From M&A to R&D, Cloud is Driving IT Activity

Still wondering if cloud computing is the real deal and if it will find its way to a data center near you? I suggest looking back at the last several months (or year) of vendors girding their loins in preparation for an inevitable battle in the cloud. Whether they’re buying, building or buddying up, vendors are surrounding their core competencies with everything they’ll need to compete in an increasingly integrated IT market.

Buying Their Ways In

This week, all the talk is about either Dell or HP buying 3PAR to get its hands on the latter’s storage lineup, which is optimal for virtualized environments and utility storage. That’s just the tip of the acquisition iceberg, though, even for the two suitors involved. Large vendors, especially, have been on a cloud buying spree, combining for more than 30 purchases in the last 18 months. Take a look:

This list is pretty much off the top of my head, with a little surface-level web research (I’m sure I missed some), but the point is clear: Every one of these purchases targets big data, infrastructure, management, security and/or automation. These are critical capabilities for any cloud environment. As I detail in my new report on VMware, the cloud spectrum is broad, and vendors who want to compete need a holistic story to tell.

Building Their Ways In

Not every vendor is buying its way into the cloud game, though. Cisco famously built its own Unified Computing System server lineup, and has partnered with VMware and EMC to fill out the virtualization and storage components of the infrastructure stack. Thus far, its only cloud acquisitions have been on the services side (and continued networking purchases), but not operations or software. Don’t count on a big acquisition down the line (although I’ve heard some big names bandied about), but do count on a fair amount of continued innovation, especially with Lew Tucker on board.

Microsoft, too, has been building its way into the role of full-fledged cloud computing vendor. Windows Azure, Hyper-V, Systems Center and AppFabric all are in-house developments, as is the forthcoming Dryad parallel-programming framework. Whether it makes a purchase or not, however (I haven’t heard much talk about this happening), Microsoft is pushing the cloud hard.

Perhaps the best example of a company developing its own cloud tools is Red Hat, which this week detailed its expansive cloud portfolio that spans public cloud, internal clouds, IaaS, PaaS, virtualization, APIs, etc. Yes, its platform story hinges upon JBoss, which Red Hat bought in 2006, but the cloud strategy started to take shape quite a bit later. Red Hat has a whole collection of cloudy projects in the works, including BoxGrinder, StormGrind and Infinispan.

Buddying Up

For vendors who lack either the cash or the desire to expand their cloud stories, partnerships have proven a popular choice. The list is long, and includes, I’d venture to guess, every vendor named above. Focusing just on the past week, however, proves helpful: Eucalyptus, rPath and newScale combined their products into an integrated cloud platform; Egenera and Citrix certified a XenServer-PAN Manager converged-infrastructure solution; and OpenStack (a collection of vendors of all stripes) announced an iPad app to manage its forthcoming cloud tools, as well as additional hypervisor support.

The message is clear: Cloud computing vendors must come to the table bearing more than a single component. If they can’t build it, they’ll buy it. If neither of those work, they’ll form alliances. Looking around at the sheer number of startups and established vendors selling individual pieces of the cloud stack, I think the action is just getting started.

Related Research: VMware’s Cloudy Ambitions: Can It Repeat Hypervisor Success?

Question of the week

Where do you think we are in the cloud-acquisition timeline?
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