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Are We Surprised Cisco Will Build Cloud Computing Servers to Compete With HP, Dell, et al?

Posted by Bob Warfield on January 20, 2009

A fascinating article from the NY Times just hit Techmeme.  It’s all about how Cisco is planning to start building servers.  To be precise, servers equipped with virtualization software.

The article expresses some surprise at this move, but it seems terribly obvious now that the news is out.  After all, there is already a move afoot to create Cloud Servers.  These a stripped down machines best suited to doing nothing but being the commoditized ubiquitous guts of some massive Cloud data center where there will be thousands of them.  The emphasis will be on reliability and cost efficiency.  I’ve likened the advantages of such highly standard machines to the business advantage Southwest Airlines gets by standardizing all of their aircraft as 737’s.  Companies like Google have already seen the light and taken these steps.

When you look at a server not as a complex machine optimized for maximum performance, but as an interchangeable box optimized for value and low cost of ownership, doesn’t it suddenly sound a lot more like the boxes Cisco has traditionally been making?  Don’t they know a lot about how to do that sort of thing?  And what did we think was inside those Cisco network boxes anyway?  Surprise, they’re mostly just computers with special software.  Cisco already has a huge leg up on how to do this stuff.

Mind you, these boxes are not strictly for the Cloud, but the vision of highly standardized corporate datacenters where the important thing about the machines is virtualization and efficiency more than absolute maximum throughput is pretty much what the Cloud wants anyway.

It’s going to be interesting to watch, but this isn’t the first or the last time that the Cloud will change the dynamics of the marketplace.

2 Responses to “Are We Surprised Cisco Will Build Cloud Computing Servers to Compete With HP, Dell, et al?”

  1. perpetapaul said

    Bob – you are right when it comes to Cisco knowing how to do something like this.

    One of the issues that is starting to pop up is licensing of software. Adobe is now looking at how we are using their licenses on virtualized servers and trying to come up with licensing that works for all situations. I am sure that Microsoft and others will be doing the same.

    Do you have any insight on how this should be done? We have done some cost/benefit analysis runs to see what would work for us and share that with Adobe (one of our partners). But I am not sure they will like the numbers we are getting!

    Thanks for your continuing, great insight!

  2. smoothspan said

    I’m from the school that says the software license should be tied to actual use, and not some inflated proxy. If I am able to serve 10 users as though they had 10 individual computers by virtue of virtualizing 1 box, I ought to be able to get the same fees for the software as I did for the 10 boxes. That sounds great for some kinds of software, but probably less great for others. I can envision a case where the vendor was charging by cpu and suddenly a lot fewer cpus are needed due to virtualization. It’s really a hard problem for system software.

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