.NET Developers May Be IBM's Big Prize in New Cloud Deal With Microsoft

By Darryl K. Taft  |  Posted 2014-10-22 Print this article Print
IBM Microsoft Azure

“The deal looks like additional proof -- following on Monday's announcement of Microsoft's deal with Dell to produce a cloud computing appliance -- that the company is ratcheting up its efforts to promote Azure for hybrid cloud computing implementations,” said Charles King, principal analyst at Pund-IT. “Frankly, Microsoft has been behind the curve in this regard so pursuing enterprise-facing partners makes good strategic sense. Working with IBM should help Microsoft ensure that business customers ready for hybrid cloud will be able to access Windows Server, SQL Server and Hyper-V solutions via IBM SoftLayer. The deal also benefits IBM by expanding Microsoft Azure customers' access to its core middleware offerings -- WebSphere, MQ and DB2. Overall, both stand to gain by working harmoniously together.”

The partnership between IBM and Microsoft is just one more example of “coopetition” between industry leaders. Ironically, earlier this year, Steve Mill, senior vice president and group executive for Software & Systems at IBM, told eWEEK he viewed Microsoft’s Azure PaaS as a key competitor in the PaaS space. Now the two are working together.

IBM has been partnering with companies across the industry in the cloud. In addition to Microsoft, IBM has struck partnerships with a number of industry leaders including SAP, Intel, CSC and AT&T among others to capitalize on the emergence of hybrid cloud for the enterprise.

Meanwhile, during Microsoft’s own Azure cloud announcement on Oct. 20, Guthrie said Microsoft’s view is that there are only three companies capable of delivering cloud computing to the enterprise at scale on an ongoing basis: Microsoft, Amazon Web Services and Google. No mention of IBM.

“Guthrie's comment seems shortsighted to me,” King said. “The way IBM's cloud solutions are gaining market traction, particularly among enterprise customers supports that. But the company recently entered into other significant cloud partnerships, including agreements with SAP and Ingram Micro. Finally, I think it's important to remember that we're still in early days in how and where businesses are adopting cloud. Suggesting that Microsoft, Google and Amazon are the obvious winners is like calling a race when the horses have just hit the first turn.”

IBM also had a bit to say on the matter.

“The investments that IBM has made in cloud computing and the corresponding results speak for themselves,” Michael Curry, IBM’s vice president of WebSphere software, told eWEEK. “In the last year and a half, IBM placed a big bet on SoftLayer and has since made it the foundation of our expansive cloud portfolio; we announced a $1.2 billion investment to build 15 new data centers, bringing our global reach to 40 cloud data centers in 15 countries and every major financial market around the world; we invested $1 billion in launching a new Watson Business unit with Watson running on SoftLayer; we invested $1 billion to build an open-standards based platform-as-a-service with Bluemix; we launched the IBM cloud marketplace to deliver a simple and easy cloud buying experience for the enterprise and we have launched numerous new SaaS applications.”

Moreover, IBM thoroughly understands the needs of its enterprise customer base and has invested heavily in expanding its SoftLayer cloud infrastructure to facilitate those transitions, King noted. “There's also proof that its approach is working,” he said. “On Monday, during what was a pretty disappointing earnings call, IBM noted that its overall cloud revenues had grown 50 percent over the past year and that cloud services – SoftLayer -- were up 80 percent with a $3.1 billion run rate.”


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