Not on the Dell/EMC Bandwagon. More of the same. OpenPOWER changes the game!

Reading articles about the two companies consummation on 9/7/16 around social media yesterday, one would think the marriage included a new product or solution which was revolutionizing the industry.  I haven’t heard of any but  I do know that both companies have continued to shed employee’s and sell off assets not core to the go-forward business to capture critical capital to fund the massive $63B deal.  They will also continue to evaluate products from both Dell & EMC’s traditional product portfolios to phase out, merge, sell or kill due to redundancies and other reasons.  It just happens. For them to say otherwise is misleading at best.  Frankly, it hurts their credibility when they deny this as there are examples already of this occurring.

Going forward I do not see how the combined products of Dell, which at its core sell commodity Intel servers that are not even best of breed, but rather the low-cost leader paired with the high-end products from EMC, which had high development cost will be any different on 9/8/16 than it was on 9/6/16.  EMC’s problem of customers moving away from the high margin high-end storage systems to the highly competitive, lower margin All Flash Array products will not be any better for the newly combined company.  This AFA space has many good competitors who offer “Good Enough” features that can offer clients 1) Lower cost 2) Comparable or better features 3) Not a tier-1 player who some customers resist due to feeling they overpay for the privilege to work with them.

About 2 years ago, EMC absorbed VCE with its Converged infrastructure called vBlock, a term I argue it is not but instead is a Integrated Infrastructure built on VMware, Cisco UCS and EMC Storage.  VMware & EMC storage offer nothing unique. UCS is unique in the Intel space but with the messy split from the VCE tri-union and now VCE who is placing a lot of emphasis on their own hyper-converged offerings as well as products from Dell due to this new found marriage.  It only makes sense to de-emphasize Cisco from a VCE solution and start promoting Dell products.  This goes from using the leader in Intel blade solutions to the “me-too” Dell products which is average in a field of “Good Enough” technology whose most notable feature is its low cost.

As I listen to the IBM announcement today that include 3 new OpenPOWER servers I can’t help but wonder how much longer Dell’s low cost advantage will remain.  Not sure what they will use for SAP HANA workloads requiring > 4 socket Intel servers since HPE just bought SGI, primarily for its 32 socket Intel server/technology.  I guess they could partner with Lenovo on their x3950 or with Cisco on their C880 which I believe they actually OEM from Hitachi. Dell servers are woefully inadequate with regard to RAS features; not just against POWER servers but even against other Intel competitors like Lenovo (thanks to their IBM purchase of xSeries), Hitachi and Fujitsu who all have stronger offerings relative to what Dell offers.   RAS features simply cost more which is why you didn’t see IBM with its xSeries, Hitachi or Fujitsu be volume leaders. This is also why you are seeing more software defined solutions built to mask hardware deficiencies. This in itself has its own problems.

Here is a quick review of today’s announcements. The first server is a 2 socket 2U server built for Big Data hosting 12 internal front facing drive slots.  The next server is a 2 socket 1U server offering almost 7K threads in a 42U rack.  It provides tremendous performance for clients looking for data-rich and dense computing.  The 3rd server is a 2 socket 2U server that is the first commercial system to offer NVIDIA‘s NVLink technology connecting 2 or 4 GPU’s directly to each other as well as to the CPU’s.  Every connection is 160 GB/s bi-directional which is roughly 5X what is available on Intel servers using GPU’s connected to PCIe3 adapter slots.

openpower_family_sept2016

These OpenPOWER systems allow clients to build their own solution or as part of a integrated product with storage and management stack built on OpenStack.  Ideal for Big Data, Analytics, HPC, Cloud, DevOps and open source workloads like SugarCRM, NoSQL, MariaDB, PostgreSQL (I like EnterpriseDB for support) or even IBM’s vast software portfolio such as DB2 v11.1.

Pricing for the 3 new OpenPOWER models as well as the first 2 announced earlier in the year is available at Scale-out Linux on page. I recently did a pricing comparison for a customer with several 2 socket Dell servers vs a comparable 2 socket S822LC.  Both the list and web price for the Dell solution were more expensive than OpenPOWER.  The Dell list price was approximately 35% more and the web list price was 10% more and I was using the price as shown on the IBM OpenPOWER page provided in the link in this same paragraph.  Clients looking to deploy large clusters, compute farms or simply want to start lowering infrastructure cost should take a hard look at OpenPOWER.  If you can install Linux on an Intel server,  you have the skills to manage a OpenPOWER server.  Rocket Scientist need not apply!

If you have questions, encourage you to contact your local or favorite business partner.  If you do not have one, I would be happy to work with you.

Intel Vendors & VMware have a Oracle Problem

Houston, we have a problem!

Intel server vendors Dell, VCE, HPE, Cisco, Lenovo, Fujitsu, Hitachi, Huawei, white box vendor Super Micro and any other server vendor using Intel chipsets have a problem if their customers use VMware to host Oracle Enterprise products (ie Database).

What’s “their” problem

In a nutshell, Oracle’s position is that customers running their Enterprise products like Oracle Enterprise Edition Database,  licensed by core (all cores in the server x 0.5) in a VMware environment must license every core on every server in which that Oracle workload could ever potentially reside managed by vCenter.  Server vendors, VMware, consultants and so on have a vested interest for Oracle to not do this because this Oracle tax is an extreme approach with their licensing terms that concern customers if they are running Oracle on Intel servers for fear Oracle will initiate a LMS audit leading to a substantial license settlement.

Quick Background

In my previous blog I wrote about “Intel; the Great Charade” where I discuss  each new generation of Intel processors having less performance per core than the previous generation.  As you read this and the ones referenced in this article (VCE & HoB) keep this ‘per core’ licensing approach in mind as this topic is central to how Oracle (typically) licenses its enterprise products.  For example, if a clients current server models are Sandy Bridge or Ivy Bridge era servers and plan to upgrade to the latest generation Broadwell you actually decrease the per core performance while increasing the number of cores per socket (if staying with the same SKU). Meaning 12 Ivy Bridge cores requires a little over 13 rounded up to 14 Broadwell cores to deliver equal performance. You don’t upgrade to get equal performance so you now have to move to a 16 or maybe 18 core SKU to gain additional socket performance or go with a higher frequency & lower core per socket SKU to obtain receive more performance per core….but now do you have enough overall performance?  To summarize my previous blog: It takes more cores from Haswell or Broadwell to equal the performance of the previous generation chips.  Since this increase in performance is at the socket and not with the core or thread (where most databases almost almost always prefer a stronger core vs more cores let alone weaker cores in a socket).  Since Oracle’s license calculation on Intel is to license all of cores in the server x 0.5 you may end up buying 1 or 2 extra Oracle licenses for every upgraded Intel server running VMware so be sure to factor that into your budget.

Who is complaining?

I could write the rest of this blog on this topic alone; around the right and wrong of Oracle’s licensing methods in VMware environments but I’ll defer to the thousands already available on this very topic.  This is not the reason I am writing this blog but to call out the self-serving and irresponsible Call-to-Action from House of Bricks and leader of a major CI player; VCE and to discuss why Oracle has no incentive to stop doing what they are doing.

Chad Sakac, the President of VCE which is the the Converged Infrastructure (CI) arm of EMC and soon Dell as the acquisition of EMC should be complete any day.  He is a regular blogger and in my opinion a master of marketing, technology & motivation.  On August 17, 2016 Chad wrote a blog titled “Oracle, I’m sad about you, disappointed in you, and frustrated with you.” in which he lays out how Intel server customers running Oracle Enterprise products, most often Oracle Enterprise Edition Database, are fed-up with Oracle’s abusive licensing tactics when Oracle Enterprise Edition products are installed and running in VMware.  He passionately pleads years of Oracle licensing frustration on behalf of clients while challenging clients to stand up to Oracle and not let them be bullied anymore.  He admits to selfishly partnering with House of Bricks (HoB), a VCE partner by funding their analysis on this situation.  HoB has been a leading voice in this fight in there own right so receiving compensation from VCE check was the proverbial icing on the cake IMHO as they were fighting the fight anyway.  What is VCE’s angle? They either have, or are losing  business due to clients fear of running Oracle workloads using VMware vSphere & vCenter.  There must be enough business at stake or EMC / VCE is desperate enough (not being critical here, just observing) to force them down this path to take such a in your face approach to Oracle.

House of Bricks, who is VCE’s partner and author of the whitepaper had a generally fair and moderated tone throughout the whitepaper.  That said, I do find they are irresponsible by encouraging VMware customers who are running  Oracle Enterprise Edition products licensed by core/processor (not socket or NUP) to run in configurations which are in direct conflict with Oracle’s standard licensing practices.  I’m not arguing the merits, fairness or legality of those licensing practices so save your comments.

Fight Mr Customer So We Can Sell You More!

Simply stated, Chad Sakac, the President of VCE and House of Bricks are actively encouraging system administrators, DBA’s and IT organizations to not only defend your use of Oracle Enterprise products in VMware environments, VMware clusters and VMware environments managed under vCenter but also to license Intel servers using sub-capacity licensing, using the BIOS to limit access to sockets or cores, only license the cores being used by Oracle.  Do these things and stand up to Oracle.  Do it for you….do it for us….just do it!  Of course, VCE funded the HoB paper but they won’t be funding your legal case (or bills) with Oracle.  All of this “encouragement” while at the same time promoting EMC / VMware / VCE products in lieu of traditional Oracle availability & replication products seems a little disingenuous…maybe….why not just keep your argument on the complaint of Oracle licensing with VMware?.  But instead, among many “do this instead of that” statements such as liminating Oracle RAC and use VMware HA and consider EMC RecoverPoint / SRDF in lieu of Oracle Active Data Guard (ADG).

Multiple agenda’s

Much of the HoB whitepaper feels like a marketing slick for EMC / VCE products. Then to have Chad be the front man out front crying on behalf of all customers seems a little too self-serving.

My Good Buddy Larry

Now back to Oracle….everybody knows I am NO Oracle fan.  A good day is any day I beat Oracle (anybody beats Oracle) or reduces their revenue.  But, with regard to Oracle’s practices on how they license their Enterprise products in a VMware environment, they have ZERO (0) motivation to loosen their licensing rules given Intel’s continued growth in the marketplace – Oracle is in the drivers seat!  Oracle wants customers to buy infrastructure from them running OracleVM with Oracle Linux hosting the Oracle software stack.  Oracle receives ALL of the Sales & Support dollars this way.  In addition to this, Oracle is predisposed to litigate.  Larry likes to fight!  HP and now HPE, SAP, Google (2 suits, going to a 3rd), Rimini Street, Oregon Healthcare, Mars and many more.  The Oracle v Mars case is a recent example of how Oracle goes after customers using their License Management Service (LMS) group to drive license revenue thru audits.  “Mars stated that Oracle was unwilling to “come to a mutually agreeable process” for completing an audit. Oracle then sent Mars a letter stating Mars had materially breached its license agreement”.  The greatest leverage clients have is to move off of Oracle products (hardware & software) to alternative solutions; specifically database variants such as IBM DB2, Microsoft SQL Server or Open Source alternative PostgreSQL from EnterpriseDB not to mention the many NoSQL alternatives that probably do a far better job.

Alternatives

If VCE really wanted to partner with an enterprise quality commercial-grade database technology to help clients run VMware with sub-capacity licensing for just the servers where the workloads are running and find an alternative to Oracle, they should look at IBM’s DB2 . DB2 is available in multiple editions from a free edition to Advanced Enterprise Server Edition.  What makes it different and better than both Oracle or SQL Server is that AESE, for example, includes many of the products & features that a client desires of Oracle Enterprise Edition products yet have to pay for À la carte.  DB2’s AESE cost $56,210 (list price for 70 PVU) per license which would match up against the Oracle Enterprise Edition portfolio which when you add up those products cost over $225K (Note: DB2 ESE is a level down from AESE, cost less and probably meets 90% of the customers requirements so the story just gets better).  DB2 always includes its first year of maintenance then 20% each year thereafter while Oracle always charges 22% for the first year then 22% each year thereafter.  Of course, DB2 runs 2X faster with Linux on POWER vs Intel. Clients can try it out for free in SoftLayer for 30 days running Linux on a OpenPOWER server.  Since LoP isn’t the topic of this blog, I’ll save that for another day but know that at least both Intel with VMware and IBM POWER servers support sub-capacity licensing with virtualization.

DB2-S822LC-vs-HPDL380

I didn’t write this blog to be a shill for IBM’s DB2 either, it just came to me as I was reading the HoB paper as it felt like they were trying to slyly present SQL Server as a more agreeable alternative to Oracle – maybe they are … either way thought I would mention DB2 for some balance.

There is ONE Platform …

At the end of the day, clients have a choice if they run Oracle products such as PeopleSoft, JD Edwards, Oracle Apps, Oracle E-Business Suite (EBS) or standalone Oracle Enterprise products like Database, RAC, WebLogic and many others.  Clients can run Oracle on Intel with VMware then surely deal with the risk and issues discussed by Chad and House of Bricks OR clients could run Oracle on the only platform which controls Oracle licensing without all of the consternation, debate and angst; IBM POWER servers running AIX.  For those who have read this far and were begging to say “But POWER servers have a core license factor 2X of  Intel so they cost twice as much”.  Enough please! I may hire House of Bricks to write a paper to put an end to this FUD, myth and farce. With POWER8 outperforming Intel servers generally around 2X per core it eliminates this argument right here. But, since we are talking about licensing a product at the core level it is important to remember that POWER servers support sub-capacity licensing natively, without debate from Oracle.  Last and most importantly, IBM’s Power Hypervisor suite, called PowerVM manages the compute resources more efficiently where it scales the 2X performance per core advantage typically increasing it up to 4X, 8X, 12X, even 20X (your mileage will vary).  This isn’t a performance advantage as much as it is an efficiency statement.  I call it the “Total Cost of Efficiency” as it takes into account the TCA, Performance advantage & Hypervisor efficiency and depending on the discussion, years 2-5 maintenance which is TCO.  I have personally sized, architected and delivered these solutions to customers who have in turn realized these very savings.

Now the Call-to-Action!

If you believe VMware & Intel are a critical part of your business identity that make your products better then continue using them with your Oracle products. You will pay more (compared to POWER) due to lower performance & less efficiency and pay the Oracle tax.  If you view IT as an enabler to your bottom line and use the right tool for the job then give me a call as I can help you as I have helped dozens of others save $100K’s to $M’s with IBM server technology.   Oh, and for those last few sharpshooters who want to remark that IBM servers are more expensive go ahead and save your comment.  First, I’ll shut you down by comparing a proper IBM server with the class of Intel server that you present me.  Next, we won’t go the 1 for 1 server route. As I recently showed a customer a reduction of 24 x Dell servers with 596 cores or 298 Oracle licenses to 7 x POWER8 servers with 168 cores and Oracle Licenses. My 7 servers are far less expensive than your 24 servers  not to mention the infrastructure required to support it (power cables, LAN/SAN cables, switch ports, cooling, etc). What makes me different is I show you how it’s possible to save  significant money running Oracle on IBM servers. What makes Ciber different is we have an Oracle consulting practice to help you implement, migrate or optimize your environment.

Will a Dell acquisition of EMC be another HP-Compaq disaster?

There is a feeding frenzy on the M&A speculation regarding Dell buying EMC.  How much will it cost, who is impacted and how big of an impact it will be?  Although the speculation is interesting, the 800 lb gorilla in the room is “What’s going on at EMC” to warrant this.

Working  in IT sales, I work and compete with EMC and their partner organizations; primarily VCE and VMware and their recently divorced partner, Cisco.  Following EMC and VMware at their respective vendor conferences; EMC World and VMworld they have an extremely large and dedicated following.  EMC sellers are some of the most aggressive and by extension successful compared to vendors.  I personally follow many of their technologist on social media reading their blogs and tweets – I view them as a very formidable competitor and occasional partner (even though I am not EMC’s biggest fan).

Why does a company whose products and partnerships are either #1 or leading in their respective areas desperate to find a company to acquire or possibly merge with them? It was shocking to hear HP’s name mentioned over a year ago.  They are an absolute train wreck as we now see.  If I was an EMC company officer or board member, I would not want to see my company consumed by the likes of HP.  Cisco makes sense but I don’t know how deep the recent divorce and hurt feeling goes.  Lenovo doesn’t make sense, nor Hitachi.  Fujitsu….well, they have their Oracle relationship and they seem content to with who and what they are? What about Oracle….EMC as a company has its own ego, I don’t think Larry’s ego and EMC’s ego would mesh. Although, Oracle’s storage is abysmal and this would elevate them to the leaders quadrant immediately. Maybe that would give Oracle the needed reason to finally kill off SPARC given its unending failures. How about IBM? Frankly, they have a great storage portfolio, they simply do not have comparable storage sellers to EMC. EMC’s software would fall into IBM’s vast portfolio then either rise to the top or fade into oblivion. I could see this making sense for IBM but don’t know if IBM has the stomach to ingest a company with such a different culture.  From Dell’s perspective, an EMC acquisition makes sense.  I see them having their most success in the SMB and academic markets then probably state and local governments.  At least in the US with corporate America, Dell is not a respected enterprise brand.  Buying EMC would give them immediate credibility, access to many customers data centers they are not in today.  They would have to decide what to do with their Compellent and EqualLogic products. I would probably keep the EqualLogic product family as it seems to service their low end SMB space, a space that I don’t think EMC cares much about.  Sell Compellent to get cash for the investments made as well as to strengthen the books.

From EMC’s perspective, they would be acquired by a company known for inexpensive laptops and decent desktops (How’s that market doing these days?) and reselling Lexmark printers (who makes them now?).  Only in the last couple of years do I occasionally hear Compellent’s name being mentioned and it is usually to smaller shops with lots of VMware….let’s say shops that aren’t very sophisticated. Their is still a relationship with Cisco both with EMC to Cisco but also with vBlocks.  VMware has their EVO:Rail and Dell has their partnership with Nutanix.  Lastly, their is VMware.  Here’s the irony of what is going on: Some people want EMC to spin off VMware while others want EMC to keep them to strengthen and shore up the Federation.  If the stories are right, Dell would buy EMC then sell off VMware to reclaim much of its acquisition cost.

We will  soon see if there is any truth to the rumors about Dell acquiring EMC. if they are true, will this be a repeat of what happened to HP after merging with Compaq (HPQ after all)?  They failed to integrate the many technologies and companies over two decades.  Some cost a fortune and often the cultures were vastly different.  HP is different from both Dell and EMC in that they made one bad M&A decision after another.  DEC, Tandem, Compaq, Autonomy, 3PAR, 3COM and Palm (just from memory).

Maybe a Dell acquisition of EMC makes sense but it will take a couple of years to see what products survive and what doesn’t. This of course will be disconcerting to customers who have invested in their respective technologies. IBM was often the source of FUD attacks claiming the end of every one of their businesses as well.  It is my contention that is how they have made it to 100+ years.  I hope we will hear someday what was really going on at EMC to warrant their ongoing search for a suitor.  The last mega merger of a commodity company to a enterprise company didn’t turn out so well: HPQ!