Networking and IT have always been “frenemies”. They often compete for budgeting in the enterprises, they certainly have competed for power in the CIO organization. One of the interesting charts I used to draw in trade show presentations tracked how the two areas were competing for “feature opportunity”. By the year 2010, my model showed, IT would have convincingly owned about 17% of the total feature opportunity, networking 28%, and 55% would still be up for grabs. Since no market wants to differentiate on price alone, having a feature-opportunity win would be a big boost for technologies, vendors, and the associated political constituencies in the enterprise.
That forecast largely came true in 2010, and networking did gain strength and relevance. Since then things have been changing. In 2014, the model said that if you looked at the totality of feature opportunity, networking and IT had cemented about 19% each, and everything else was yet to be committed. What changed things certainly included the combination of the Internet and the cloud, but these two forces don’t tell the whole story.
The Internet demonstrates resource can be turned into network abstractions. All forms of cloud computing tend to make things more network-like for the simple reason that they promote network access to abstract IT features. That much of the cloud trend could promote networking versus IT flies in the face of the shift actually seen. What made the difference goes back to abstraction, and the details might explain why John Chambers seems to be saying “white boxes win”, why IBM might (as reported on SDxCentral) be investing more in SDN, and why EMC might want to buy a network company.
Even before SDN came along, we were seeing a trend toward the abstraction of network behavior, “virtual” networks like VPNs and VLANs. This trend has tended to reduce differentiation among network vendors by creating a user-level, functional, definition for services at L2 and L3. Sure, users building their own networks could appreciate the nuances of implementation, but functionality drives the benefit case and thus enables consumption.
SDN takes virtualization of networks in a new direction. By proving abstractions of devices and not just services, SDN makes it more difficult to differentiate even at the level of building networks. If we assumed that SDN in its pure form went forward and dominated, then “white box” is inevitable at least in a functional sense. Only what could be specified by OpenFlow could be used to build services. That’s the ultimate in abstraction.
NFV takes another perhaps more significant step, along with cloud-management APIs like OpenFlow’s Neutron. If you have a means of creating applications and services that consume network abstractions, then anything that realizes these abstractions is as good as anything else. That’s the explicit goal of NFV, after all. Properly applied, NFV says “You can resolve our abstractions of network services using SDN, but also using anything else that’s handy”. It embraces the legacy elements, which limits how much network incumbents can do to stave off commoditization by bucking evolution to new models like SDN.
The interesting thing here is that networking, despite having a lead before, lost ground between 2010 and 2015. Not lost in terms of investment but lost in terms of feature-value leadership. Perhaps even more interesting is that IT didn’t gain, it also lost. The gainer was the “in-between”, and I think that’s the most important lesson to learn here.
Virtualization is the general trend at work here. It’s a combination of abstraction and instantiation, intended in large part to promote resource independence. Abstraction reduces everything to functionality. Functionality is a slave to demand, not to supply, and abstraction’s very goal of resource independence shouts “Hardware doesn’t matter!” The important thing my modeling shows is that both IT and networking are losing, and nobody grabs for a lifeboat like a drowning man. Thus, it’s abstraction that I think is behind the news items I cited.
EMC, whose VMware unit acquired Nicira, is in a position to abstract everything in physical networking. A virtual overlay doesn’t care what the underlayment is. The problem that they have is that even if the “undernet” is anonymous, it still has to be something. So it makes sense for EMC to think about buying a network company to get some real gear. If they don’t then a vendor who offers real equipment might well offer virtual-overlay software too. A vendor like Cisco. Chambers knows that overlay wins, but he dares not to say “overlay” because everyone will then think VMware/EMC. So he says “white box”, and commits his own version of abstraction.
For a vendor on the IT side like IBM, the smart play is to abstract the network stuff as completely as possible. So IBM is an OpenDaylight champ, and it continues to develop OpenDaylight even though it seems to have no clear SDN story or mission of its own. It doesn’t need one to win; it only has to make sure that a network abstraction wins.
Making network abstraction win means to make sure software wins, because ultimately IBM is now a software company. Hardware, network or IT, is more of a risk than anything else. A giant hardware player can still hold its own against a giant software player because you can’t run software in thin air, or overlay nonexistent infrastructure. So IBM has to fight not only Cisco but also EMC and HP, more perhaps even than it has to fight Oracle and Microsoft. Why? Because software plus hardware will beat software alone, mostly because the majority of spending will still be on the platform and not on the software. The company who has both can sustain sales presence and control, at least in the near term.
Even in the long term, how commoditized can hardware be? We’ve had standard-platform x86 “COTS” for decades and while all the vendors would love to see better margins and less competition, there are still competitors and we’re seeing commoditization and consolidation rather than the collapse of the hardware space. Chambers’ view of a white-box future may be likened to a story about trolls to keep kids out of the woods. He may be afraid that he can’t dynamite Cisco into a more software-centric stance without making it clear that they can’t just hunker down on the hardware forever. Whatever he says, though, you still need vendors to make white boxes and to integrate and support the function/host combination.
The interesting thing is that while Cisco and EMC and IBM have been in the stories, they’re not the players I think will decide the issues. Those are HP and Oracle. HP is perhaps the last real “server” vendor left and Oracle is the real “software” player, if one focuses both categories on the abstraction, SDN, and NFV battleground. Both HP and Oracle are looking for a strong NFV story. Both have good middleware credentials, but Oracle has the advantage in middleware. HP has the advantage with servers, networking and SDN. Neither of the two have fully leveraged their assets. If and when they do they may finally decide who gets to shape the future.