Competition among vendors always generates interesting changes, and we may be seeing some more interesting than usual with the announcements of Red Hat and VMware/Dell over the last week or so. Not only is there the usual tension among competitive products, but this time some tension between a vendor who offers open-source software platforms and one that offers both hardware and software. The announcements have hit a lot of market hot-buttons, and it’s worth looking at each to see what’s likely to happen in the next couple years.
Red Hat’s Summit 2018 event was obviously a major focus for the company, and an organizer of its news. The opening comment in their summary video is evocative: “Everything we’ve done for the last 16 years has been to just get us to this point.” Certainly open source software has come into its own, but just as certainly it’s really now just getting started. Red Hat is betting on a future where hardware is just the commodity junk you need to run software on.
The key points Red Hat seemed to emphasize in their promotional material and after-show summary were hybrid cloud, Ansible, the union of CoreOS and RHEL, and virtual networking. The advantage they had in their May positioning (besides the show format) is that their model is inherently partnership-based, and they could let partners do a lot of heavy lifting. That could also be a disadvantage, as we’ll see.
Dell and VMware are wrestling with that trend, but also recognizing that there has always been an advantage for providers who offer a buyer a total solution, meaning one that includes software and hardware. Not only does that reduce buyer integration concerns and accusations of finger-pointing among vendors, it allows more sales focus on an account because the full-service vendor gets more money to justify the effort.
Dell and VMware had their own show schedules, all in the same general period, but I think that the fact that the two were separate made it harder for both units to get the most of their messaging. Of the two, the VMware show seems likely to be the most important because of the “Virtual Cloud Network” story that I’ve already blogged about.
On the enterprise side, the focus of competition was clearly hybrid cloud, for what I think is the blindingly (frustratingly) obvious reason that no enterprise is going to go cloudless or totally to the cloud. This was never in doubt, as my blogs about the issue have said for years, so what’s really going on now is a race to adopt specific measures to facilitate hybridization and along the way protect your own incumbent position in the market.
This is an easier position for Red Hat to support because they have the advantage of having fairly broad position. OpenShift, which is Red Hat’s container platform, is going to be integrated with the CoreOS stuff that is increasingly popular for large-scale deployments. Red Hat also supports OpenStack, of course, and it made a point of pushing the Ansible DevOps solution integrated with Red Hat CloudForms, which is a multi-cloud management framework.
At their event, Red Hat announced OpenShift deals with IBM and Microsoft, and they’ve also jumped on Kubernetes and containers. It’s very clear that Red Hat sees partnerships as a pathway to touching all the right spots in the market very quickly, and it’s a good strategy because it offers Red Hat a position where it matters, when it matters. The only problem is that it diffuses the marketing through many channels and stories.
Despite the fact that Red Hat has a natural lead in this space, VMware isn’t any slouch here. They announced a new version of both vSphere and vSAN, with the avowed mission of supporting seemingly everything, everywhere. It’s not really hype, either, because VMware has deliberately defined umbrella technology to extend from its own virtualization incumbency into the cloud. That unifies VMware positioning, and that could be important in a market that seems to want direction and confidence most of all.
The other hot spot for both companies is carrier cloud. What’s at stake here is what my model has consistently predicted would be the largest single source of new data centers through 2040, and the largest source of edge computing deployments period. Here again, Red Hat seems to have the natural edge. Operators are falling more in love with open source every day, and who’s that if it’s not Red Hat? Then there’s the fact that Red Hat was at least engaged in the early NFV work, even supplying the platform for the CloudNFV stuff I launched back in 2013 (Dell, interestingly, provided the hardware and the test/integration lab to run it).
The Red Hat carrier cloud approach is subtle, perhaps too much so. The focus is more on the “cloud” side than on the carrier side. Nokia/Nuage and Accenture did a nice presentation on SD-WAN automation, but Red Hat didn’t feature it and I only saw it because an Accenture contact sent it to me. It was a strong story in that it named all the hit-buttons of operators today, and I think Red Hat could have benefitted from making it more of a centerpiece of strategy.
One particularly interesting (and subtle) Red Hat initiative is its OpenShift Cloud Functions, a hostable event and functional computing platform that could be incorporated into carrier cloud and hybrid clouds, extending current cloud provider functional computing offerings. Red Hat asks if this is the “next phase of cloud-native development”, likely knowing that cloud-native edge computing and event processing are keys to most carrier cloud initiatives. But they need to make their story stronger, more direct.
VMware obviously wants to be strong in the carrier cloud space, but they are also going at the mission with perhaps too much subtlety. Their centerpiece is the Virtual Cloud Network, which earns a highlight position on their website’s homepage. As I noted in my blog on the topic last week, this is a solid effort to frame logical application networking from the server/application side. That’s incredibly important for carrier cloud because every application driver needs it.
Red Hat doesn’t have a home-grown strategy for logical/application networking, which is one reason they should have highlighted the Nuage/Accenture pitch. VMware could make a lot of hay with Virtual Cloud Network, perhaps even enough to overcome the fact that operators are less likely to see VMware as a natural open platform for carrier cloud than Red Hat.
You might wonder about HPE in this mix, and frankly I wonder too. In one sense, HPE has the same challenge as Dell, with a hardware business to defend when the world is really mostly about software. But HPE was a leading player in the early days of NFV. They fumbled their opportunity and rather than dusting themselves off, they seem to have forgotten about the carrier cloud space. Today, they have fewer mentions among operator planners than the other two competitors we’re covering in this blog. They do have a good hybrid cloud management tool, but they don’t seem to be driving toward a unified hybrid solution.
Is there some central truth driving this? I think so, and it’s unity of virtualization. You can’t virtualize one thing in the IT universe and hope to come out with an optimum outcome. It’s all or nothing, and we are heading toward a universal facing of that truth. Hybrid cloud, multi-cloud, carrier cloud, edge, core, compute, networking, software—everything has to be virtual, and it will be. Things like Mesos and DC/OS, which represent virtualizing infrastructure in a more general way, would seem to me to be the high ground on one side, and virtual/cloud/logical networking would be the other. No major player has a solid footing in the former, but VMware seems more determined than others to seize the latter.
Which leads to the competitive question of who’s winning here, and there’s no clear answer yet. Right now, I’d say that VMware’s Virtual Cloud Networking concept is the best productized embodiment of the critical unity-of-virtualization shift, among the major vendors. Red Hat should have nailed something down on its own, but what they’d need to do now is to create a virtual network ecosystem and try to draw in players besides Nokia/Nuage, who probably wouldn’t want to put all their carrier eggs in the Red Hat basket at this point. HPE has a greenfield opportunity, but they might be growing only weeds.
The deciding factor in this competition, and perhaps in the whole of the hardware/software debate, might be Dell. They could create a stronger symbiosis with VMware, but of course doing that could erode their power to play with other software giants, including Red Hat. If they decide that independence is a stronger play, it’s my view that they’re saying that hardware cannot, in the long run, sustain itself against commoditization pressure. Software wins.
What does that do for innovation? Software is more agile, more feature-rich, but we’re also seeing a push toward open-source on the software side. Part of the problem with NFV is the desire of vendors to earn as much licensing VNFs as they did on the appliances the VNFs were based on. Operators are already pushing for things like ONAP, partly because they embody the goals of things like NFV better, but also partly because they distrust vendors. Can we innovate with open-source? Some say Linux is proof we can, but Linux is an open-source implementation of the POSIX APIs. So is POSIX proof of innovation? That’s based on UNIX. The fact that we can trace the roots back so far may tell us that it’s the business model of open source that’s innovative, not necessarily the technology.
In the end, the buyer will decide. Operators are shifting their focus to open source, but they’re not driving the projects effectively. Enterprises are still more willing to accept proprietary solutions, particularly for vertical-market software. Open source, open hardware, will be undergoing a trial of fire in the next couple of years, and what emerges will probably define not only whether Red Hat or VMware wins, but what our industry will end up looking like in a decade.