Cisco, EMC, VMware join hands to take on IBM, HP

Technology heavyweights Cisco Systems and EMC Corp dampened speculation the two companies would merge as they announced on Tuesday a broad partnership to develop data centre technology, taking on rivals IBM and Hewlett-Packard. The two have spent three years developing technology and ironing out details of a deep partnership through which they will bundle Cisco’s networking equipment and server computers with EMC’s storage and virtualization technology.

Their goal is to become a top provider of data centre products as the industry switches to technology focused on providing socalled “cloud” computing services from central data centres that can be accessed over the internet and corporate networks.

As they announced that partnership, top executives from both companies suggested that persistent speculation Cisco plans to acquire EMC has been unfounded.EMC chief executive Joe Tucci said in an interview that the rumours may have been sparked as investors got wind of the close talks between the two companies that led to the partnership over the past few years.

Cisco CEO John Chambers said in the same interview, that “Our tendencies are to partner together. I think we do that remarkably well.” When specifically asked if he was interested in buying EMC, as investors have long speculated might be the case, Chambers said: “You buy big-tosmall. You partner big-to-big.”

The Wall Street Journal reported that the partnership will sell and provide maintenance and service support for a product called “V-Block,” combining EMC’s storage equipment, Cisco’s virtualized servers and networking gear and VMWare’s virtualization technology.

The partnership, the paper said, will have two components. It will be responsible for marketing and providing maintenance and support for V-Block. But the actual cloud infrastructure will be constructed by a coalition of the three companies.

The publication noted that technology giants had breached new markets, “turning once stalwart allies into competitors”.

The move by Cisco, EMC and VMWare, it said, comes amid a wave of consolidation among companies that provide hardware, software and services to corporate data centres.“Following the actions of IBM and HP to create one-stop IT shops, Dell announced in September it will purchase IT services firm Perot Systems. Software giant Oracle Corp, meanwhile, is awaiting European antitrust approval for its acquisition of Sun Microsystems,” The Journal said.

Agencies

Oracle, Wipro join hands to offer w-SaaS

By looking at the potential in the cloud computing segment, Wipro, an IT services company has joined hands with Oracle, a global business software firm to offer a service that software firms can use to deliver products through the software-as-a-service (SaaS) model. The service called w-SaaS will enable software firms to offer their existing applications as SaaS in a multi-tenant model.

The service runs on Oracle's grid computing technologies, which includes Oracle databases, middleware and virtualization software. According to Wipro, this model is expected to result in savings of up to 50 percent of effort for SaaS enablement of existing applications, resulting in up to 10-20 percent savings in the total cost of ownership. "Our relationship with Oracle enables us to provide independent software vendor's (ISV) and joint customers, a powerful platform that allows them to improve their revenues in a cost effective manner," said Srini Pallia, Senior Vice-President and Global Head, Business Technology Services at Wipro.

This announcement from Wipro comes at a time when cloud computing is eating into the profits of several outsourcing companies by offering many similar benefits like reduced IT costs, less internal development of software and reduced management of applications and hardware. According to analyst firm Gartner, the market for worldwide software as a service (SaaS) is forecast to reach $8 billion in 2009, a 21.9 percent increase from 2008 revenue of $6.6 billion.

Wipro expects opportunities for this offering in North America, with growth potentials in the emerging markets of Latin America, Asia Pacific and Western Europe. Energy and utilities, retail, transportation, healthcare and manufacturing sectors will be focus verticals.

Agencies

Intel will launch two CPUs under the Celeron E3000 series

Chipmaker Intel Inc during the third Quarter of year 2009 is likely to replace the current Celeron E1000 series and is lining up production of its new 45nm Celeron E3000 series CPUs.

In a report said that the company will launch two CPUs under the Celeron E3000 series – christened the Celeron E3200 and E3300 – during the third quarter. The company has said that the two CPUs will boast of core frequencies of 2.4GHz, and 2.5GHz, respectively. They would also feature 1MB L2 cache, 800MHz FSB, and 65W TDP. Celeron E3000 series CPUs will support VT-x virtualization.

By Quarter 4, the company is also likely to come out with a new Core i7 CPU. The Core i7 960 CPU will debut with a core frequency of 3.2GHz.

It is expected that the Celeron E3000 CPUs will touch the 10% mark in the fourth quarter overall entry-level CPU shipments.

Meanwhile, the 65nm Celeron E1000s stand the chance of plummeting from 20% in the third quarter to 10% in the fourth. It has been forecast that Intel's Celeron 400 series will account for 18% of shipments in the fourth quarter, Atom D510 around 2%, Atom 330 around 50% and Atom 230 around 10%.

It is also foreseen that Celeron E3000 will jump to 21% during the first quarter of 2010, while Celeron E1000s might get wiped away from the market. The Celeron 400 series will account for around 15%, Atom D510 25%, Atom 330 27% and both Atom D410 and Atom 230 6% each, it is expected.

Continuing with its launches, Intel might also unveil its dual-core Atom D510 CPU for net tops. This is also expected during the fourth quarter, while a single-core Atom D410 CPU will be rolled out during the first quarter of 2010.

Sun Microsystems seen as first salvo in tech battle

Quite a few technology companies could lose their independence in the next year or so as the battle among industry giants IBM, Hewlett-Packard Co and Cisco Systems Inc heats up.

The weak economy notwithstanding, Cisco this week announced its entry into the computer server market now dominated by HP and International Business Machines Corp.

And IBM is in talks to buy high-end server maker Sun Microsystems Inc, sources with knowledge of the matter said on Wednesday.

As these companies deliberately step on each other's toes to search for growth, analysts and bankers say the deals market is warming up with cash-rich tech powerhouses hunting for niche technologies at bargain prices.

Virtualization software maker Citrix Systems Inc, storage company NetApp Inc, and network equipment makers Brocade Communications Systems Inc and Juniper Networks Inc are among those that could catch the eye of tech bellwethers looking to compete in new markets, analysts said on Wednesday.

"If I own 60 percent of a market, maybe I can get to 65 percent, but really, I need a new market," said Peter Bell, a venture capitalist at Highland Capital Partners, of the dilemma that faces maturing tech companies.

Morningstar Inc analyst Rick Hanna agreed: "They're all in the war for increasing the total addressable market."

The biggest tech companies have been trying to become one-stop storefronts for business customers for years, offering software, services and hardware for everything from the data center to the desktop as their own core businesses slow down.

The larger impetus behind any deal making is the advent of two hot trends: virtualization and "cloud computing."

Virtualization software lets businesses reduce space and energy usage in their data centers, while cloud computing technologies let them access applications over the Web. Data centers house computing equipment used by companies.

The "arms race" among companies like Cisco, HP and IBM did not happen overnight, Jeff Bistrong, a technology banker at Harris Williams & Co, an investment banking firm said on Thursday.

HP's purchase of technology outsourcer Electronic Data Systems last year already pit it directly against IBM.

"What's different is we're in a major recession, enterprise values have been significantly diminished," Bistrong said.

Companies held on to their cash in the past few months as they assessed the damage to their business from the recession, said Howard Lanser, a mergers and acquisition analyst at Robert W. Baird said on Wednesday.

But now, the price tags of targets are cheap enough to justify longer-term strategic goals and tech companies that have cash will make the "buy decision," Lanser said.

Cisco has $29.4 billion in cash, IBM has $12.7 billion and HP $11.2 billion, according to recent financial statements.

Bargain Hunting

Companies like Microsoft Corp, EMC Corp and Dell Inc also may seek to own choice pieces of the "cloud," as computing becomes more Web-based.

Microsoft has been bullish on cloud computing, but its grip on data center operating systems could be threatened by the move toward remote data centers, forcing the software maker to search for acquisitions, Morningstar's Hanna said.

Microsoft CEO Steve Ballmer said at a conference on Thursday the company plans to buy up to 20 companies this year, with deal sizes ranging from $10 million to $500 million.

EMC, the world's largest maker of corporate storage, may also look for deals to improve its services offering, analysts said.

EMC itself could get acquired by Cisco; the two companies talked about a deal last year, a person familiar with the matter told Reuters in February.

Analysts said the timing of IBM's move to buy Sun illustrates the partly strategic, partly opportunistic thinking of companies that could drive dealmaking in the next year.

"Cisco has clearly laid out all its cards on the market," said Hanna, referring to the networking giant's plans to sell servers for data centers.

Hanna said he reads the talks as "a preemptive move by IBM to take Sun off the table," to keep rivals like Cisco from getting their hands on a bigger piece of the data center pie.

IBM may be betting that it can do a better job than Sun in taking advantage of these emerging technologies, and use it to compete better against Cisco and HP.

The Wall Street Journal reported that IBM has offered between $10-$11 a share for Sun, the Java software maker, or a total value of $6.5 billion, net of cash.

That's the kind of deal size big companies will be comfortable with as they look to plug holes in their software, services and hardware offerings for enterprises, said Highland Capital's Bell.

Bell, a former chief executive of information storage company StorageNetworks, said small acquisitions were unlikely to satisfy the appetites of large companies.

Rather, companies with market values of between $1 billion and $10 billion would be the focus of acquisitions, he said.

The thinking is more like, "If I can find a larger player, maybe I can accelerate and leapfrog, maybe 12 to 24 months, on my competitor," he added.

Agencies

IBM to host gen-next technology competition

As part of its University Relations programme, IBM has rolled out a novel gen-next technology challenge titled "IBM Blue Battle" in over 25 leading engineering colleges across India.

The first in the "IBM Blue Battle" series has been launched at IIIT Hyderabad and is being conducted on IBM Multi-core architecture for gaming. Colleges to follow include UVCE Bangalore, JNTU Hyderabad, Madras Institute of Technology (Anna University) Chennai, few IITs and NITs.

Amol Mahamuni, programme director, WebSphere Solutions and Technology and University Relations-IBM India/SA, said, "The challenge will enhance the students' knowledge on technologies that are at the helm of innovation across the industry and provide them with an opportunity to develop innovative solutions in real work scenario." It hones their technical skills while learning basic on-the-job skills such as teamwork, organization, and working under deadlines, he added.

The competition will enable participants to work on technologies such as Multi processors/Nano technology, electronics, service oriented architecture (SOA), Multi Core Architecture, Enterprise Computing (IBM System z), Information Management, Web 2.0, cloud computing, virtualization and High Performance Computing (HPC). Mentors from IBM, along with the college faculty, will closely work with the students throughout the programme.


This competition will also enable students to work on projects using IBM products, applications, tools and services in the future through further collaboration and mentoring by IBM experts.


The winners of this competition will receive prizes including Lenovo Ideapad laptops, along with certification from IBM.

IBM's University Relations has been partnering with academia to drive evolving open standards-based IT skills.

CXOtoday.com

Why must enterprises move to Green technologies?

Going green is the mantra often heard among Indian IT enterprises. It is an important business initiative that is driving good corporates towards greener technologies.

Going green is not just about being environment-friendly but also translates into one of the best ways to save money. A recent IDC report indicates that energy and cooling expenses will grow eight times faster than purchasing costs of new servers through 2010. In IDC’s latest Green Poll in the APAC region, almost 81 percent of the participating organizations said that the Green-ness of an IT technology would become increasingly important when it comes to selecting suppliers. About 18 percent of the organizations said that they were already considering this factor while selecting suppliers, while 30 percent said they were putting systems into place to start doing so in the near future. So Green IT opens up an abundance of opportunities for enterprises in any country.

Why should your IT go Green?
Rising global warming, increased energy costs and greater awareness about its socio-economic implications has forced organizations to look for ways to reduce their carbon-emission footprint. However, what has escaped attention is the massive amount of energy your IT consumes. Enterprise IT, which accounts for up to 40 percent of an organization’s energy requirement, has a big role to play to reduce greenhouse gases. According to a Forrester survey, over 41 percent of people in the IT departments believe energy efficiency and equipment recycling are important factors that need to be considered. In the same survey, 65 percent believed reduction of energy related operating costs as the driving factor for implementing Green IT.

What drives Green in India?
Adoption of Green IT is not just about buying green data centers and setting up Green IT infrastructure. It needs a complete 360-degree approach - starting from the vision of the top management to the awareness among employees. “An environment-conscious organization should define what ‘green’ means to it as there is no global, industry-wide recognized standard today that defines a green data center or organization, and take steps to follow the corporate green guidelines. The long-term goal of the green data center operation is to achieve carbon neutrality.

Data centers – The Energy Guzzlers
Undoubtedly, data centers have the maximum energy requirements, given the massive number of powerful servers that are housed in today’s data centers, which are sometimes as big as the size of a football field. And these data centers may require as much cooling power as the electricity to run them. Some studies say that these data centers account for between 1.2 and 2.0 percent of electricity consumed in the United States. It is also a known fact that many of the servers in the data centers run at a low utilization level of 10% to 15%. This causes significant wastage through redundant hardware, memory, network devices and power supplies. In earlier times, enterprises would have put up with this excess capacity, given the IT department’s risk-aversion. However, with maturing IT coupled with need to rein-in energy use, organizations are now forced to adopt strategies to reduce their data center operational costs.

Strategies to implement Green technologies
What are the steps you should take to optimize the consumption of electricity as well as reduce the number of servers in your data center? Enterprise IT groups are looking at various options – such as PC Power management software and deployment of energy efficient servers and network devices. However, these piecemeal steps will not yield the desired results; you need a more holistic approach to solve this problem. The answer lies in the adoption of Cloud computing and Virtualization within your enterprise IT – two strategies that can a go a long way in reducing your energy-dependency and thus make your organization truly green.

Embrace Cloud Computing
Cloud computing lets you use computational power and storage space from a third-party service provider, thus lowering demand for addition of more servers in your data center. You can also reduce the number of applications deployed on your data centers by using similar applications hosted by SaaS providers. Now, cloud computing means different things to different people – depending upon which vendor you talk to. Therefore, it could be utility computing or grid or Software-as-a-Service or even Platform-as-a-Service. However, one thing is clear – all of them refer to some service provided by a third-party provider outside the corporate firewall. It is true there are concerns with respect to security, availability and customer’s data privacy in these services – as shown recently by the outage at Amazon’s S3 storage service. However, these issues will get addressed as the technology and industry matures.

There are primarily two types of cloud services, namely Infrastructure in the cloud and Applications in the cloud. Infrastructure in the cloud refers to raw CPU power and data storage space you can use on-demand over Internet.

You should also explore applications in the cloud type of services as a tool to minimize data center load. Look at business applications that are not critical to your business or those you can’t afford to maintain with a separate IT group in-house – such as CRM apps, HR/HCM, Backup and Restore, Security etc. Instead of running these applications on your data center, you should consider using applications provided by third-party service providers. This, in turn, reduces the number of servers in your data center – which means you have less energy consumption.

Virtualize your data center
As you look for ways to optimize your data center operation, consolidation of servers through virtualization technology provides considerable energy savings. Virtualization is a technology that allows you to partition a physical hardware into multiple logical boxes, with each having its own operating system and network connectivity running in a sandbox. This makes additional standby servers redundant since you can dynamically provision a new virtual machine and then run a new instance of your application on this VM. With advances in virtual machine technology, you can now move a running virtual machine from one server to another server. This further increases the utilization rate of your server stack in the data center; hence you can host more applications with reduced number of servers.

Enterprise technology spending in 2008

Reports indicate that SOA, virtualization are still hot ...

When it comes to technology spending, a quick look at the economy is often enough to get a rough idea of whether budgets are expanding, contracting or staying flat -- and this year is no exception.

"Looking back over the last 60 years, what's happening with economic growth feeds directly into what companies are prepared to spend on technology," said Andrew Bartels, a research analyst at Forrester Research Inc. in Cambridge, Mass. "We see some positive signs that the economy seems to be ...

Experience drastic cut in IT budgets

This is mainly due to drop in system innovations, reducing costs and increase in speed of doing business, says Dell

As most companies allocate about 80 percent of their IT budget for infrastructure maintenance and 20 percent for new business innovations, Dell officials feel this figure can be cut down from 80 percent to about 50 percent in the next six-seven years.

Talking to CIOL Bureau, Sameer Garde, General Manager – Services, Dell India said: "The reduction will be mainly due to the 50 percent drop in system innovations and also due to the reducing costs and increase in the speed of doing business."

Recently, India has been witnessing the introduction of two services, Dell's ProSupport for 'IT' and ProSupport for the 'End Users', aimed at improving local support for enterprise customers by improving turnaround times and offering the ability to fast-track requests.

Now Dell ProSupport assures its customers who add two to three servers every month that they should virtualize their hardware and data centers. "IT infrastructure is where it all starts, i.e., from data centers, servers to desktops. We have virtualized several customer's data centers from 200 to 15 servers thus reducing their costs," he adds.

Dell takes up turnkey projects on end-to-end solution that takes about six-eight weeks to complete. "While the assessment of the data centers takes two-six weeks the design implementation takes six-eight weeks," Garde says.

Reports indicate that Dell has invested about $6 billion in services alone during FY07, and this is likely to shoot up further with more offering in the service space. Having launched its service operations in India, Dell's ProSupport, a globally consistent, customer-driven support offering, spans Dell's commercial product and solutions portfolios.

Dell has distilled more than 10 service offerings down to two customizable packages with flexible options for service level and proactive management.

"ProSupport goes beyond reactive problem resolution and hardware support to include proactive management," says Garde. With the right options, customers can reduce technical incidents by as much as 37 percent and critical downtime by as much as 48 percent, Garde adds.

The company is targeting emerging enterprises with 200 to 1,500 employees, but don't have a help desk. "We are focusing on banking and financial institutions, BPO and also government institutions to offer our service portfolio," he says.

Dell Prosupport wing already has about 650 engineers in India and about 150 call center executives in India. The company offers same day support in 22 cities besides other services in over 300 towns across the country.