Dell PowerOne Server Redefines the Cloud Server Conversation

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The Dell Technology Summit was this week, and the most interesting product launched at the event was the new Dell PowerOne server. This offering reminded me of the successful EMC VCE hyper-converged offering of some years back. That model set records in terms of deployment speed, capability, and ease of management but targeted at more of a Web services load be that on-premise or in a Cloud data center.

It is often the case that when a new paradigm emerges like cloud services, we take existing technology initially to address the service requirements. But over time, we learn that something very different is needed. Once that is understood, a leading vendor often creates a bespoke offering tied to the new unique requirements that emerge once that new industry figures them out.

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The PowerOne server appears to be the result of that effort, and I think that it is potentially a game-changer. In a way, it is Dell’s Mainframe. But given Dell’s stature in the industry, and the clear need for a product like PowerOne, I think this offering will create an interesting push to see who can do this better. And IBM could be in a unique position to benefit since they are the only vendor that kept a mainframe (Z System) in their line.

Let’s talk about that this week.

The Evolved Mainframe

You could argue that EMC’s old VCE effort was an update on the IBM Mainframe. Both efforts had lots of IO, but the changes to the networking requirements put a lot of emphasis on the Cisco elements in VCE to provide the scaling that is needed for what was an IT shop in a box solution.

Based on my conversations with shops that have recently discontinued their IBM mainframes, the move wasn’t made because they were unhappy with the product’s performance, security, or management. No, it was because they either lacked the staff to continue to maintain it or, more often, there was a senior staffing change, and the new staff didn’t know the hardware and wanted a solution they knew.

So if those conversations are representative, what IBM has to fix is the lack of trained mainframe operators (a problem they know of and are aggressively addressing) and the lack of comfort for what is now a single vendor solution that many new IT executives don’t know. That last is a much harder thing to fix.

Now the interesting thing about this new PowerOne device is that it appears that its superpower is automation. And in a competition where one of your problems is the lack of trained staff, automation would be one of the places you’d look to find a fix. So, interestingly, the Dell PowerOne effort points the way for IBM to address at least one of their problems with the Z System.

Both Products Have Perception Issues

I noted that one of IBM’s problems is those younger IT managers (I mean non-boomers). These managers, for the most part, don’t trust the IBM mainframe because they don’t know it. That is a perception problem that will be difficult to overcome for a technology company because tech firms tend to underfund and understaff marketing.

On the other hand, the PowerOne is a first-generation product, and IT buyers tend to avoid first-generation products like the plague because they represent too high of failure risk, and were the system to fail, they’d look negligent.

Now the generation one problem Dell has will naturally resolve itself over time when the generation two and three offerings come to market. The IBM problem won’t resolve itself without an effective campaign to get these younger executives to see the advantages of the IBM solution and become comfortable with it and those advantages.

Now that means IBM has a transitory advantage over Dell in terms of perception, while the Dell solution is young. But if IBM doesn’t effectively address the perception problem around their offering by the time Dell’s offering matures, this will reverse, giving Dell an advantage that will increase over time.

The fight between the two companies alone should force IBM to address this lack of comfort issue more aggressively and may mitigate their exposure (we won’t know this until we see the execution).

Wrapping Up: The Real Benefit

Whether we are talking about IBM’s Z System or Dell’s PowerOne, this idea of creating a product uniquely for internal and external cloud loads is a good one. And having competition in this space will allow both respective product teams to play off each other for funding and customer-focused advancement. It should also grow the market for focused products like this, eventually benefiting – assuming both Dell and IBM execute – both vendors.

So, interestingly, even though I expect IBM will look at PowerOne as a threat, it might become a bigger benefit to them over time. Because it will drive interest to the segment, raising the profile of System Z and IBM’s. Plowing this field should help Dell as well. Having both firms focus on this new opportunity will be beneficial for customers as well because it will provide choice, competitive price pressure, and consistent drive towards both automation and maturity.