As we enter our second year of PureSystems, it’s a good time to step back and reflect on how the PureSystems family is complementary to our SmartCloud Services offerings, particularly for our partners.
To review briefly: PureSystems represents the family of private cloud offerings from IBM. These industry leading solutions, which include PureFlex, PureData, and PureApplication Systems, combine hardware, software, and services under a single order number. These systems vastly simplify the installation, administration, and management of a private cloud.
SmartCloud Services refer to IBM’s family of public cloud offerings. SmartCloud Enterprise is our entry level cloud featuring easy onboarding and simplified options. SmartCloud Enterprise+ is our enterprise-class managed cloud providing a range of SLAs and levels of managed support ideally suited for mission critical applications in large enterprises.
The good news for ISVs is that these two families come together at the application layer, in the form of application patterns. An application pattern is a description of the application, including its architecture, middleware components, tuning parameters, and security settings. ISVs create the patterns once, and then clients deploy the patterns on either PureApplication System or SmartCloud Application Services (SCAS).
Application patterns drastically reduce time to deployment and the overall management of the application. And patterns give developers options for both public and private cloud deployment. ISVs who leverage application patterns do not have to choose between enabling to public or private cloud.
In 2001, IBM published the concept of Autonomics, which was a general description of computing systems that are self-managing. Autonomics sought to address the issue of growing systems complexity by proposing technologies that were self-configuring, self-healing, self-optimizing, and self-protecting. Although IBM delivered many products that provided aspects of autonomic computing, it was all delivered in the traditional data center. Application patterns deliver the promise of autonomics in the cloud.
IBM is publishing examples of how application patterns are changing the game for both ISVs and our joint clients—and we’re eager to hear more success stories. Please let us know how application patterns are working for you across private and public cloud.
In a recent CNBC interview, Marc
Benioff, CEO of Salesforce.com, said that the future of IT will
belong to those firms who are investing in social, mobile, and cloud.
Then he went on to point out how well his company has invested in
these areas and how poorly his rivals are investing.
In an October 22, 2011 New York Times
editorial, columnist Thomas Freidman wrote about a
recent visit to Silicon Valley and reported on an IT revolution
“driven by the convergence of social media...with the proliferation
of cheap wireless connectivity and Web-enabled smartphones and 'the
cloud'...” Again: social, mobile, and cloud.
From IBM's perspective, the
social-mobile-cloud sound bite is 75% correct. Cloud computing,
mobile technologies, and social business are inextricably
intertwined, and IBM also believes that those companies investing in
these technologies will be tomorrow's IT leaders. But IBM has a more
complete view of the future, and it's based on our last 100 years of
From the 2011 IBM CIO
Study and the CMO
Study, as well as several third party studies, analytics is one
of the top investment areas for executives who control IT spending.
The social-mobile-cloud sound bite completely misses that point.
True, the cloud makes the explosive growth of analytics possible, and
the explosive use of mobile and social gives everyone more to
analyze, but it is an oversight to leave analytics out of a vision
for what is hot now and what is driving the future.
In addition, IBM describes the future
through what we call the 2015 roadmap, and it has four elements:
growth markets, analytics, cloud computing, and Smarter Planet.
Taken together, these initiatives encompass social business, mobility
enablement, and cloud computing, and put them in the context of a
global market. The roadmap is also more complete than the sound bite
in that it includes a timeline and revenue targets. It's one thing
to say that the future depends on investment in a few technologies,
and it's another thing to publicly commit to a deadline for showing
actual results from those investments.
The roadmap is not merely a technology
statement. IBM's success over the last century is due in no small
part to being able to nurture compelling technologies and create
markets for them. We look forward to working with our partners
turning these exciting new opportunities into success stories for our
This afternoon I was talking with Sumitro Sarkar
from TechStrategy Labs
, who provides pricing and cost analysis for cloud implementations. Wall Street media were abuzz today about a "massive sell off" of cloud-computing related stocks, spurred by earnings warnings by two fairly visible cloud-related companies, Equinix and Autonomy. Articles on Barrons, Forbes, and other sites expressed alarm that Equinix adjusted their earnings estimate downward based in part on "greater than expected discounting..." Barrons listed several other data center vendors who posted losses on the day.
Yet IBM closed the day up 0.18. Although Sumitro and I both agreed that there is no measureable correlation right now between the industry's perception of cloud computing and IBM's stock price, there is--at least possibly--some insights to be gleaned from these data points.
The cloud computing market is much bigger than data center vendors. Indeed, UK--based Autonomy, also cited in Barrons as issuing a warning that spurred the sell-off, is a software infrastructure provider. And Autonomy's business is broader than the cloud, so a warnings statement from them is not exactly a bellweather of the state of cloud computing. There are many aspects to cloud computing--from the tools that enable applications on the cloud to virtualization technologies to the applications end users access--so it's a bit dangerous to draw dire conclusions from the stock fluctuations of a few companies in the data center and hosting business.
But there is an even finer point to observe in the Equinix statement. There are discounting pressures on the hosting providers. This is a sign of a market moving out of the nascent stage, and that has a distinct pattern in the computing industry: In order to continue winning business, cloud vendors will need to differentiate themselves and provide demonstrated value. This will be true for vendors across the entire cloud ecosystem. A "me too" approach at any layer of the cloud will not suffice, regardless of the discounts provided.
There is plenty of room at the table for vendors of all sizes and value propositions. There is plenty of opportunity for growth for all the current participants in cloud. But any vendor who wants a long future needs to be absolutely clear who they serve and how they deliver value.
Last week, IBM announced a new SmartCloud Enterprise Trial. This is an exciting option for customers and partners interested in trying IBM’s IaaS and PaaS offerings before they buy.
Under the trial, which is for new customers only, users create an account, build images, and use the cloud for up to 60 days at no charge. At the end of the second billing cycle, users’ trial accounts automatically convert to fully featured SmartCloud Enterprise accounts. Their images, data, and settings all remain intact.
In years past, IBM would offer limited-time, 90-day trials, usually in the spring and fall. The 90 days were fixed to the calendar, so developers had to be watching for the promotion in order to take advantage of the full 90 days. It was easy to enroll, but feedback was clear: clients and partners wanted an ongoing try-and-buy option. The SmartCloud Enterprise Trial addresses this longstanding requirement.
At the same time, many of our partners have taken advantage of the developerWorks Trial, which has been available since May, 2012. It is a no-charge, 90-day offering for individual developers. The 90 window begins when they create an account. At the end of the 90 days, their assets are purged from the system and there is no option to migrate the images to a permanent account. It truly is a “sandbox” for developers.
Both the SmartCloud Enterprise Trial and the developerWorks Trial provide a subset of the services available on SmartCloud Enterprise. The SmartCloud Enterprise Trial is available immediately in major markets, and will roll out to other countries throughout June and July. The developerWorks Trial is available in all countries where SmartCloud Enterprise is sold.
So why have two trials? The key difference is the preservation of the images and data upon completion of the trial. The SmartCloud Enterprise Trial is designed for anyone who intends to be a long term cloud user but would like to try the service before buying. Thus IBM maintains the images and data created during these trials. When the Trial account converts to a Pay As You Go (PAYG) account, all services and images become available for purchase, but the images created during the Trial persist.
Developers can use the developerWorks Trial for a variety of purposes that often don’t need to persist past 90 days. For example, developers building application patterns for PureApplication System can test their patterns through the SmartCloud Application Services.
In providing two trial options, IBM is addressing the needs to different user types. Please let us know how these options are working for you and your company. We love to share success stories.
In high tech circles, the term “ecosystem” is used to maddening effect. Leaders toss the term around as though it is the answer to every business problem: Can’t build the solution your clients need? Just tell them you’ll deliver the extra capabilities through your ecosystem. Can’t reach all markets? Just tell your investors that you’ll get there through your ecosystem. Need to expand your sales force? Just add “the channel” to your ecosystem.
But what is an ecosystem, how do you know when you have one, and how do you ensure its ongoing success? The term ecosystem is borrowed from the biological sciences, where it refers to a collection of living and nonliving organisms that are “linked together through nutrient cycles and energy flows.” There are three important features of this definition when we transfer it to the high tech business: assessing living and nonliving organisms, understanding the difference between nutrient cycles and energy flows, and appreciating the whole ecosystem as separate from the sum of its parts.
These features are especially insightful when we apply the ecosystem to the industry disruption created by Cloud Computing. We’ll look at each feature separately, starting with living and nonliving organisms.
A Collection of Living and Nonliving Organisms
First, the ecosystem is a collection of living and nonliving organisms. In biology, the ecosystem includes both plants and rocks, or water and sand, for example. In high tech, the corollary is people and assets. When building ecosystems, it’s often easy to focus on either people or assets in a vacuum, an approach that will rarely succeed.
For example, several years ago, we were building an offering for the small business market. This was a new venture for IBM, since at the time we didn’t have offerings that reached below the midmarket and cloud computing wasn’t commercially viable. We had an appliance for small business, and we needed applications to ride on top of that platform. A very large ERP vendor had an application that they were building for the small business market and they were looking for a viable platform on which to deliver it.
The match seemed ideal. Both companies flew enthusiastic architects between locations to meet and build presentations that displayed the elegance of the combined solution. Marketing teams built plans on how to roll out the new offering. Executives agreed over dinner that the partnership would be fruitful for both sides.
Everyone was focused on the nonliving organisms—the platform and the application. But the project never got out the door because once we started looking at the living organisms—the sales teams—we realized that neither side had a channel that could reach our new target audience. We lacked the people who were most crucial in turning the asset into mutual profit.
At least as frequently, partnerships are formed when two companies realize great synergies between their teams. The companies might share a common mission or have similar organizational cultures. Often they have a competitor in common. Highly optimistic conversations about the boundless possibilities of a strong alliance reverberate up and down the organizational chains of both companies.
But without assets, these partnerships are what one pundit called “Barney Relationships.” Barney, the friendly purple dinosaur from a long running children’s show, sings, “I love you, you love me….” While this is charming for kids, in business it’s all just talk. Partnerships, and ultimately ecosystems, need assets that drive revenue for all the parties involved.
An ecosystem starts with very basic building blocks: people and assets. In Part 2, we’ll look at how variations of those building blocks feed on and interact with each other.
In this three part series, we're looking at what the phrase "ecosystem" means and how it applies to the IT industry. The term ecosystem is borrowed from the biological sciences, where it refers to a collection of living and nonliving organisms that are linked together through nutrient cycles and energy flows. In Part 1, we applied the notion of living and nonliving organisms to a partner ecosystem. Next, let's focus on nutrient cycles and energy flows. In a partner ecosystem, these two systems for sustainability translate to two units of measure: one is money, and the other is influence. The two systems function separately, but in harmony with each other.
In a natural ecosystem, a nutrient cycle is a nice way of describing how the bigger creatures eat the smaller creatures. In partner ecosystems, the notion of the big devouring the small seems impolite at best and counter-productive at worst. In fact, the whole metaphor of an ecosystem arguably breaks down when a hierarchical nutrient cycle is applied to a network of partnerships.
But if we look at nutrient cycles as feeding systems, the metaphor becomes useful again. Even if the participants in an ecosystem are not devouring each other, they must find ways to feed each other. In the world of IT, money is the food, and if we can follow the money, we can watch the ecosystem in action.
In a traditional IT business model, with perpetual licenses and renewable maintenance streams, it’s easier to follow the money because “feeding times,” if you will, happen at regular intervals. Just as how bears scavenge campgrounds at roughly the same time every night, renewal license models based on long-term capital expense investments, will result in regular feeding times. And the resulting revenue flows are relatively simple to track.
But in a world of subscription-based licensing funded by operational expense investments controlled by a number of Line of Business managers, following the money is like following a cardinal, watching it eat small amounts all day long from a number of feeders scattered over a wide range of locations, and often sharing the feeders with several other species.
Nutrient systems imply that the participants feed each other. And certainly it is true that in order to sustain the partner ecosystem, every participant needs to contribute to the sustainability of the whole. And every participant needs to derive benefit from the system. So the members don’t need to be devouring each other in order to feed off of each other.
Energy flows in the natural world correlate nicely to the flow of content and ideas between influencers in a partner ecosystem. All participants are influencers to some degree, but analysts, online communities, and pundits are primarily focused on tracking and documenting the exchange of ideas between participants. These people and organizations facilitate the flow content throughout the ecosystem. How these participants get paid is independent of the flow of money that we follow in the “nutrient system” previously described.
Although energy ebbs and flows naturally, one of the challenges in maintaining a vibrant ecosystem is sustaining a high level of content flow. It’s easy to create buzz with a product launch or large event, but it’s far more challenging to sustain interest over time. To keep everyone engaged, the content exchange has to be fresh and relevant. Developer communities have demonstrated how sustain interest through constant innovation, candid online discussions, and a willingness to share content.
As the IT community moves from a traditional, in-house delivery of applications to a open, cloud-based delivery of integrated solutions, the ecosystems that support these communities must expand and transform. Companies like IBM need to move away from “feeding bears” and learn how to “feed birds.”
Modified on by AmyHAnderson
And finally, the system needs to be viewed as a dynamic, interconnected network of constituents. Although it doesn’t need to be difficult to decipher, an ecosystem is necessarily more complex than a simple partnership.
Partnerships are one to one relationships. They can be as structured as a strategic alliance, where the two parties make formal revenue commitments and drive sales jointly, or as casual as two sales reps meeting for coffee occasionally. But’s driven by two organizations with common objectives and a belief that mutual revenue will result from interacting with each other.
Effective partnerships happen when the two companies are highly aligned with each other. Corporate cultures, organizational styles, and compensation programs are complementary, making it easy to work with each other. Distributors and resellers have built their businesses around aligning to the vendors with whom they partner, epitomizing the approach to partnering.
Partner programs are one to many relationships. Vendors build programs to provide benefits to groups of partners. Programs help categorize partners by how they specialize and by their level of commitment to the vendor. Partners derive value through financial benefit, influence with the vendor, and non-monetary support such as technical enablement.
When a vendor develops a set of partner programs, it’s easy to mistake that collection of programs for an ecosystem. But unless the constituents in the programs have independent and systematic access to each other, there is no ecosystem.
A true ecosystem is a set of many to many relationships between partners in the “feeding system” and the influencers in the “energy flows.” As described in Part 2, the flow of money and the exchange of ideas are critical to a sustaining a vibrant ecosystem.
And as the ecosystem matures, there is less need for a single orchestrator to direct the activities of each constituent. Two parties may work together on a project or deal that has benefits that reverberates through the ecosystem. This is fundamentally what differentiates an ecosystem from a set of partner programs.
Open source computing models provide the basis for a mature ecosystem. Open systems have long been heralded as the antidote to vendor lock-in, but in reality, the true value of open computing is the fluidity of ideas, and increasingly the opportunity for new economic models.
For example, when a vendor makes a service available as an API, there are several ways to monetize that service, either through direct sales, revenue sharing, or advertising. Highly mature online communities, fueled by social business, create the platform for this exchange that benefits the entire ecosystem.
Summarizing all three parts
In summary, any organization looking to build an ecosystem needs to start with a three-pronged plan:
Define the whole and the sum of the parts
Who are the constituents?
How do they interact?
People and assets required from each constituent
Who is creating the assets?
What are the assets?
Who is doing the selling?
Money and content
How does the money flow through the ecosystem?
What kind of content needs to flow through the ecosystem and what channels will the content require?
Answering these questions is a lot harder than it sounds. But as the industry moves into this next paradigm of computing, getting these answers right will be critical to every vendor’s success.
Happy New Year!
IBM'ers in the US got Monday, January 3 as our New Year's Holiday, so if you were working today, you probably enjoyed an unusually light email load from your IBM colleagues and friends. Not to worry, the onslaught of communications will resume on Tuesday, January 4. We are all rested, refreshed, and happy to be back at work!
Pundits and analysts across the IT spectrum--those that follow technologies, those that follow sales trends, and those that follow the followers--are in general agreement that cloud computing implementations will increase in 2011. The volume of activity varies depending on who you ask, but everyone agrees that overall levels of activity will increase this year. And in particular, partners of all sizes and from all regions are expressing an increased interest in Private Cloud.
Although a private cloud can take on many flavors, the general idea is that resources in a data center are re-deployed to be more dynamic and flexible. In addition to the virtualization of hardware resources, which many organizations already do, a private cloud allows for a highly dynamic re-allocation of resources across applications.
For example, a large medical organization wanted to run a test of their new backup and recovery environment. Previously, they would have had to acquire a completely identical system to the application they were testing, for what was essentially a one-time test. With a private cloud, they can more quickly deploy an environment that mirrors their production system, run the backup test, and then redeploy the resources for a completely different purpose, probably for a different organization or team. Because a private cloud provides a higher level of systems management--which is available from IBM's Tivoli brand--redeployment of resources is faster than a traditional data center, even one with highly virtualized systems.
For many, building a private cloud seems like a good first step in cloud computing implementations. Large organizations especially continue to express security unknowns as one of their top inhibitors to a public cloud environment, so building a private cloud seems to assuage the security concerns while allowing for the flexibility that cloud offers.
IBM, along with its partners, is ready and able to assist with these private cloud implementations. We're partnering with a variety of partners who can assist you with all aspects of building private clouds, from the concept and design stage to the implementation and ongoing management. And in the first quarter, you'll see us ramp up our activities around private cloud.
Again, welcome to 2011. We look forward to a successful year together.
August 12 was the 30th anniversary of the PC. While some of our colleagues won't remember the Charlie Chaplin ads and the sleek design of those first PCs, it was revolutionary for anyone who had been working with "real" computers. (And yes, boys and girls, the first PCs seemed sleek to us!) Pundits and analysts predicted that these machines would change the world. Curmudgeons grumbled that this PC was just a flash in the pan, that PCs could never do the work of the multi-million dollar systems running on raised floors.
Today we find ourselves in a revolution with similar commentary: pundits are talking about how cloud coupled with mobility changes everything, while so-called curmudgeons in the data center caution against blind faith in an unproven technology. The realities of this emerging technology will play themselves out over the next few years, but one thing does seem certain: cloud computing is taking us out of the PC era.
Cloud computing is inextricably linked to the mobile devices that untether us from the ubiquitous laptop. This new computing environment is not simply a replacement technology for PCs. It represents a new attitude toward technology, where the humans--with all our propensity for social interaction and non-linear thinking--are driving technology, rather than the other way around. Applications are linked and mashed and delivered to suit the needs of individuals and groups, whereas previously people had to adjust their behavior in order to access the application.
In both Mark Dean's article
and at the Cloud conference
I attended in June, experts have been calling this the "post-PC era." But that's only because we haven't thought of a better name. This era of computing is about more than just cloud or mobility technologies, and it's more comprehensive than social networking. It's about a people-centric, on demand approach to computing. As with other eras of computing, a better name than post-PC will eventually surface. I, for one, would not deign to name an entire era, seeing as how I have a hard time naming cats. But regardless of what we call this, it is a great time to be in the computing industry.