Remember that song asking where all the flowers had gone? In a few years you might be asking the same of many of today’s enterprise hardware vendors. The answer is important as you plan your data center 3-5 years out. Where will you get your servers from and at what cost? Will you even need servers in your data center? And what will they look like, maybe massive collections of ARM processors?
As reported in The Register (Amazon cloud threatens the entire IT ecosystem): Amazon’s cloud poses a major threat to most of the traditional IT ecosystem, a team of 25 Morgan Stanley analysts write in a report, Amazon Web Services: Making Waves in the IT Pond, that was released recently. The Morgan Stanley researchers cite Brocade, NetApp, QLogic, EMC and VMware as facing the greatest challenges from the growth of AWS. The threat takes the form of AWS’s exceeding low cost per virtual machine instance.
Beyond the price threat, the vendors are scrambling to respond to the challenges of cloud, mobile, and big data/analytics. Even Intel, the leading chip maker, just introduced the 4th generation Intel® Core™ processor family to address these challenges. The new chip promises optimized experiences personalized for end-users’ specific needs and offers double the battery life and breakthrough graphics targeted to new low cost devices such as mobile tablets and all-in-one systems.
The Wall Street Journal online covered related ground from a different perspective when it wrote: PC makers unveiled a range of unconventional devices on the eve of Asia’s biggest computer trade show as they seek to revive (the) flagging industry and stay relevant amid stiff competition. Driven by the cloud and the explosion of mobile devices in a variety of forms the enterprise IT industry doesn’t seem to know what the next device should even be.
Readers once chastised this blogger for suggesting that their next PC might be a mobile phone. Then came smartphones, quickly followed by tablets. Today PC sales are dropping fast, according to IDC.
The next rev of your data center may be based on ARM processors (tiny, stingy with power, cheap, cool, and remarkably fast), essentially mobile phone chips. They could be ganged together in large quantities to deliver mainframe-like power, scalability, and reliability at a fraction of the cost.
IBM has shifted its focus and is targeting cloud computing, mobile, and big data/analytics, even directing its acquisitions toward these areas as witnessed by yesterday’s SoftLayer acquisition. HP, Oracle, most of the other vendors are pursuing variations of the same strategy. Oracle, for example, acquired Tekelec, a smart device signaling company.
But as the Morgan Stanley analysts noted, it really is Amazon using its cloud scale to savage the traditional enterprise IT vendor hardware strategies and it is no secret why:
- No upfront investment
- Pay for Only What You Use (with a caveat or two)
- Price Transparency
- Faster Time to Market
- Near-infinite Scalability and Global Reach
And the more AWS grows, the more its prices drop due to the efficiency of cloud scaling. It is not clear how the enterprise IT vendors will respond.
What will your management say when they get a whiff of AWS pricing. An extra large, high memory SQL Server database instance lists for $0.74 per hour (check the fine print). What does your Oracle database cost you per hour running on your on-premise enterprise server? That’s what the traditional enterprise IT vendors are facing.