Business Tech

By now we've all read hundreds of opinions on why Oracle bought Sun Microsystems and whether this is a good or bad decision. I, too, have an opinion, but for once I'm keeping quiet. Rather, I want to reflect on the sadness I feel as Sun becomes an acquired memory like other pioneering tech companies have.

When I started in the tech business over 20 years ago, it was extremely young and exciting. If you went for a drink after work, you would find a saloon full of folks from Digital Equipment Corp., Data General, EMC, Lotus, McCormick & Dodge, and Prime Computer all out doing the same. Much to IBM's chagrin, high tech had been taken over by a bunch of 20 and 30 year olds in Boston and San Jose, Calif., who were going to change the world.

No company represented this sense of anti-establishment more than Sun. When the industry tried to outflank Sun by forming a Unix consortium called the Open Software Federation, Sun sat on the sidelines and let OSF die on its own. When IBM was struggling in the early 1990s, Sun pushed hard and established a base on Wall Street for Unix servers running Sybase. When Hewlett-Packard fell on tough times, Sun was relentless in its criticism and competitive programs. And who can forget some of Scott McNealy's comments about Windows and Microsoft: "Microsoft is now talking about the digital nervous system. I guess I would be nervous if my system was built on their technology." Groucho Marx couldn't have come up with stuff like this.

Sun's "the network is the computer" was totally accurate and prescient. Sun gave us NFS (network file system), Java, and really helped push the establishment of IP. These contributions can't be underestimated. Unfortunately, Sun was also unwilling to change with the times. Despite McNealy's humor, his comments now read a lot like those of another brilliant but inflexible leader, Ken Olsen of once-mighty Digital.

I'll miss Sun's irreverence, its optimism, and its innovative spirit, but most of all I'll miss what Sun represented, the last vestige of the golden age of the tech industry. Unlike those heady days in Boston back in the 1980s, our industry is now mature with only a few tech giants left. Cisco Systems is now building its own servers and Oracle is a hardware company. I guess we did change the world to some extent, just not the way we thought we would.

By now, everyone in our industry has heard a future IT vision where virtual machines (VMs) migrate from one physical server to another for load balancing, disaster recovery, or maintenance windows. Sounds great in theory, but things in IT aren't this simple. Each VM actually represents an operating system and some associated services or applications. When VMs move around, will they maintain their configuration state or need to be reconfigured? Will multi-tiered applications know that one of their peers has moved to a new neighborhood? Will the network recognize the VM as an old friend or will it assume that it is a new entity? These questions need real answers--not PowerPoint slides.

Fortunately, some very smart people are already thinking about how to solve these dicey problems. The good folks at the Distributed Management Task Force recently published a standard called the Open Virtualization Format (OVF). In geek land, OVF is a way to describe the properties of VMs from the network layer up to the application so they can retain "state" as they are created or moved. As an analogy, think of OVF as a virtual machine's passport and visa. As the VM travels around, OVF gives it an identity, some personal information, and a description about what it can and can't do in its new location.

Good--and necessary--stuff. OVF is no fly-by-night effort, rather it is supported by a who's who of virtualization and industry bigwigs including Citrix, Dell, HP, IBM, Intel, Microsoft, Sun, Symantec, and VMware.

It's clear to me and my colleague, Mr. Virtualization, Mark Bowker, that OVF is exactly what the industry needs to push server virtualization toward more dynamic data centers and integration with cloud computing. What's somewhat of a mystery is why more technology vendors either don't know what OVF is or why they aren't supporting it. For example, Cisco's recent UCS announcement was all about taking server virtualization to a new plateau but there was no mention of OVF. When I asked company officials specifically about this, they told me that they aren't using OVF in UCS. To be fair, Cisco is certainly open to using OVF in the future, but I think my question caught them off guard. John Chamber's folks must have thought, "who is this guy and how does he know about OVF?"

Like many standards, my guess is that OVF is such a nerdy topic that few outside a few industry engineers know what the heck it is. To me, OVF is one standard that has tons of potential--if people know about it and use it. The industry has a responsibility to do a better job of communicating about these types of standards before vendors simply usurp the process with their own proprietary alternative. It would be an absolute crime if this happens.

The tech industry is gaga over server virtualization and cloud computing. It seems like every vendor I speak with describes massive data centers connected to third-party clouds anchored by huge numbers of physical and virtual devices.

Sounds pretty cool, but I wonder how all of these physical and virtual distributed systems will be networked together? This is where reality becomes an ugly guest at the industry virtualization/cloud party.

When you look at how users are connecting physical and virtual servers and networks today, here is what you find:

1. Network design remains extremely simple. Typically, physical servers run 5 to 10 virtual servers. These virtual servers talk to each other through a virtual switch and talk to the rest of the world through a simple connection to a basic Ethernet switch. In truth, VMware ESX offers far more sophisticated networking capabilities, but since most virtualization projects are really focused on consolidating Windows workloads on a reduced number of physical servers, simple connectivity is good enough.

2. Skills are limited. So if you wanted to design a sophisticated network composed of virtual and physical devices with added functionality for security, performance, and high availability, who the heck do you call? Beats me. It seems to me that these skills will be in high demand and some organization will create a certification program down the line. But these future developments won't help today.

3. Tools are immature. OK, so what happens when the performance of a particular virtual server becomes a problem. How do you troubleshoot this? When virtual systems share physical resources, you better have tools that understand this relationship. Lots of companies claim that they have this problem licked, but users still tell me that they continue "flying blind" in these situations.

I haven't even mentioned security, which is another complex problem that the industry is glossing over.

Ultimately, we as an industry have little idea what will happen when you start networking massive numbers of physical and virtual devices together in a single data center, let alone a public network for connection to some type of cloud. We thought we could consolidate applications and serve them up over the WAN. Turns out we needed to develop dedicated technology called WAN optimization to get this right. I guarantee we will find numerous similar pitfalls.

Forgive me for being a cynic, but every time I get my head in the clouds, IT professionals, ESG Research data, and my virtualization-savvy colleague Mark Bowker throw a virtual bucket of cold water in my face. I am simply passing along the favor.

Cisco Systems' Unified Computing System announcement last week seemed to lift the whole industry out of its recession gloom.

All of a sudden, it seemed like massive virtual data centers and cloud computing were just around the corner. Cisco even talked about the fact that its new server platform supports massive amounts of memory so that large organizations can host hundreds of virtual machines on each physical server.

No one I know is more visionary about server virtualization than Mark Bowker, my colleague and Enterprise Strategy Group's virtualization guru, so I asked him what I should make of all of this virtualization gaga. Surprisingly, Bowker said that the industry is getting way ahead of itself and thinks it is time for a virtual reality check. Here are a few data points from ESG Research to back up Bowker's thoughts:

• The average number of virtual machines per physical server is between 5 and 10. This data was gathered from a survey of over 200 enterprise organizations (i.e. organizations with 1,000 employees or more).

• On average, enterprises have about 225 physical servers running server virtualization.

• The main reason why enterprises are deploying server virtualization is to consolidate Windows server workloads.

• Based upon qualitative research, Bowker believes that users are slow-rolling server virtualization because of systems management issues, security concerns, lack of virtualization skills in the IT organization, and I/O bottlenecks.

With this data, it is safe to assume that large organizations are taking a prudent approach to server virtualization. They are using the technology to improve server utilization, rationalize the number of physical devices, and lower costs. They are not building massive virtual data centers and cloud-based compute infrastructure--at least not yet.

In a few years, we will likely see hardware enclosures supporting virtual compute, storage, and networking "bricks." Plug in any brick and it can be utilized by any other brick in dynamic fashion. That said, we are miles away from this vision. Bowker reminds us all that we should judge virtualization technology based upon current deployment activities and near-term requirements, rather than on long-term blue-sky concepts.

A lot of companies have torn down the PC Berlin Wall and now allow employees to use Macintosh computers as well as PCs. Apparently, this creates some interesting dynamics for PC support people.

From what I've heard, most organizations settle in at approximately 95 percent PCs, and 5 percent Macs. Seems like a small and manageable percentage, but here's the rub. According to some services vendors and PC administrators I've talked to, a large portion of the Mac users are executives--CEOs, COOs, chief legal counsel, etc. These folks get top priority and can be very demanding, so network and endpoint administrators have to be on their toes and establish strong Macintosh "chops" quickly. As a result, some IT professionals claim that 5 percent of Macs may as well be 20 percent of the total PC population. Thus 5 percent equals 20 percent.

Historically, IT pundits would point to this inefficiency as a reason why organizations should not allow employees to use Macs. Heck, maybe some analysts still do. There is more in play than just labor cost and accounting here however. "C-level" people tend to get what they want and, obviously, they want Macs.

Do Macs make these folks more productive, creative, or engaged? I don't have any data suggesting that they do, but this would be a worthwhile study. In any case, if Macs make the mucky-mucks happy and a happy worker is a productive worker, those excess PC support costs may be well worth it.

By now you've read numerous blogs, articles, and tweets about the Cisco Unified Computing System (UCS) announcement. While this event may not carry the same weight as the IBM PC, System/360, or VAX, it is probably the most significant server announcement in many years.

Cisco deserves a lot of credit for its industry chutzpah. John Chambers and Co. were willing to risk deep relationships with HP and IBM to enter the server market. In this way, Cisco is adding new innovation to an old market and shaking up the industry as well.

OK, so what about the UCS products? Here is my quick evaluation:

Pluses

1. Innovative packaging that requires less rack space, power, and cooling than a standard blade server.

2. Designed for tight integration with server virtualization and the network.

   a. Cisco Virtual switch (i.e. VN-Link) replaces VMware switch. This links virtual and physical networking policy and management.

   b. Cisco adds extra memory to its server platforms, which enables it to increase the ratio of virtual servers hosted on each physical server.

3. Cisco manages the entire UCS virtual data center with one management platform. Cisco management can be integrated with other management platforms from vendors like BMC.

4. The overall strength is in integrating and improving both storage and network I/O. In this regard, Cisco could have a significant performance advantage in large data center deployments.

Minuses

1. Extremely proprietary architecture. Heck, Cisco is implementing its own version of Ethernet (What is more standard than Ethernet, for heaven's sake?) to consolidate storage and network I/O. The "real" standards won't be in place for another year or two.

2. This is a brand new arena for Cisco where its market share is 0 percent. With Dell, HP, and IBM well established in this market, expect enterprise CIOs to proceed with extreme caution.

3. The advantages of this architecture are minimal in a mixed environment. Today, all enterprises have other servers, and heterogeneous server support is not a core feature of this announcement.

4. Systems management has always been a Cisco weakness. HP and IBM are much better positioned here.

Cisco is aiming for the clouds both figuratively and literally. It is betting that its highly integrated virtual UCS is the best fit for massive data centers and cloud computing. This is probably true as of now, but Dell, HP, and IBM can certainly respond with product enhancements and open standards to bridge this gap. In the meantime, Brocade and Juniper should benefit immensely as server providers look for Cisco alternatives. HP will likely buy Extreme Networks or Force 10 to bolster the high end of its ProCurve networking product offering.

Ten years from now, tech industry historians will remember at least two things about 2009: the economic mess and the Cisco UCS announcement. If nothing else, Cisco just made the industry much more exciting than it was last Friday.

It seems like the headlines are more and more depressing each day. Layoffs, stock market drops, budget deficits, etc. Heck, even my friends in the ever-optimistic Silicon Valley are bummed out.

Yeah, it's looks pretty gloomy, but it's important to remember that the economy isn't binary-- different industries are feeling the pain in different ways. ESG Research recently compared internal data on 2009 IT budget changes by industry with external data from the U.S. Bureau of Labor Statistics Employment Situation Summary from February 2009. This comparison uncovers some interesting trends:

1. Three industry sectors will experience employment and IT budget growth in 2009: health care, federal government, and state and local government.

2. Two industry sectors will cut employment but increase IT budgets in 2009: financial services (mid-sized firms) and communications/media.

3. All other industries covered in this exercise will decrease employment and IT budgets in 2009. These include: retail, professional services, financial services (large firms), transportation and logistics, and manufacturing.

How does this data affect the technology industry? Industry leaders like Accenture, Hewlett-Packard, IBM, and Oracle that have long embraced a vertical industry sales and marketing strategy are best positioned to anticipate market opportunities and move resources around to capitalize on this. The bulk of vendors who take a horizontal approach must learn how to customize solutions and adapt sales/marketing toward vertical industries. In my mind, industry marketing is no longer a "nice to have." It is a "gotta have."

ESG virtualization guru Mark Bowker is keeping me abreast of the goings-on at VMworld Europe in Cannes. In between the merlot and brie, Microsoft and Citrix announced an interesting and potentially lucrative partnership for server virtualization and virtualization management dubbed "Project Encore."

Here's the deal. In spite of its recent release of Hyper-V, Microsoft remains behind VMware in terms of enterprise management features. To bridge this gap, Microsoft is teaming with Citrix to offer advanced server virtualization management through Citrix Essentials. Citrix Essentials builds on Hyper-V with management capabilities for storage management, physical/virtual server provisioning, and lab management automation. Both companies will offer Citrix Essentials through their channels.

The benefits of this partnership could be immediate and profound:

• Microsoft closes the functionality gap with VMware and can thus focus on getting its hypervisor installed everywhere. The goal? Make Hyper-V the Windows of hypervisors.

• Citrix follows Microsoft with advanced management capabilities that are tightly linked to its products. Citrix Essentials goes beyond Hyper-V support to provide some cool orchestration capabilities for XenServer, XenApp, and XenDesktop as well.

So does this mean that Citrix has given up on its own hypervisor? Not at all. In fact, Citrix just announced an aggressive program of its own to give away XenServer with central management and live motion support. Obviously, Citrix wants to build a beachhead of its own.

VMware is still the enterprise incumbent but this announcement may add pricing and margin pressure immediately. With the stock market and consumer confidence in the toilet, it is hard to argue with Windows economics and free hypervisors.

In between the Michael Phelps' no-show incident, Smash Mouth, and celebrity talking-head Forrest Sawyer, IBM's Pulse event in Las Vegas was a good microcosm of the state of IT today and where it is going. Here are a few of my takeaways:

• IBM's "Smart Planet" initiative previews the future. Within the next few years, all kinds of stuff will be instrumented with RFIDs, IP addresses, and bountiful cheap processing power all connected by wired and wireless broadband networks. Organizations that capitalize on this infrastructure will successfully collect, analyze, and make decisions on this overwhelming global intelligence. Even in tough economic times, IBM is reminding business folks that they better be prepared for this inevitability.

• Data continues to explode. All of this smart technology is spitting out a ton of data and there's no end in sight. In spite of the recession, many customers complained that their biggest problems were either finding space for new storage devices or keeping up with storage operations. Clearly we need more automation in this area. IBM seems to be doubling down on storage hardware, software, and services to capitalize on this insatiable storage appetite.

• Cloud computing is confusing--and profitable. I must have heard 50 questions about the definition of cloud computing which should tell every marketing manager in the tech industry to tighten up their messaging. In spite of this confusion however, IBM seems to be doing quite well in areas like managed backup, desktop, and security services.

• Security is baked into everything. IBM deserves credit for recognizing that big honkin' global "smart planet" applications could open up a ton of new security threats. I just hope that its customers get this message.

• IBM's industry focus should help it weather the storm. IBM announced service management solutions for six industries including banking, utilities, and communications. These offerings should be especially attractive in emerging markets building massive new infrastructure.

Finally, a note to IBM CEO Sam Palmisano: Cut all event budgets by 25 percent. Smash Mouth was fun and I wished my sons were with me, but the crowd of 50-year-old techies was headed to the exits after a few songs with fingers in their ears. Forrest Sawyer was an interesting choice as behind-the-scenes moderator but he really added no value. I'm pretty sure IBM could cut unnecessary fluff like this without impacting the substance at all.