Dinosaur love hug: Dell's $64bn death pledge to EMC A trouble shared is a trouble doubled. Thus spake Frank Spencer, sales director of DataCenter, and thus goes the marriage of two legacy enterprise tech vendors. In a $67bn megadeal, EMC and Dell will combine; it's like HP-Compaq all over again, like two dinosaurs mating just before extinction hits. The markets involved are, …
Who says Apple is dominant? Yeah they're the biggest company, but they don't have even a majority share of any markets. IBM was dominant because they effectively had a monopoly in the mainframe space. Apple may be more profitable than any other company, but they don't have even 20% share in the market they make most of their money.
If you wanted to argue dominance in the monopoly style IBM fashion you were talking about, you should have mentioned Microsoft or Google instead.
Back in the day it was IBM and a bunch of dwarfs. Now, IBM is just another lumbering vendor of IT services. Pretty good in some areas and a complete disaster in others. Apple has never as dominant as IBM which is probably good for Apple; there is someone nipping at their heels.
I've read a million comments online about this deal, and how Dell buy various companies, tell their customers how great things are going to be, then leave the new products or services to wither on the vine.
I have no real experience with these sorts of things, but people who claim they have can see a pattern here, and it doesn't involve good service for customers.
Excuse me now, I need to call Dell to find out why my replacement drive hasn't turned up.
I agree completely Fraggle. It seems that even the articles not about the cloud are about the cloud now. I guess since everyone else is doing it, which they aren't, we should all just mindlessly migrate ourselves to the cloud. Btw, I do agree with the points he made about De' Evil Machine Corp being doomed for failure. Two hated companies combine it doesn't make a positive.
"Ultimately Cloud is marketing speak for renting someone else's datacentre. There are real computers with real storage. So who is supplying them?"
They buy from OEMs, typically in China. All built-to-order and built-to-spec. Google uses servers that most of Dell's market wouldn't even recognize as a server. Google uses top-of-rack and distribution switches that are also built-to-order, and are completely proprietary to their data center.
Basically, all distributors are walking dead. If the only part of the box you make, is the box itself, eventually customers get big enough to buy the parts from the same people you do, and get rid of the middle men.
Only the biggest companies like AWS, MS or Alphabet have the R&D needed to build their systems from scratch (and the willingness to sell time on them, FB, for example, does not yet), and I'm sure even them are buying some high-end one from the well known supplier for critical tasks.
Unless one day everything - really everything - run from four-five enormous distributed datacenters in the hands of a few companies (making IBM Watson prediction "I think there is a world market for maybe five computers" true), there will be still a huge market for "off the shelf" systems to build your own datacenter and "cloud" with building blocks without the need to hire the expertise to build them from scratch.
After all, it's just like software. The big ones write their own software all along the stack, the others buy.
Asay is another "monodimensional" businessman, he can see only one dimension at a time. Now he's obsessed with cloud and AWS, until he'll discover another "disruptive" technology to worship. Often he looks like Lord Bong of #businessmodel.
While I hesitated a bit before rising to the click-and-comment-bait caused by the humping dino's imagery, there seems enough reason to proceed.
Here goes, while I think it's clear that AWS has changed the equation of computing industry, many have already moved on from the golden hammer phase of cloud huffing bliss. Cloud services dominate in some layers in the market, but amusingly like real clouds there are gaps at the top and bottom of the market where the numbers stop adding up to any compelling advantage. Smaller players that aren't looking at making big changes in scale sit under the cloud layer, and people already operating at scale can get pricing down below AWS in many cases, if they have the talent pool. EMC's going to get beaten up for it's lunch money because a big part of it's market is the middle of the cloud bank. Their standalone storage solutions are too expensive for the low end, and at scale out the big fish start making things that look more like Backblaze or Facebook's storage tiering. At the same time, I can garage-build out a local DAS array at lower cost then Glacier from commodity parts. For Dell, Supermicro is a bigger threat for the storage dollar.
So I can agree that EMC may deserve the dinosaur label, but there is more to the deal than storage and servers. While Dell has had a hard time with it's own lackluster storage options, at 68 Billion, this deal probably has more to do with VMware in the long run. Other reporters here have expressed that Mr Dell has taken a personal interest, and financial stake in VMware, so I think that is the place to seek answers.
The next question is, has Dell the man read the computing industry better this time around and will Dell the company adapt it's strategies more quickly. I can say the post privatization Dell has been far easier to work with as a business. The have managed to avoid strangling several of their non-storage acquisitions, so (selfishly) I hope that VMware will finally be freed from the leash of EMC's management. With VMware Dell now has the pieces to promote a Hybrid-cloud story that can put down roots outside the AWS cloud band, as well as a cloud solution that can compete on something other than price. A Dell/VMware/VCloud world starts to look on better footing against Microsoft's HyperV/Azure play, and Amazons Golden Hammer one-cloud-fits-all system.
The last question is, can it execute on that play while towing 68 billion in debt?
Very well written and thought out comment. I spent 4 years working for the Evil Machine Company; time which I look back upon fondly until I left and moved along to a "cloud" SAAS company.
While Mr. Dell is a very smart man, I'd agree that his eyes on the 'prize' per se is VMWare. Dell has never really had anything (or acquired anything) innovative or market-challenging/changing. EMC has massive experience in picking up a radical technology and using their powerful sales force to build a market and sell a product. Then turn that $ around and invest in R&D. I've never seen Dell do anything but pick up a 'me too' technology, and sell it to a price.
Dell has never been innovative; they've been good at making things cheap and driving down the cost of enterprise-class items.
On April 20, 2011, some parts of Amazon Web Services suffered a major outage. A portion of volumes using the Elastic Block Store (EBS) service became "stuck" and were unable to fulfill read/write requests. It took at least two days for service to be fully restored.
On June 29, 2012, several websites that rely on Amazon Web Services were taken offline due to a severe storm of historic proportions in Northern Virginia, where Amazon's largest datacenter cluster is located.
On October 22, 2012, a major outage occurred, affecting many sites such as Reddit, Foursquare, Pinterest, and others. The cause was a latent bug in an operational data collection agent.
On December 24, 2012, AWS suffered another outage, causing websites such as Netflix instant video to be unavailable for customers in the Northeastern United States.
Amazon later issued a statement detailing the issues with the Elastic Load Balancing service that led up to the outage.
In August 2013 "Another amazon Outage Exposes Clouds Dark Lining"
Why do you not think that is possible ? A properly specced and managed server can chug along for years without any problem. I've seen a few myself. I can vouch for one mail cluster that has not missed a minute in the past four years.
Indeed, I too have seen some crazy uptimes on machines, some in the excess of 3000 days (old Sun SPARC hardware was bulletproof, I swear). The thing is, people who can build and run these systems so reliably commend high prices.
To play devils advocate for a minute, the thing about "The cloud". It is not only about the sharing of computing resources, but the sharing of skilled people.
Your average small firm with the local kid as a sysadmin is unlikely to manage these uptimes, nor to afford the people with the skills to do it. However if 100 such SMEs use the cloud, the cloud provider will have the cash around to hire the skilled people, who will then build and maintain a system to a high reliability, and all the SMEs will benefit.
Very large firms usually have enough money on hand to hire these people directly, so they don't need the cloud services (except to reduce capex in building datacentres or buying thousands of machines).
I suspect the future will see a mixed bag of cloud and non cloud. Yes, clouds have outages, but for a SME (especially if tech is not their primary focus) the question is "are those outages less frequent than before, when everything was done in house?". I suspect for many it is. Most firms would rather not have to bother having an IT person on hand at all, let alone run their own server room and manage all that. It is usually not their core business.
People who visit this site have the skills to build and maintain their own systems, so yeah for them the cloud does not bring much to the table (except security concerns, data leakage, and reliance on a third party), however I would say we are not the target market for this technology.
Apparently some do. The added "benefit" appears to be getting rid of local IT.
Like all fads, this one has room to grow before it fades away. In the end of all the hoopla, I think we'll find ourselves with a more robust Internet, and a more balanced view of things. There are things that can go to the Cloud, undoubtedly, and there are definitely some things that should never be put in the Cloud.
So companies will end up with some stuff locally, some stuff on the Cloud, and a clear idea of why what goes where. And Cloud suppliers will become more resiliant and reliable as well (learning from past mistakes, etc).
It's all for the better, actually. But now it's a load of PR bull in a lot of cases.
This thrashing over a supposedly new way of doing things is rather short-sighted.
Remember when Sun said the computer was the network, but nobody had the bandwidth to make a global client-server network?
Now that we can do it, it's not necessarily the thing to do.
Leasing in the cloud will have its place, just like smartphones, tablets and desktops have theirs.
Chill, people. It's all a matter of alternatives and using them as you see fit.
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