Storage I/O trends

IBM today  announced that they are acquiring privately held Dallas Texas-based Softlayer and Infrastructure as a Service (IaaS) provider.

IBM  is referring to this as Cloud without Compromise (read more about clouds, conversations and confidence here).


It's about the management, flexibly, scale up, out and down, agility and valueware.


Is  this IBM's new software defined data center (SDDC) or software defined  infrastructure (SDI) or software defined management (SDM), software defined cloud  (SDC) or software defined storage (SDS) play?


This  is more than a software defined marketing or software defined buzzword announcement.

  buzzword bingo


If  your view of software define ties into the theme of leveraging, unleashing  resources, enablement, flexibility, agility of hardware, software or services,  then you may see Softlayer as part of a software defined infrastructure.


On the other hand,  if your views or opinions of what is or is not software defined align with a  specific vendor, product, protocol, model or punditry then you may not  agree, particular if it is in opposition to anything IBM.

Cloud building blocks


During  the announcement briefing call with analysts there was a noticeable absence  of software defined buzz talk which given its hype and usage lately, was a  refreshing welcome relief. So  with that, lets set the software defined conversation aside (for now).


Cloud image

Who  is Softlayer, why is IBM interested in  them?

Softlayer  provide software and services to support both SMB, SME and other environments  with bare metal (think traditional hosted servers), along with multi-tenant  (shared) cloud virtual public and private cloud service offerings.


Softlayer supports various  applications, environments from little data processing to big data analytics to little data processing,  from social to mobile to legacy. This includes those app's or environments that  were born in the cloud, or legacy environments looking to leverage cloud in a complimentary  way.


Some  more information about Softlayer includes:

  • Privately held IaaS firm founded in 2005
  • Estimated revenue run rate of around $400 million with 21,000 customers
  • Mix of SMB, SME and Web-based or born in the cloud customers
  • Over 100,000 devices under management
  • Provides a common modularized management framework set of tools
  • Mix of customers from Web startups to global enterprise
  • Presence in 13 data centers across the US, Asia and Europe
  • Automation, interoperability, large number of API access and supported
  • Flexibility, control and agility for physical (bare metal) and cloud or  virtual
  • Public, private and data center to data center
  • Designed for scale, durability and resiliency without complexity
  • Part of OpenStack ecosystem both leveraging and supporting it
  • Ability for customers to use OpenStack, Cloudstack, Citrix, VMware, Microsoft and  others
  • Can be white or private labeled for use as a service by VARs

Storage I/O trends

What IBM is planning for Softlayer

Softlayer will report  into IBM Global Technology Services (GTS) complimenting existing capabilities  which includes ten cloud  computing centers on five continents. IBM has created a new Cloud  Services Division and expects cloud revenues could be $7 billion annually by the  end of 2015. Amazon Web Services (AWS) is estimated  to hit about $3.8 Billion by end of 2013. Note that in 2012 AWS target available market was estimated to be about $11 Billion which should become larger  moving forward. Rackspace by comparison had recent earning announcements on May  8 2013 of $362 Million with most that being hosting vs. cloud  services. That works out to an annualized estimated run rate of $1.448 Billion  (or better depending on growth).


I mention AWS and  Rackspace to illustrate the growth potential for IBM and Softlayer to discuss  the needs of both cloud services customers such as those who use AWS (among  other providers), as well as bare metal or hosting or dedicated servers such as  with Rackspace among others.

Storage I/O trends


What is not clear at  this time is if IBM is combing traditional hosting, managed services, new  offerings, products and services in that $7 billion number. In other words if  the $7 billion represents what the revenues of the new Cloud Services Division  independent of other GTS or legacy offerings as well as excluding hardware,  software products from STG (Systems Technology Group) among others, that would  be impressive and a challenge to the likes of AWS.


IBM has indicated  that it will leverage its existing Systems Technology Group (STG) portfolio of  servers and storage extending the capabilities of Softlayer. While currently  x86 based, one could expect IBM to leverage and add support for their  Power systems line of processors and servers, Puresystems, as well as storage such as XIV or V7000 among  others for tier 1 needs.


Some more  notes:

  • Ties into IBM Smart Cloud initiatives, model and paradigm
  • This deal is expected to close 3Q 2013, terms or price were not  disclosed.
  • Will enable Softlayer to be leveraged on a larger, broader basis by IBM
  • Gives IBM increased access to SMB, SME and web customers than in the  past
  • Software and development to stay part of Softlayer
  • Provides IBM an extra jumpstart play for supporting and leveraging  OpenStack
  • Compatible and supports Cloustack and Citrix who are also IBM partners
  • Also compatible and supports VMware who is also an IBM partner

Storage I/O trends

Some other thoughts and  perspectives

This is a good and  big move for IBM to add value and leverage their current portfolios of both  services, as well as products and technologies. However it is more than just  adding value or finding new routes to markets for those goods and services, it's also about enablement IBM has long been in the services including managed  services, out or in sourcing and hosting business. This can be seen as another  incremental evolution of those offerings to both existing IBM enterprise  customers, as well to reach new, emerging along with SMB or SME's  that tend to grow up and become larger consumers of information and data  infrastructure services.


Further this helps to  add some product and meaning around the IBM Smart Cloud initiatives and programs  (not that there was not before) giving customers, partners and resellers  something tangible to see, feel, look at, touch and gain experience not to mention confidence with clouds.


On the other hand, is  IBM signaling that they want more of the growing business that AWS has been  realizing, not to mention Microsoft Azure, Rackspace, Centurylink/Savvis,  Verizon/Terremark, CSC, HP Cloud, Cloudsigma, Bluehost among many others (if I  missed you or your favorite provider, feel free to add it to the comments section). This also gets IBM  added Devops exposure something that Softlayer practices, as well  as a Openstack play, not to mention cloud, software defined, virtual, big  data, little data, analytics and many other buzzword bingo terms.


Congratulations to  both IBM and the Softlayer folks, now lets see some execution to watch how this  unfolds.


Ok, nuff said.

Cheers gs