Welcome!

Weblogic Authors: Yeshim Deniz, Elizabeth White, Michael Meiner, Michael Bushong, Avi Rosenthal

Blog Feed Post

The Third Epoch: Re-verticalization of IT

The shift from the mainframe to modern epochs in IT infrastructure has been well documented numerous times. Depending on the particular storyteller, the tale starts with deeply-integrated, vertical stacks that encompass everything from compute to networking in large systems that required small armies of people to deploy and manage.

As technology matured and the Internet exploded, what were once integrated functions were broken out into standalone components. This led to the second real epoch in IT infrastructure, most notable because it gave birth to the best of breeders.

This second epoch has served us well. We saw the birth of new architectures. We have perched upon new performance peaks. We have mastered new capabilities that have transformed the whole of IT. And because we are cobbling together our solutions from standalone components, we have been able to do all of this while we customize the architecture to suit our sometimes very unique needs.

But all of that has come at a cost: namely, complexity. We might experience that complexity firsthand in the form of policy madness. Or we might be secondhand consumers, choosing to deal with it by paying for service integration. Whichever we choose, we ultimately pay in one way or another.

The costs of infrastructure assembly—both time and money—are already shaping the market. Efforts like VCE and Exadata are good indicators of a change in how infrastructure and applications are consumed. Rather than relying on specialists who integrate products upon delivery, some customers are choosing to purchase already-integrated solutions.

The distinction here is integration as a service vs. integration as part of a product. In the former, integration is the outcome of some effort that happens after a product is shipped. In the latter, integration is an actual part of the product. The difference between the two might seem subtle, but it is important in terms of how the market will evolve.

If you believe that buying patterns will shift more towards a re-verticalization of IT, then individual constituents in the current IT stack will ultimately align to a relatively small number of overarching IT providers. You won’t have an integration layer in the market that handles this function (or more precisely, that layer becomes much smaller).

Today there is a swath of resellers and systems integrators that perform this integration function. In a re-verticalized market, the large suppliers handle the integration burden by assembling products that are already integrated and providing both the services and support around the final infrastructure as a whole.

This makes perfect business sense because right now those large players are leaving money on the table. If they can act as their own integrators, they can keep pricing low (essentially lowering prices but maintaining margins by cutting out the supplier in the middle).

Of course, this is not a transition that everyone can make. The largest suppliers have the customer relationships to pull this off. The smaller suppliers do not have the product center of gravity, and they lack the customer reach to operate at the kind of scale necessary to dominate.

These dynamics form the major case behind the mass consolidation of infrastructure suppliers, and arguably this is why Cisco’s CEO John Chambers has both set Cisco’s targets on being the number 1 IT supplier, and predicted a brutal consolidation of the networking space.

It is conceivable that the market can only support a small number of very large companies. Oracle and Cisco would seem poised to do well here, as would companies like HP. Dell is interesting depending on what other steps they take from a solutions perspective. IBM and maybe even companies like Intel start to look interesting.

There will be very large companies that end up on the outside looking in. It would not be surprising to see multi-billion-dollar companies struggle to grow in a changing environment like this. They might not outright die (epochs in IT are measured in decades, not individual years), but they could see a radical tapering of growth, which typically leads to other issues (talent, product pipeline, and so on).

Now while this new epoch of IT might be characterized by the mega suppliers, it won’t be only the large players that have a role. It is possible to deliver components as part of an integrated solution. But the platforms themselves will be fundamentally different, which means the next epoch components must be designed with a different endgame in mind.

The question is really about how companies exist in the second epoch while simultaneously preparing for the third. This is nontrivial – enough so that it deserves its own (future) blog post.

[Today’s fun fact: The first lighthouse to use electricity was the Statue of Liberty. Come on, baby, light my fire.]

The post The Third Epoch: Re-verticalization of IT appeared first on Plexxi.

Read the original blog entry...

More Stories By Michael Bushong

The best marketing efforts leverage deep technology understanding with a highly-approachable means of communicating. Plexxi's Vice President of Marketing Michael Bushong has acquired these skills having spent 12 years at Juniper Networks where he led product management, product strategy and product marketing organizations for Juniper's flagship operating system, Junos. Michael spent the last several years at Juniper leading their SDN efforts across both service provider and enterprise markets. Prior to Juniper, Michael spent time at database supplier Sybase, and ASIC design tool companies Synopsis and Magma Design Automation. Michael's undergraduate work at the University of California Berkeley in advanced fluid mechanics and heat transfer lend new meaning to the marketing phrase "This isn't rocket science."

IoT & Smart Cities Stories
René Bostic is the Technical VP of the IBM Cloud Unit in North America. Enjoying her career with IBM during the modern millennial technological era, she is an expert in cloud computing, DevOps and emerging cloud technologies such as Blockchain. Her strengths and core competencies include a proven record of accomplishments in consensus building at all levels to assess, plan, and implement enterprise and cloud computing solutions. René is a member of the Society of Women Engineers (SWE) and a m...
Early Bird Registration Discount Expires on August 31, 2018 Conference Registration Link ▸ HERE. Pick from all 200 sessions in all 10 tracks, plus 22 Keynotes & General Sessions! Lunch is served two days. EXPIRES AUGUST 31, 2018. Ticket prices: ($1,295-Aug 31) ($1,495-Oct 31) ($1,995-Nov 12) ($2,500-Walk-in)
IoT is rapidly becoming mainstream as more and more investments are made into the platforms and technology. As this movement continues to expand and gain momentum it creates a massive wall of noise that can be difficult to sift through. Unfortunately, this inevitably makes IoT less approachable for people to get started with and can hamper efforts to integrate this key technology into your own portfolio. There are so many connected products already in place today with many hundreds more on the h...
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
Business professionals no longer wonder if they'll migrate to the cloud; it's now a matter of when. The cloud environment has proved to be a major force in transitioning to an agile business model that enables quick decisions and fast implementation that solidify customer relationships. And when the cloud is combined with the power of cognitive computing, it drives innovation and transformation that achieves astounding competitive advantage.
Machine learning has taken residence at our cities' cores and now we can finally have "smart cities." Cities are a collection of buildings made to provide the structure and safety necessary for people to function, create and survive. Buildings are a pool of ever-changing performance data from large automated systems such as heating and cooling to the people that live and work within them. Through machine learning, buildings can optimize performance, reduce costs, and improve occupant comfort by ...
Charles Araujo is an industry analyst, internationally recognized authority on the Digital Enterprise and author of The Quantum Age of IT: Why Everything You Know About IT is About to Change. As Principal Analyst with Intellyx, he writes, speaks and advises organizations on how to navigate through this time of disruption. He is also the founder of The Institute for Digital Transformation and a sought after keynote speaker. He has been a regular contributor to both InformationWeek and CIO Insight...
Digital Transformation: Preparing Cloud & IoT Security for the Age of Artificial Intelligence. As automation and artificial intelligence (AI) power solution development and delivery, many businesses need to build backend cloud capabilities. Well-poised organizations, marketing smart devices with AI and BlockChain capabilities prepare to refine compliance and regulatory capabilities in 2018. Volumes of health, financial, technical and privacy data, along with tightening compliance requirements by...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
Nicolas Fierro is CEO of MIMIR Blockchain Solutions. He is a programmer, technologist, and operations dev who has worked with Ethereum and blockchain since 2014. His knowledge in blockchain dates to when he performed dev ops services to the Ethereum Foundation as one the privileged few developers to work with the original core team in Switzerland.