Vodafone bags Big Blue as $550 million partner

Vodafone Business and IBM have signed-off on a new joint venture which will aim to develop systems to help data and applications flow freely around an organization.

The joint-venture, which will be operational in the first half of 2019, will aim to bring together the expertise of both the parties to solve one of the industry’s biggest challenges; multi-cloud interoperability and the removal of organizational siloes. On one side of the coin you have IBM’s cloud know-how while Vodafone will bring the IoT, 5G and edge computing smarts. A match made in digital transformational heaven.

“IBM has built industry-leading hybrid cloud, AI and security capabilities underpinned by deep industry expertise,” said IBM CEO Ginni Rometty. “Together, IBM and Vodafone will use the power of the hybrid cloud to securely integrate critical business applications, driving business innovation – from agriculture to next-generation retail.”

“Vodafone has successfully established its cloud business to help our customers succeed in a digital world,” said Vodafone CEO Nick Read. “This strategic venture with IBM allows us to focus on our strengths in fixed and mobile technologies, whilst leveraging IBM’s expertise in multi-cloud, AI and services. Through this new venture we’ll accelerate our growth and deepen engagement with our customers while driving radical simplification and efficiency in our business.”

The issue which many organizations are facing today, according to Vodafone, is the complexity of the digital business model. On average, 70% of organizations are operating in as many as 15 different cloud environments, leaning on the individuals USPs of each, but marrying these environments is a complex, but not new, issue.

Back in September, we had the chance to speak to Sachin Sony of Equinix about the emerging Data Transfer Project, an initiative to create interoperability and commonalities between the different cloud environments. The project is currently working to build a common framework with open-source code that can connect any two online service providers, enabling a seamless, direct, user-initiated portability of data between the two platforms This seems to be the same idea which the new IBM/Vodafone partnership is looking to tackle.

With this new joint-venture it’ll be interesting to figure out whether the team can build a proposition which will be any good. Vodafone has promised the new business will operate with a ‘start-up’ mentality, whatever that means when you take away the PR stench, under one roof. Hopefully the walk will be far enough away from each of the parent companies’ offices to ensure the neutral ground can foster genuine innovation.

This is a partnership which has potential. The pair have identified a genuine issue in the industry and are not attempting to solve it alone. Many people will bemoan the number of partnerships in the segment which seem to be nothing more than a feeble attempt to score PR points, but this is an example where expertise is being married to split the spoils.

Nuage updates SD-WAN proposition to tackle multi-cloud complexities

With enterprise IT environments becoming increasingly complex, Nokia’s Nuage Networks has updated its SD-WAN proposition to capitalise on the confusion.

The SD-WAN 2.0 offering is claimed to be an end-to-end network governance solution to manage multi-cloud environments, with complete visibility and control from a single management interface. Nuage Networks Virtualized Network Services (VNS) platform is promised to help customers deliver and orchestrate enterprise IT services across data centres, public cloud services, SaaS provider clouds and enterprise branch sites.

“The industry is on the cusp of a big shift towards SD-WAN,” said Sunil Khandekar, CEO of Nuage Networks. “Unlike other vendors that either have basic connectivity solutions, use proprietary hardware or need to cobble together multiple platforms to address enterprise IT needs, we purposefully developed our VNS offer on a single platform to give our customers a powerful, seamless and consistent set of capabilities across the entire network.”

SD-WAN is seemingly becoming more popular with enterprise IT departments, with IDC forecasting the worldwide market for SD-WAN infrastructure growing compound annual growth rate (CAGR) of 40.4% from 833 million in 2017 to more than 4.5 billion in 2022.

“Network challenges are coming to the fore as organizations worldwide embrace multi-cloud as a means of achieving digital-transformation objectives,” said Brad Casemore of IDC. “Indeed, IDC finds that enterprises are thinking more comprehensively and holistically about how their networks will support the full spectrum of multi-cloud – from on-premises datacenters to IaaS and Saas public clouds and out to the branch offices and remote locations that constitute the intelligent edge.”

Nuage Networks claim first-generation SD-WAN solutions have been limited in scope to automating and managing connectivity of branch offices, which are underserved by IP-VPN services. However, with more businesses migrating to the cloud, the need to provide seamless WAN connectivity also increases. This means connectivity between customer premises equipment at branch and regional sites, as well as to private data centres, SaaS providers and public clouds. It is quickly becoming an increasingly complex tapestry.

Data Transfer Project could cut AWS cloud dominance – Equinix

Amazon’s cloud business, AWS, might be romping ahead of the pretenders in the market share rankings, but the progressing Data Transfer Project could see this lead eroded and the rise of more niche players.

In most sub-sectors of industry, the first to market usually commands a significant market share once the segment has been normalised. The vendor has an established business model, brand and customer base, however this dominance is usually eroded through competition over time. AWS’ position is standing the test of time, though Sachin Sony of Equinix believes the Data Transfer Project could lead to the end of this strangle hold.

“Interoperability between cloud environment will not only be beneficial to customers, but will open up opportunities for more niche providers to establish market share,” said Sony.

“Customers are now dictating the terms, changing the status quo. This is largely driven by the exponential growth in data, especially with IoT and big data, with customers now becoming the dictators on what cloud environment should look like.”

The Data Transfer Project is a collaboration between various organizations to build a common framework with open-source code that can connect any two online service providers, enabling a seamless, direct, user initiated portability of data between the two platforms. In short, it creates interoperability between the provider’s cloud environments to simplify the migration of data between one service and another.

Right now, migration is difficult, which has led to the dominance of the major cloud players. Companies like AWS secure a contract with an organization, but as migration is so difficult, customers are compelled to scale up with the same service. Customer retention becomes simpler, as the options to move are time consuming and expensive, meaning the larger organizations can spend more time securing more customers, who will grow, repeating the cycle.

While it does not sound like the end of the world, because of the difficulties in migrating data, niche service providers struggle to establish themselves. Sony suggested improving interoperability will allow for more resilient multi-cloud environments, where the hyperscale players can be used for more generic activities, and the niche players for more tailored and mission critical business processes. It might also encourage more organizations to transition more data to the cloud.

“When enterprises started moving to the cloud it was a great way to cut costs,” said Sony. “But companies did not think this through.

“When you go to a cloud based environment, you are making yourself captive of that vendor. It’s a very risky business model as it creates a single point of failure. When there have been outages, or the business expanded into new areas where that provider isn’t, complications arise. These organizations need diversification in their cloud environments. They need interoperability.”

Of course, whenever the customer starts dictating terms the big vendors tend to resist, and AWS is not an active contributor to the project at the moment. Why would it want to contribute to something which would destroy its dominant position in the industry? However, Sony thinks it is only a matter of time.

Interoperability is an attractive prospect for the customer as it offers security, resiliency and agility. Cutting costs is not the sole objective of the cloud-orientated business model anymore, therefore customers will look elsewhere at the expense of a couple of dollars should a provider not offer interoperability. It’s only a matter of time before AWS is forced into line.

This is not to say this project will cost AWS money. In theory, it should encourage more organizations to migrate data and more mission critical processes to the cloud, resulting in more business. But, this will be more business for everyone. Interoperability takes cloud from a specialist service to more of a commodity. The specialism will be creating unique and tailored environments, a service which will be offered by the smaller emerging players.

This project and the trend of interoperability will not cost AWS money, but it might cost it market share.