,” according to Blevin, who says increased demand her Denver-based group is consistent with IT hiring in other areas of the country.

“With the economy the way it was, everyone was in wait-and-see mode,” she says. “We have companies coming out of the block in Q1 with 30 people for this project, 40 for that; there’s a lot of pent-up demand coming to fruition.”

Many more of those job openings are coming in as contract-to-hire or full-time employment than has been true the past year, when temporary or contract-only jobs were a common option for companies that needed IT staff but didn’t want to commit to increased headcount, she says.

This quarter, according to a survey Robert Half Technology took of 133 CIOs from companies planning to add staff, business growth is the biggest reason driving the decision to hire. That’s followed closely by rising workloads and an increased need for customer or end-user support.

Fifty-eight percent of companies planning to hire IT people plan to hire only full-timers, the report also showed.

The return of demand might seem sudden, but so was the drop-off, according to Tom Silver, senior vice president of tech-job ad site Dice North America.

“In 2008 we were running average [numbers of job ads on Dice.com] of around 85,000 until September ‘08, when Lehman Bros. happened,” he says, citing the surprise bankruptcy announcement that shocked a shaky U.S. financial market.

“The job [ad] count dropped like a rock; by the end of the year we were down around 55,000,” he says. “As rough a year as ‘09 was, the job count stayed relatively level. The lowest we got was 47,000; it started to tick back up in the fourth quarter. We’re over 50,000 and we’re projecting that to continue to improve.”

Virtualization, Cloud Pros in Demand

The tech in highest demand according to its mention in job ads is programming in Java or J2EE, or database administration, because those skills are part of almost every IT project.

Among the fastest-growing skills, however, are virtualization—which at about 2000 ads is 21 percent above this time last year—and cloud computing, which went from zero last year to 300 today.

“So most other things are flat or down and those two are growing,” Silver says. “You also see companies like USAToday, Delta, Newsweek or Netflix posting them, so it’s not just the higher-tech Silicon Valley companies that are looking for virtualization.”

That demand reflects a need to get stalled IT projects back on track, and infrastructure improvements completed, Blevin says.

“Network administration, virtualization, system administration, those are the heavy-hitting job requests right now—the ones companies need to get themselves up to speed as the economy comes back,” Blevin says. “They want to rapidly develop and deploy applications without issues about servers and infrastructure. Everyone wants to be able to get what they need and get it quickly.”

Bartels, however, like his survey respondents, is only cautiously optimistic.

“Virtualization obviously, is one of the big priorities [for 2010], but even more than most things, adding more virtualization doesn’t mean you’re going to add more virtualization staff,” Bartels says.

Virtual servers are so much easier to maintain than physical servers that it’s possible for very small staffs to manage large virtual infrastructures, reducing the number of bodies needed in the data center.

A November, 2009 report from Enterprise Management Associates, which was sponsored by VMware (VMW), says that in U.S. companies the average number of physical servers one administrator manages is 65. The average for virtual servers is 77. That’s not shockingly high, but it does represent an increase in staff efficiency (and a reason not to need to hire more staff) of about 10 percent.

“Once you hire someone who knows virtualization, when you acquire more licenses, you don’t necessarily have to acquire more staff,” Bartels says. “Even if spending on virtualization software and tools goes up far more than other things—even 10 or 15 percent, staffing might only rise by one percent.”

On the other hand, “if you can use virtualization to save some IT dollars, you can add a person to your staff that you’ve wanted to for a year and a half and haven’t been able to,” Blevin says.