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Summary:

Microsoft and HP today announced the two companies would invest $250 million over the next three years to create an optimized platform for cloud computing. The move exemplifies a trend that should worry open cloud advocates and is a blow to Dell, Oracle and perhaps IBM.

The manufacturing floor where HP assembles custom gear for data centers

Hewlett-Packard and Microsoft Corp. today said the two companies would invest $250 million over the next three years to link Microsoft software with HP gear and sell it as one. The two have committed to what they call the infrastructure-to-application model with an eye to establishing both companies as big players in cloud computing. As the cloud gains in prominence, and is increasingly seen as the next-generation computing model, hardware, software and networking companies are buddying up to create a data center that runs like a computer.

So this announcement is HP’s and Microsoft’s strategy for taking on Cisco’s servers and its alliance with VMware, but it’s also a blow to companies without such partnerships, primarily Dell (Related from GigaOM Pro, subscription req’d: With UCS And VCE, Has Cisco Bitten Off More Than It Can Chew?). As for IBM, it has tried and true services, software and hardware expertise from which to draw. So what’s under the hood in the HP-Microsoft partnership?

  • Unifying and incenting a sales channel to sell HP-Microsoft gear.
  • HP won’t stop offering other hypervisors but it will have a cadre of salespeople dedicated to pushing Microsoft’s Hyper-V.
  • Like it did with Oracle, HP is going to build hardware specially optimized for Microsoft applications including an SQL server. HP declined to talk about what this means for its work with Oracle, but since Oracle now is selling its database appliance built on Sun hardware, my guess is that partnership was doomed when Oracle said it would acquire Sun.
  • Microsoft will use HP gear in its Azure cloud.
  • The two will combine R&D forces to build out the future data center, which will be built around containers and will be optimized to run efficiently depending on the application.

Some quick thoughts here that I will explore later today on a call with HP and Microsoft: Efforts such as this one and Cisco’s tie-up with VMware and EMC concern me, as they seem to indicate that the big players are using cloud computing as an excuse to partner with one another. In creating optimized systems of the type that Microsoft and HP will focus on, the danger of vendor lock-in rises. Is optimization becoming code for proprietary?

Behind these optimization efforts is the holy grail for information technology, which is creating a data center that is aware of an application and can deliver exactly the performance required for a specific task and no more. This saves on power costs and also implies that we’ve achieved some type of real-time information and automation that make data centers run like a computer, rather than like a gaggle of servers networked together with Ethernet and duct tape.

But given the concerns about openness between clouds, the optimization efforts of these large vendors seem troubling. Now, your HP gear will be optimized for Microsoft’s proprietary Hyper-V virtualization instead of open Xen. That’s not to say HP’s management software won’t be able to run in heterogeneous environments,  or that other hypervisors won’t run on its gear — HP CEO Mark Hurd was at pains to say it will — but that companies running those environments may take a performance or efficiency hit.

Regardless, the cloud is shaking up the traditional corporate IT market and Microsoft and HP are trying to figure out their own ways of putting their respective selves on top. I don’t think it’s a coincidence that the two started working together on this project back in April, which is when Cisco finally unveiled its server plans. Microsoft CEO Steve Ballmer on the call gave his definition of cloud computing, which basically brings all of this home, “The cloud means a modern architecture for how you build and deploy applications.”

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  1. Coté's People Over Process » Microsoft and HP: Data-center BFFs – Quick Analysis Wednesday, January 13, 2010

    [...] Stacey Higginbotham’s initial Twitter reaction probably sum up what most people will think. Stacy’s GigaOm piece covers the 6 pronged partnership and spells out cloud lock-in angle [...]

  2. I can’t help but wonder, if this essentially implies the beginning of the end to SysAdmins as we know them.
    It implies to me that down the line SysAdmins would become obsolete – since companies will be able to buy a SQL server or an Exchange server, no configuration needed since it will be ready out of the box. Whether it be hosted or in-house. As mentioned in the article the hardware would be aware of the application it is running. Just my $0.2.

  3. Stacey, there is a very interesting conversation happening among vendors and the near-term practicality of the “inter-cloud” over on an HP blog, definitely recommend checking it out:

    http://www.communities.hp.com/online/blogs/nextbigthingeds/archive/2010/01/06/pursuit-of-the-intercloud-is-premature.aspx

    “The standards that are important will enable clients to avoid service-provider lock-in, thus driving competition and improved services. The focus of integration should be integration between business applications and services using Internet protocols.”

  4. Disclosure on my comment above: I am with HP Corporate Communications…apologies for any confusion.

    Regards,

    Ethan
    Hewlett-Packard
    epb at hp dot com

  5. Microsoft and Hewlett-Packard Deal: The Cloud is not Cheap | Enbeeone3 : A Freelancer Thursday, January 14, 2010

    [...] Stacey Higginbotham of GigaOm makes an excellent point in asking if optimization is the new code word for proprietary systems. There’s a danger in that for customers as it can lead to vendor lock-in. [...]

  6. I personally am a bit concerned about this whole “cloud computing” thing, I use it on my new droid. Its frustrating when I, either by choice, or circumstance need to use apps on my phone with out cloud availability. There needs to be some sort of meeting of the two for convenience to the user of both. I understand cloud computing satisfies the Internet Moguls, and they don’t have my attention when I’m not online, nor can they advertise, thus no money. Its not about them its about the user.

  7. Nick Werstiuk Friday, January 15, 2010

    Stacey, as you point out, the “holy grail” is creating data centers that are both performance and resource aware. This is strikingly similar to the old notion of “grid” computing, something that Platform Computing has been doing for years. Ideally, private clouds should provide IT and end users ways to manage, allocate and share resources across workloads that maximize the entire infrastructure—in other words, as you say “work like a computer.” Given spend levels for enterprise apps, that management layer is now a strategic and important element of the cloud equation. Cloud users must ask themselves whether they’re taking control of their architectures, designing for portability and evolving their IT infrastructures to “work like a computer” and whether they’re avoiding lock-in to any particular camp

  8. 2010 is going to be a year of plenty marriages and many broken marriages in the ICT industry the big guys will at all cost outshine smaller companies.

  9. At the risk of sounding like a grumpy old man, what else is new. This is totally in keeping with the way most suppliers view the market. But history has shown that eventually, the need for openness will win out. I have no problem with suppliers collaborating to optimize certain things but not to the extent it creates proprietary lock-in. This is why we launched the Enterprise Cloud Buyers Council (ECBC) last month. It gives users an ability to amplify their voice and speak as one.

  10. Microsoft Pushes Private Cloud Agenda with Hyper-V Cloud Services: Cloud « Monday, November 8, 2010

    [...] and System Center on HP’s BladeMatrix converged-infrastructure system. Microsoft already has cloud computing partnerships with HP and Dell, so their involvement shouldn’t be at all [...]

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