Posts Tagged Dell
As we enter the last month of the first quarter of 2013, it’s clear that some of the stalwarts of the IT industry are struggling with a rapidly changing market and rapidly changing technological trends. Today’s IT landscape looks far different than the one we saw just a few short years ago and the biggest fish in the IT sea appear to be having issues adjusting to the constantly shifting market waves.
I have a few observations and opinions about three of the largest players in the space and I thought I’d share them.
HP stated on a recent analyst call that its VirtualSystem best-of-breed integrated system is the “only real alternative to VCE” [Vblock]. While HP may have VCE in its competitive sights, all of the major storage vendors have been ramping up efforts in the converged infrastructure space.
While the number of virtual machines (VMs) that can be deployed on any infrastructure will vary by workload and there are many other capabilities (such as energy efficiency, cost, support, performance, and application support) that should be considered in evaluating stacks, it can be seen that not all stacks are geared for all environments.
Over a year ago, I posed the question, “Does 10Gb Ethernet change the Competitive landscape?” Cisco has been the dominant player in networking, for over a decade no competitor ever captured even ten percent of the market. While Ethernet is continuing its march into new markets and new applications, the market landscape has definitely changed. Fresh off of VMworld, there is a buzz in the networking world around new opportunities and architectures.
The Big Trends
Key takes from Dell 2Q12 earnings call are highlighted below. The company saw weaker demand environment related to the consumer and federal segments slowing down mid-qtr. Enterprise demand still holding up across servers, storage, services and corporate PC refresh. Gross margins continue to improve on more disciplined selling (i.e. reduction in unprofitable consumer lines) as well as sales of more Dell-owned IP. In storage, the swap out of EMC revenues continues along at a good clip and margins are improving in tandem, +800 basis points in the last 12 months. Dell expects to return to absolute growth in the storage business by Jan ’12 quarter. Compellent was strong in the quarter, although Equallogic saw some weakness due to supply chain issues (now resolved) and pause ahead of a recent hardware and software refresh. From a strategic initiatives standpoint the most relevant announcements in the quarter were the Force10 acquisition, as well as the availability of Cloudera and OpenStack solutions. More detailed notes from the call are below, or you can view the presentation here.
After a blockbuster year of storage acquisitions in 2010 with over $1B spent each on 3PAR, Isilon, Compellent, many have predicted that 2011 would be the year of networking acquisitions. Many look at Cisco’s entrance into the server business as having a ripple effect of server vendors expanding into the networking space, most notably with HP’s acquisition of 3COM and to a lesser extent IBM’s BNT purchase. This week, Intel signed an agreement to acquire merchant silicon vendor Fulcrum Microsystems and Dell announced the intent to acquire networking equipment vendor Force10. While financial terms have not been disclosed, both of these deals are estimated to be in the hundreds of $Ms and complement existing portfolios rather than changes in market direction or severing of existing partnerships.
While cloud may be the focus of marketing and press campaigns, VMware server virtualization is still one of the primary growth engines for enterprise data center environments today. CIOs have reaped benefits through consolidation and agility of server virtualization, but have had to deal with the ripple effects of how virtualization breaks storage (and networking). Last year, Wikibon took a close look at the integration journey that is required to allow VMware virtualization to continue its growth by creating higher performance storage solutions that can move into mission critical applications. Every storage vendor has a strong push into virtualization in general, and VMware specifically, and while it is a complex story as to who is “the best”, Wikibon did extensive research to peel back the onion on storage integration with VMware. We have posted the full results of the VMware Storage Integration research; this article and others will add some color to the report.
The Cube has been called “The ESPN of Tech” and to extend our coverage of tech athletes, for the first time we will roll out “ESPN2” and broadcast two big industry events – HP Discover and Dell Storage Forum – in a single week. Tune in for independent coverage of two tech bellwether company’s customer events in live streaming HD video.
Here are the logistics for the programming (all times subject to change):
HP Discover from Las Vegas (all times Pacific)
Watch live on SiliconAngle.tv
Conference Twitter Hashtag #hpdiscover
Today, IBM officially announced the formation of its System Networking group (it’s buried in this PR). I’m on the record saying that IBM’s acquisition of BNT is not to attack Cisco. IBM is a master at the practice of co-opetition, and has a stated commitment to maintain partnerships, unlike HP, which has openly declared war on Cisco. The networking industry has undergone a realignment that will challenge Cisco’s dominance in the space.
Last week I attended Interop in New York City where I had the opportunity to speak to many companies about converged infrastructure and cloud solutions. Every vendor has a different definition of what convergence is (it is not melting your data center into a toxic blob) and how it fits into a cloud story. Back at the office, Dave Vellante debriefed me on what I saw – see the video clip below:
According to the Wall Street Journal IBM is in talks to buy Sun Microsystems Inc for at least $6.5 billion. That price tag would translate into a premium of about 100 percent over Sun’s NASDAQ closing price Tuesday of $4.97.
WSJ displayed a masterful ability to hedge their bet by saying that a deal with IBM could happen as early as this week – or fall apart! They also noted that if IBM does buy Sun, it would be the company’s largest acquisition since it bought Canadian software maker Cognos for about $5 billion in January 2008.