SAP and EMC?

Saw this little gem come across the wire today, speculating on a tie-up between SAP and EMC on "web hosting services".

And, while it's very true that EMC brings a lot of value to an SAP environment, I'm not going to comment on the specifics of this article -- sorry, folks, that's beyond my pay grade ;-)

But the author did a great job tying together a number of concepts and trends into an interesting story, and I thought it'd be worthwhile to spend a bit of time and share some of the behind-the-scenes thinking here.

There's A Pretty Big Trend Here

Industry watchers, take note.  There are some pretty powerful forces at play here.

Right or wrong, I am of the belief that we'll see far more IT stuff delivered as a service, rather than a product, and it'll happen far faster than any of us expect.

Whether you describe this in Nicholas Carr's terms, or you think in terms of SaaS (software as a service), or if you're just all Web 2.0 in how you think about the world -- the trend is pretty clear. 

People will want the service, not the product. 

As an oversimplified example: I want to make a phone call, I don't want to own the phone network.

And just about everyone in the IT value chain is going to be impacted.  IT infrastructure vendors like EMC.  Application vendors like SAP and others.  Service providers and outsourcers.  And, yes, IT departments everywhere.

And like every big honkin' trend in this industry, you either recognize it and do something about it, or you get marginalized pretty quick.  I think EMC prefers the former not the latter.

Web Hosting?

The author describes the speculative offering as "web hosting", and I understand why he did it, but I'd offer that this phrase doesn't fully evoke what's happening here at a fundamental level.  We're using the term "cloud infrastructure" as a placeholder to describe what's different in this space going forward.

First, don't think a traditional data center.  We think that the delivery model will require multiple, logical service delivery locations that act as a single, logical entity.  That's true for compute (e.g. cloud computing) as well as information (e.g. cloud storage).

Second, I think the traditional multi-tenancy models won't work going forward.  Today, the two major choices are dedicated infrastructure, or a single instance. 

Dedicated infrastructure means you have your own server, your own software stack, your own storage, etc. and it lives in someone else's data center.  Theoretically, you get a modest amount of scale efficiency by having it all in one place.

The other choice is to use an application that inherently understands multi-tenancy.  Better, but everyone gets exactly the same features -- opportunities for customization are inherently limited.

Between the two is an opportunity for a "virtualized container" model (there's our friend VMware again!) that allows customers to have a customized stack of application, etc. yet still get a vastly improved economy of scale as compared to dedicated infrastructure.

Imagine a "virtualized IT stack" -- server, desktop, network, storage, etc. -- that presented itself as a single logical entity to the consumer, secured from others, service level managed, quickly provisioned, that could arbitrarily scale up or down as the case may be -- or -- be arbitrarily relocated from place to place as needs changed.

Or even composed across multiple service providers, if you really want to think hard about it ...

And Some New Technology Is Going To Be Needed To Do This

I've written before about "cloud storage" and its role in this model.  And, of course, virtualized, orchestrated and relocatable IT resources (server, desktop, network, storage) will be key.

But, consider security for a moment.  How do you make sure this "virtual IT domain" is secured, wherever it might be?  Hmmm, you're going to need a new approach, aren't you?

Or service delivery management -- given that everyone is sharing everything everywhere, how do you ensure that each consumer gets the service experience they expect?  Not to mention other IT disciplines like provisioning, chargeback, etc. 

Or let IT users manage their virtual piece without screwing up everyone else's?

And, if you want to share information and workflow between these "virtual stacks" -- as is becoming more the case as companies collaborate across boundaries -- won't you need something more than a shared file system?

Not to mention all the traditional information management functions: backup, archiving, retention, ILM, etc.

Well, these are some of the problems that are going to have to be solved in the very near future. 

And, if you're a careful EMC watcher, you may see where we might get some answers to these challenges.

So, What Does This Mean?

A lot, really. 

If you're an IT infrastructure vendor, you're going to think long and hard about how you're going to fit in this new world.  When the majority of IT gets delivered as a service, what will you sell, and who will you sell it to?

If you're an application vendor of some sort, you're going to have to figure out how you're going to get access to this type of infrastructure, because that's what your customers are going to increasingly demand.  It'll help you reach new customers, and keep existing ones from moving on.

If you're a service provider, or outsourcer, you'll want to think about this a whole lot, because this is the next new phase of your industry's evolution.  In addition to new infrastructure, you'll come up with new value propositions, and new ways of charging for your value-add.

And, especially, if you're working in IT, you're going to have the opportunity to figure out what you'd like to consume as a service, and what you're going to want to do yourself.  You may find yourself becoming more of an informationist, rather than a technologist.

The only thing I'd offer for your consideration is that you might want to pay very close attention -- because things are probably going to move really fast from this point forward.

Comments

[Cloud Computing]

I am intrigued to find out how EMC see's the distribution and infrastructure method. That is do we see a world where every application vendor creates there own infrastructure and distribution for this new world? Or do EMC see massive infrastructure at Service Providers providing the distribution with application vendors simply sitting on top? Or is it the former to start with morphing into the later, as Application Vendors realise their core business is applications not infrastructure. thoughts?

[Chuck Hollis]

Fascinating question -- one that we've given a lot of thought to, and the answer, right now is "all of the above".

The market is just to nascent to make hard predictions as to the "right" way that it'll go to market.

I can see many of our traditional partners interested in either building or reselling some of these services. Surely, the service providers will get into the game. And, finally, the application providers will have a strong interest as well.

We're trying to figure out a way that we can support all of these different approaches. Ultimately, as always, customers will decide the best way.

Thanks for the comment!

[Derek The Web Hosting Guru]

Good article. The author rightly suggest about the web hosting. Web hosting company offers you the different plans for the users. I would say we must avail the opportinity. There have been a tie-up between SAP and EMC on "web hosting services".