Friday, March 7, 2014

Is IBM Planning a Big Play for Cloud?

At IBM Pulse 2014 (#ibmpulse), many IBM speakers discussed their customers’ challenge of dealing with the speed of change for business and technology.  But interestingly, many of the themes and strategies presented at Pulse 2014 revealed an IBM that is, like their customers, in the midst of dealing with the speed of change. This was exemplified by major shifts within IBM and the progression of its strategies in key technology areas. But before we explore this in more detail, it’s also valuable to reflect on what’s changed since last year’s Pulse.

Pulse 2014 vs. Pulse 2013:

Pulse 2014 signaled the beginning of Pulse as IBM’s Cloud user conference, broadening its mission from its previous focus on IBM Tivoli solutions (now IBM Cloud and Smarter Infrastructure) and their connections to other IBM products. With its new Cloud focus, the Pulse 2014 themes and messages were focused on “Bold Moves”, the need to move to “composable business” to keep up with the needs of the business and how “dynamic Cloud” is the path to getting there.

From an industry viewpoint, the focus of cloud discussions has also shifted. In past years, the focus at Pulse was virtualization, deployment, cloud standards, etc. This year, virtualization seems to have moved off the front burner. And although the imperative for cloud standards are still mentioned, the progress of the on-going cloud standards efforts and IBM’s adoption of OpenStack have changed the discussion from the need to fill an industry void, to the acknowledgement that the cloud standards are progressing forward.

The general discussion of IBM’s Cloud strategy that includes automation, cloud standards,  standardization, the use of patterns,  etc. are consistent with IBM’s cloud discussions from last year. But the dialogue has definitely expanded beyond private cloud and the Infrastructure-as-a-Service (IaaS) level; to hybrid environments, public cloud Platform-as-a-Service (PaaS) and Software-as-a-Service (SaaS). This change may reflect where some of IBM’s leading-edge cloud customers are heading, but in large part, it’s where IBM’s capabilities and Cloud strategy are heading.                 

A major change at IBM since last year’s Pulse was its acquisition of SoftLayer. This acquisition was and is a “game changer” for IBM, as SoftLayer becomes a foundational linchpin for IBM’s current and future Cloud strategy but it is also catalyzing major changes and shifts within IBM.  Read on for my analysis of IBM’s Pulse 2014 and where IBM may be heading.

IBM Expanding its Presence across the Cloud Ecosystem     

Based on the announcements and strategies revealed at Pulse 2014, it is clear that IBM is gearing up to play in Hybrid cloud environments in a big way.  In fact, it looks as though IBM has grand plans for expanding its presence across the breadth of the Cloud ecosystem.  Traditionally, IBM provided customers with infrastructure technology tools, and it will do the same for cloud – delivering cloud infrastructure tools (hardware and/or software) for on-premise and off-premise clouds.

IBM has also offered public cloud services for some time. But a recent acquisition dramatically changed IBM’s public cloud offering and opens up many new opportunities for IBM. [1] Potentially, this new development sets IBM up as a:  cloud on-premise tool provider, public cloud tool provider, public cloud IaaS provider, cloud PaaS provider, cloud SaaS provider,  and SaaS provider of partner re-labeled services. If these scenarios play out, IBM could have one of the broadest reaches across the cloud ecosystem that can’t be matched by most vendors.  IBM will compete with vendors in selected segments, for example providers of infrastructure cloud services or specialized SaaS services. But with IBM’s extensive technology and software resources, including system management solutions, industry solutions, business analytics and Watson cognitive computing, IBM’s future cloud opportunities could be extensive.

If you don’t believe my theory about where IBM may be heading, look at what they’ve already accomplished and the trajectories of the directions they’re heading in.

IBM, the Private Cloud Tools Provider:

Although we’ve been hearing about Hybrid cloud environments from all of the major IT vendors, much of it has been in the realm of “vision”, “future” and an overall marketecture approach to cloud. In general, what many vendors call “Hybrid” is enabling their customers to run their software on-premise or off-premise (cloud), by extending their existing on-premise products to also run in the cloud.

IBM also began their Cloud approach in this way, by extending their existing system management solutions (IBM Cloud and Smarter Infrastructure) to run either on-premise or off-premise in the cloud, and adding cloud-enabling functionality.  These cloud solutions are the core of IBM’s SmartCloud solutions which are tools for deploying and running on-premise, private clouds. 

IBM, the Cloud Infrastructure-as-a-Service (IaaS) Provider:

However, IBM’s cloud strategy changed dramatically with the SoftLayer acquisition last year. With this acquisition, IBM opted to acquire its next generation cloud platform rather than continuing to morph its existing capabilities. In SoftLayer, IBM acquired a “built for the cloud” platform that delivers both dedicated bare-metal cloud services and shared commodity server cloud services. 

These dual capabilities put IBM’s cloud in direct competition with two types of cloud infrastructure service vendors:  the commodity server cloud service vendors and bare-metal hosting vendors. The key to SoftLayer is its flexible API abstraction layer that enables easy switching between different infrastructure hardware choices, in order to match specific workload needs.

IBM, the Cloud Platform-as-a-Service (PaaS) Provider:

Now equipped with its “built for the cloud” SoftLayer platform, IBM is now setting its sights on becoming a provider of cloud-based tools for developers of cloud-based applications, as it develops the next level of PaaS solutions. 

Leveraging its SoftLayer cloud platform, IBM built a cloud Platform-as-a-Service (PaaS) for developers by layering Cloud Foundry on top of SoftLayer. IBM’s newest PaaS called BlueMix, was announced at Pulse. It’s a service that developers can use to develop cloud-based enterprise applications.                         

IBM also announced its acquisition of Cloudant, a Data Base-as-a-Service provider, which also runs on SoftLayer.

IBM also owns and continues to develop API capabilities that can help its developer customers participate as providers and consumers in the API economy. (The ability to compose new applications by integrating cloud-based SaaS capabilities into enterprise applications using APIs.)

IBM, the Cloud Software-as-a-Service (SaaS) Provider:

Further leveraging its SoftLayer cloud platform, IBM announced new SaaS offerings that deliver its software and capabilities via the cloud.  Complementing over 100 public SaaS offerings IBM provides for roles across the C-suite today, the latest SaaS offerings range from Watson cognitive computing-based solutions to IBM Cloud and Smarter Infrastructure service management solutions, as well as Human Resources and Marketing SaaS solutions. 

The variety of initial SaaS solutions is not surprising, given IBM’s vast store of software assets. This is just the tip of the IBM software iceberg, as IBM continues to expand the delivery options for its solutions. Expect many more of IBM’s software solutions to be “SaaS-ified” over the coming months.

In fact, IBM just launched a new online platform, IBM Service Engage, where potential and existing customers can learn about, explore, try and buy some of its service management solutions. Customers can evaluate IBM’s service management solutions using free 30-day trials of the SaaS-based solutions (running on SoftLayer). We also expect more of its service management solutions to appear on IBM Service Engage in the coming months. 

IBM, as the provider of Cloud SaaS re-labeled as Partner services:

As IBM’s SaaS portfolio grows, there’s also the potential for service partners to use IBM SaaS solutions and re-label them as their own new compositions of SaaS suites of solutions. If this step happens, this completes IBM’s broad reach across the cloud ecosystem.   

The Final Word

Cloud computing is evolving, and we are currently in the midst of this developing technology trend. From its recent announcements and strategies revealed at Pulse 2014, and reading between the lines, it appears that IBM is positioning itself to play very broadly across the developing cloud ecosystem.

As the adoption of cloud accelerates and IT spending shifts toward cloud providers, it makes sense that IBM seeks to capture the IT spend on both sides of the equation: as a provider of tools, infrastructure and services to cloud providers, as well as provider of tools, infrastructure and services to IT consumers. 

Mirroring IBM’s Pulse theme of “Bold Moves”, IBM is making bold moves itself. In the short term, this major shift in IBM’s businesses could have major impacts on IBM internally as its business models adapt to business changes. It’s still unclear how this will play out in the long term but it will be interesting to watch. Don't say that you weren't warned about IBM's grand plans for Cloud. Just remember that you heard it here first.

[1] The SoftLayer acquisition will be covered in more detail below.