Hardware vendors prepare for the day where no one builds a data center

Summary:Why hardware giants starting to sound like Amazon Web Services? They are all facing a stark reality years from now: No one wants to build their own data centers. Data centers are meant to be outsourced to some other company or taken to the cloud.

IBM launches its SmartCloud and plays in the public cloud computing market. Dell plots a $1 billion investment to build out a data center network to deliver infrastructure as a service. Hewlett-Packard has its blueprint for offering cloud services.

Why are all these hardware giants starting to sound like Amazon Web Services? They are all facing a stark reality years from now: No one wants to build their own data centers. Data centers are meant to be outsourced to some other company or taken to the cloud.

But wait! What about those companies that are building private clouds? Well customers may be on to the fact that private cloud really means more server purchases, more headaches and more inefficiency.

Savvis president Bill Fathers said:

"Enterprises started to build these large private clouds, but then decided to outsource or go cloud. The question becomes whether cloud can be adopted enterprise-wide. Why spend $50 billion and build your own cloud? A third of our wins over the last three quarters have come from companies that had some flavor of a private cloud."

In fact, if you talk to data center architects in the field they'll tell you that no one wants run their infrastructure. In the not-too-distant future we'll farm out data centers to either services giants---IBM and integrators like Accenture---telecom companies we're used to dealing with and hardware vendors positioned for the new world order. Today hardware vendors sell you servers. Tomorrow they will be farms that have acres of computing power that you rent or provision. And yes so-called private clouds will also be outsourced at some point.

Facebook's open source data center architecture is notable, but only applies to so-called scale up Web companies. Most enterprises don't want the extra work. These businesses are tired of being reamed on infrastructure and want a new world order.

In this world:

  • There's no server upgrade cycle.
  • You'll get your computing power from the cloud.
  • And IT folks clinging to their own infrastructure are going to be overruled by the rest of the C-suite.
  • And hardware giants will be selling to the compute farmers.

So what's a hardware company to do? Run to the cloud as fast as it can to hedge bets.

To be sure, hardware vendors are facing the same cloud-inspired turmoil as the software industry. It's no secret that every vendor from Microsoft to SAP has software as a service as a linchpin of the future.

If I were to hazard a guess, the hardware vendors that are best positioned to make the cloud transition will have a strong outsourcing and services unit. IBM will be a public cloud player, but the reality is that most enterprises will see Big Blue as a trusted partner that can catch the data center they just threw over the wall. When it comes to data centers, the mantra increasingly is "here you run this damn thing."

Hewlett-Packard has a similar vision---and a wedding cake slide to go with it---but the cloud plan needs more seasoning and detail. HP, however, also has a large services unit that will run your data center for you.

Dell has staked out an interesting position by becoming the anti-stack vendor. Dell's pitch is that it isn't looking to sell you a complete stack. Dell talks open standards and jumped on the Facebook open source data center bandwagon right away. Dell's challenge revolves around services and the ability to offer infrastructure as a service. Simply put, Dell has to build its cloud data centers.

The odd duck in this hardware equation is Oracle, which as most of you know is basically a software company. Today, Oracle is aiming to sell custom, optimized supersystems dubbed Exadata and Exalogic. If the future is open hardware specs from the likes of Facebook and commodity hardware what does that mean for Oracle? In addition, Oracle hasn't talked about offering infrastructure as a service just yet.

Add it up and there's a lot of turmoil ahead in hardware land. The next few years will reveal what players navigated the cloud curves best.

Topics: Dell, Data Centers, Hardware, Storage


Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CN... Full Bio

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