'White Boxes' Help Cut Cost of Building Giant Enterprise Data Centers

The adoption of open hardware produced by original design manufacturers threatens traditional server and networking vendors. But Dell, HP and others are pushing back. 

White Box Hardware 2

Karl Armani knew his software-as-a-service company, Medallia, was going to have to find a new way to run its networks.

Medallia, a provider of customer experience management software and services, currently uses networking gear from Cisco Systems and Arista Networks in its three data centers worldwide. As officials began planning to open three more data centers in 2015, they started looking for networking alternatives that would bring greater automation, better scalability, improved bandwidth and lower costs, according to Karl Armani, senior director of infrastructure and operations at Medallia.

The company explored the growing range of options on the market, from proprietary networking products to low-cost white boxes from original design manufacturers (ODMs), before settling on Dell and its Open Networking initiative, which offers Dell switches that can run third-party operating systems and software.

Since the company already runs Linux and Dell servers in its data centers and uses open-source tools, Medallia was intrigued by the idea of running Cumulus Networks' Linux networking OS on Dell hardware. Throw in the lower costs when compared with the proprietary networking equipment brands and the support and services from a tier-one supplier, and Medallia was sold, Armani told eWEEK.

"We started talking with Dell, and we never looked back," he said.

Medallia's journey shines a light on the rapid changes occurring in all areas of the data center in the wake of the rise of hyperscale data centers, software-defined everything, the growth of cloud environments, big data, social networking and mobility, and the demand from businesses for hardware that is optimized for the workloads they're running.

All that has fueled the growing adoption of white boxes from ODMs in data centers—in servers, networking and storage. Then there are new offerings from established data center tech vendors as they look to push back at the white-box trend by offering organizations a third way to go, which splits the difference between these cheaper and bare-bones ODM products and the more expensive and proprietary hardware resources.

The numbers are putting this trend in context. According to IDC analysts, server ODMs—which include such companies as Foxconn, Quanta, Pegatron and Stack Velocity—that as a group saw revenues in 2014 hit more than $3.9 billion, a 40.5 percent increase from 2013 and more than Cisco and Oracle (the world's fourth- and fifth-largest system vendors) generated. These contractors shipped a combined total of 1.6 million servers worldwide, representing 17.1 percent of the global market and exceeded only by Dell and Hewlett-Packard, IDC noted.

A similar trend is happening in the networking space, where technologies like software-defined networking (SDN) and network-functions virtualization (NFV) make it easier to run networking tasks on lower-cost commodity hardware rather than more expensive and complex switches and routers.

Analysts with Infonetics Research this month found that bare-metal switches—hardware that is not locked into a specific operating system or other software—accounted for 11 percent of the data center ports shipped last year and that number will grow to almost 25 percent by 2019.

"Up till now, bare-metal switching has been attractive mainly to the large cloud service providers (CSPs) like Google and Amazon, who provide their own switch software integrated into data center orchestration and management platforms," Cliff Grossner, research director for data center, cloud and SDN at Infonetics, said in a statement.