Global CIO: Larry Ellison And IBM Lead Surge In Optimized Systems - InformationWeek

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Commentary
9/22/2010
11:38 PM
Bob Evans
Bob Evans
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Global CIO: Larry Ellison And IBM Lead Surge In Optimized Systems

Promising greater performance plus less busywork and lower costs, Oracle and IBM lead an industrywide movement toward highly engineered and purpose-built systems.

So, really now, is the IT industry's latest heartthrob—optimized systems and/or appliances—really something worth getting excited about, or is it just this year's fleeting infatuation?

Are these highly engineered and integrated hardware/software combos truly going to be game-changers for CIOs—delivering far greater performance, requiring dramatically shorter installation times, and demanding zero tuning and configuring and retuning—or is do we just happen to be seated in the front car of the hype-cycle roller coaster?

I'm betting on the former because the whole premise of these new machines goes far, far beyond the no-value concept of simply taking two 5-pound bags of concrete and combining them into one 10-pound bag of concrete and calling that innovation. Instead, I think, these new-wave systems are surging into the market because they can help companies of all sorts make the leap into the very different and demanding world of real-time business.

These new optimized machines are in full ascendancy at this time because they're the most powerful and highest-value delivery platforms for some dazzling new software applications and technologies designed to analyze not just bigger mountains of data, but in less time and with greater insights and with almost-unlimited variations.

Today's next-generation enterprise software that's bringing alive the promise of business analytics, predictive analytics, real-time analytics, real-time OLTP, staggeringly large databases, and the soaring volumes of queries triggered by many millions of mobile business users has become so powerful and so complex that generic servers—even the biggest and gnarliest boxes—simply can't exploit the full range of insights, foresights and opportunities that today's top software can deliver.

And in response, every single major IT company—hardware vendors, software vendors, and the crossovers as well—are rushing in with their own combinations (Oracle and IBM) or in partnerships (everyone else). Here's a sampling of what several of those companies have been saying about customer interest in highly optimized and integrated systems, and why they're so bullish on the opportunity:

Oracle: Skeptics can theorize all they want about why they think this optimized-system activity is just vendor hype, but big customers are saying that they're big believers: Oracle's Exadata Database Machine is now on an annual revenue run rate of $1.5 billion, while only six months ago that run rate was $1 billion—still a stunning number for a first-year product. And Oracle, concurrent with its release of its new Exalogic Elastic Cloud or "cloud in a box" system, is making the optimized-system the core philosophy of its entire company by weaving it into the company logo and tagline: "Oracle: Hardware and Software: Engineered To Work Together." And as Larry Ellison said, "There will be more things like this to come."

IBM: Shortly after Exadata began to attract significant interest, IBM stepped forward assertively to tout its own extensive family of appliances and what it calls "workload-optimized systems". IBM is attacking the market from a couple of directions: offering all-IBM optimized systems such as its own Cognos business intelligence software on IBM Power systems, while also working in close concert with SAP to develop highly engineered systems featuring SAP applications on IBM servers. On top of that, IBM just this week launched a bid to acquire Netezza, a small but high-growth maker of powerful but affordable analytics and data-warehouse machines.

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One more move by IBM: underscoring the breakdown of the silos that have traditionally separated hardware and software, IBM consolidated responsibility for its entire software business and its entire systems business under the direction of senior vice-president and group executive Steve Mills, who previously had overseen the software group.

Next up is Teradata, whose revenue has boomed since it expanded its line of optimized systems:

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