Posted by: Greg Ness | August 20, 2011

The Shrink Wrap Redemption

I never thought I would hear Steve Jobs hail the post-PC era, much less IBM PC legend Mark Dean .  They must be right, because HP just announced its exit from the PC business

But then Microsoft has said that the PC isn’t even middle-aged.

This is as close as it gets to a meaningless debate among marketeers.  Remember all the worthless noise around definitions of cloud computing?  Welcome to the PC-era fluff fight. 

It’s too easy to get lost in the form factor discussion and miss the more important massive transformation taking place throughout IT, driven by the return to prominence of the server/mainframe model in computing.

Erica Ogg (GigaOM) hints at the bigger story when talking about the end of the PC era:

So while the era of the primacy of personal computers in their traditional form is fading, they are not disappearing entirely. They’re just taking on a different form.

The Bigger Story: This is the Dawning of the Age of the Server

Thanks to Apple and others the server is upending the shrink wrap, pre-installed, one-size- fits-all computing era. While the personal computer is evolving into a variety of form factors, complete with hard drives, keyboards and screens/monitors, a major change is taking place in how applications/services are delivered.

The server is becoming more prominent and delivering applications and services more efficiently to larger audiences; and end-users are getting more choice, more customization and more service.

Consumers are no longer forced to buy a PC with pre-loaded software or shop in a nearby store with a few hundred shrink wrap titles selected by merchants and middle men based on anticipated demand, marketing spiffs and channel relationships.  And now enterprises are experiencing the consumerization, and it is putting the squeeze on the power once enjoyed by enterprise tech players with powerful channels, certifications and control.

The software channel was brutish to Apple in its earlier years.  I was one of those many frustrated Mac owners who finally gave up when I couldn’t find the software I wanted.  How many other players were driven out of the game because they didn’t have the funds to go to market (fight for limited shelf space by waving ad spends and promotional discounts or flexing developer relationship muscle based on other mature products, training, etc.).  A similar dynamic has played out in the enterprise market, and so on.

Now Jobs has had his revenge by offering hordes of applications for download… from the server to the device.  That is the real story underneath the “post-PC era” headline.  Apple has placed the server at the forefront of its flank attack on software, music and entertainment channels and the consumer has become the middle man, and the enterprise is catching up.

The server is front and center, which makes the data center increasingly strategic.  It is essentially the new distribution channel for software as consumers get more involved in what they download and when it is downloaded.  That makes the data center ripe for the next wave of innovation.

The Data Center is the New Channel

The requisite investments that once poured into greasing the channel for maximum sales results will now shift into revitalizing the once stodgy data center, the plant and operations architecture and gear that was once “just a building or a room”.  The age of the server will become the age of the data center as enterprises wake up to the increasingly strategic role of application and service delivery directly to end-users.

The bottom line: don’t waste too many cycles focusing on which form factors will win or determining when the PC era is over.  Let consumers decide.  Focus your attention on just how efficient, scalable and aligned your data centers will be to the new competitive demands of your business. 



  1. Note Dell CTO comment from GigaOm (8/29) Dell launches a VMware-based cloud; Azure next(this is the last part of the article):

    The data center is the new server

    That strategy is an awful lot like Dell’s traditional strategy of selling servers full of other vendors’ software and components, only at a much larger scale. In this case, the data center is the computer. VMware’s vCloud, Windows Azure and OpenStack are essentially the operating system choices for this new model of obtaining IT infrastructure. An all-too-easy analogy is that Windows Azure is the new, well, Windows, and OpenStack is the new Linux. VMware vCloud is the new kid on the block that might well dominate in terms of market share.

    Dell’s platform providers certainly see the opportunity to relive past successes in the cloud, too, which is why all three are building ecosystems of providers to distribute their platforms to as broad an audience as possible. Among their early distribution partners are fellow server makers Fujitsu and, potentially, HP.

    Bilger said Dell looked “very deeply” at one revolutionary technology to power a cloud offering, but ultimately decided that although it was highly efficient and very good, that platform required too much application-level change to make it a success among corporate customers.

    There is one key difference between the server business and the IaaS business, though. Bilger noted that it took some time for Dell and Microsoft to form a solid cloud partnership because — in a big switch from its server OS business — Microsoft also sells Windows Azure directly from its own data centers. And OpenStack is a bit different from Linux, he explained, because it takes a fair amount of effort upfront to make it fit for a service offering versus simply installing Linux on a box.

    However, it’s still a while before either of those options see the light of day. Dell’s VMware vCloud offering is available for public beta next month and will be generally available in the fourth quarter, Bilger said.

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