EMC is betting that its VMware virtualization platform will ride a strong wave of hybrid cloud deployments to drive robust business growth in 2011.
Joe Tucci, EMC’s CEO and chairman, repeatedly emphasized the company’s positioning in cloud computing during an analyst briefing in Boston on Feb. 8. Since EMC’s last analyst event in 2009, cloud computing has evolved from being just a buzzword everyone was using to become the next “big game-changing” technology that will make enterprises more nimble and efficient, he said.
“No segment of the industry will be immune to this disruption,” he said. EMC “recognized the opportunity early” and realigned the business to meet anticipated customer demand, he said. “Looking back, we got it right,” he said.
Companies are on a “journey to the cloud,” with the hybrid cloud as the eventual goal, Tucci said. Companies virtualize tier 2 and tier 3 applications in the first phase and their mission-critical applications in the second phase of the cloud journey, he said. IT as a service will be the last phase, freeing up companies to shift IT spending toward new technology instead of maintaining current infrastructure, he said.
“We’re in a great position in storage for the cloud,” Tucci said Feb. 8. “We’re focusing our whole strategy on how to become the company that takes our customers on this journey to benefit from IT as a service.”
Customers are saying things are too complex, too inefficient, too inflexible and too costly, Tucci said. IT managers have to support too many operating systems and customized applications within their data centers. “Almost three-quarters of IT spending is on maintaining existing applications in existing infrastructure,” Tucci said.
EMC has identified several “megatrends” within IT and communications, such as the popularity of mobile devices and mass connectivity, the shift toward virtualization and the explosion of information and data, he said. These trends are driving tremendous growth in the data storage industry as companies search for efficient ways to store and access “big data,” he said.
The amount of data is poised to explode “44 times” in 10 years, to more than 40 zettabytes of data by 2020, Tucci said. For comparison, there is about 1.23 zettabytes of data today, he said.
There’s an “intersection” between enterprise data and cloud, and EMC is “in the middle,” said Pat Gelsinger, president and COO of EMC Information Infrastructure products. The journey to the cloud is a “shared vision” with VMware, he said.
EMC, VMware Poised to Lead Hybrid Cloud Migration in 2011: Tucci
title=EMC Dubs VMware the -Cloud Operating System’}
EMC has the “right cloud credentials” to help customers move through the cloud, driven primarily through its majority ownership of VMware, said Tucci. The company also recently refreshed and expanded its extensive line of products for information storage, protection, security, management and intelligence-all the things customers would need to implement hybrid clouds, according to Tucci.
Companies will be adding more virtualization to data centers, said Paul Maritz, VMware’s CEO. In addition to vSphere, vCenter and vCloud will also play a role in “transforming management” within virtual data centers, he said. Next-generation applications are needed, he said.
The integration of EMC’s storage products and VMware’s virtualization products makes it easier for customers to deploy storage solutions, Gelsinger said. EMC’s storage stack includes file and block storage integrated with vCenter and vStorage, he said. EMC hits all the major requirements in storage, such as unified management, multi-protocol storage, scalability and deduplication and compression technology, he said. The only thing missing was block deduplication technology, but EMC promised it will be part of the product portfolio in the second half of 2011, according to Gelsinger.
EMC has made “big bets in the big data world,” Tucci said. Along with its virtual storage capabilities, EMC will be moving aggressively into the low-end storage space with new products, Gelsinger said. EMC will also rely on its $225 billion Isilon acquisition to strengthen scalable network-attached storage business, he said.
There is a “tipping point” in IT and converged infrastructure is expected to be the fastest growing segment in IT infrastructure, said Gelsinger. EMC is aligning its business model to make getting to the cloud easier for customers, he said.
VMware “crossed the chasm” in 2009, when more applications were deployed on virtual infrastructure than physical, Tucci said. EMC considers vSphere, VMware’s virtualization platform, as the essential cloud operating system, Tucci said. With the move into hybrid clouds, vSphere will become the data center operating system, he said.
There is even room for virtualization in mobile devices, Maritz said, referring to Tucci’s megatrend about mobile devices in the workplace. Employees often use their personal devices to access corporate resources. But their applications and personal data should not be IT’s business, he said. VMware is working on a project to create a separate “island” within the device that’s “owned and controlled by IT” and separated from other applications, he said.
EMC expects IT spending to grow 5 percent to 7 percent in 2011, Tucci said. David Goulden, EMC’s executive vice president and CFO, noted that most analysts are predicting the high end of the range. Gartner is predicting 6.6 percent growth in IT spending, according to Goulden. The bulk of IT spending will focus on server virtualization, security, cloud computing, Windows 7 migration and desktop virtualization, Tucci said.