Posted by: Greg Ness | May 24, 2011

The Greatest Story Ever Sold, Part Two

For Some Vendors Cloud Will Become a Destroyer of Worlds

The world of lock-in/pre-bundled, expertise and footprint so kind to the likes of Microsoft, HP and Cisco is gradually transforming into commoditized hardware supporting ever more robust ecosystems of software that can be easily downloaded and installed and even purchased online via credit card.  That world is helping to create new operating models and realities, of which cloud is one.  This is the world that VMware, Citrix, Microsoft and the Open Networking Foundation are creating with “the great decouple”. 

Virtualization paved the way for many kinds of cloud and proved to experts that the decoupling of software and hardware could accomplish what standards bodies could not: a more level IT supplier playing field, starting with servers then very likely expanding into the network itself as more functionality ends up on ever more powerful servers.

Today servers are increasingly populated with ecosystems of solutions, many from lesser known and indirect rivals.  Many in the technology industry are not ready for this kind of marketing challenge; for example, network vendors see more network demands as a panacea (more traffic), not a threat creating inroads for competitors and higher churn potentials than ever.

Some of the networking marketeers so proudly messaging on this year’s energetic Interop exhibition floor might want to ask a few Sun alums what to expect.  Gabe Lowy and Lew Tucker have nailed it, further validating Cisco’s recruitment of (Sun alum) Lew and the establishment of VCE at this critical time in its history.

For evidence of the power of this trend simply follow the numbers from Microsoft, HP and Cisco in recent years and contrast them to the growth of VMworld and the increasingly robust and powerful ecosystem of companies that were “no names” ten years ago.  Also note: A disproportionate number of these players were either bootstrapped or succeeded with light VC funding.

New and more energy efficient data centers will house ever more efficient IT operations, and the social media and MMOG players will drive innovation because they’re dealing with issues that will impact enterprise IT in the future: elasticity, growing endpoint populations, operational pressures including power, cooling, rising densities and churn.  In the future enterprise IT more closely resembles service providers as they embrace private and public cloud operating models.

Software markets then start behaving more like the entertainment and recording industry with one hit wonders, blockbusters and top twenty enterprise/consumer download lists.

Note: this is a continuation on the theme from the previous blog based on a conversation with Gabe Lowy: Cloud-The Greatest Story Ever Sold.


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