The cloud computing world is hybrid! Is Dell showing us the right direction?

With a clear cut, Dell said good bye to the public cloud and align its cloud computing strategy with own OpenStack-based private cloud solutions, including a cloud service broker for other public cloud providers. At first the move comes surprising, but makes sense when you take a closer look at Dell, whose recent past and especially the current market situation.

Dell’s new cloud strategy

Instead of having an own public cloud offering on the market, Dell will sell OpenStack-based private clouds on Dell hardware and software in the future. With the recent acquisition of cloud management technology Enstratius customers will also be able to deploy their resources to more than 20 public cloud provider.

With a new “partner ecosystem”, which currently consists of three providers and that is further expanded in the future, integration opportunities between the partner’s public clouds and private clouds of Dell customers will be offered. The current partner network includes Joyent, ZeroLag and ScaleMatrix. All three are rather small names in the infrastructure-as-a-service (IaaS) market.

Further, Dell also strengthens its consulting business to show customers which workloads and processes could flow into the public cloud.

Thanks Enstratius, Dell becomes a cloud broker

A view on the current public cloud IaaS market shows that Dell is right with its strategy change. All current IaaS providers of all sizes to chafe in the fight for market share against industry leader Amazon Web Services. Since their innovative strength is limited compared to Amazon and most of them to limit themselves, with the exception of Google and Microsoft, to the provision of pure infrastructure resources (computing power, storage, etc.), the chances of success are rather low. Moreover, into a price war with Amazon the fewest should get involved. That can quickly backfire.

Rather than dealing with Amazon and other public IaaS providers in the boxing ring, Dell positioned itself on the basis of Boomi, Enstratius and other previous acquisitions as a supportive force for cloud service providers and IT departments and provides them with hardware, software and more added values.

In particular, the purchase of Enstratius was a good move and let Dell become a cloud service broker. Enstratius is a toolset for managing cloud infrastructures, including the provisioning, management and automation of applications for – currently 23 – public and private cloud solutions. It should be mentioned that Enstratius in addition to managing a single cloud infrastructure also allows the operation of multi-cloud environments. For this purpose Enstratius can be used as a software-as-a-service and installed in on-premise environments in the own data center as a software.

The cloud computing world is hybrid

Does Dell rise in the range of cloud innovators with this change in strategy? Not by a long shot! Dell is anything but a leader in the cloud market. The trumps in their cloud portfolio are entirely due to acquisitions. But, at the end of the day, that does not matter. To be able to take part in the highly competitive public cloud market, massive investment should have been made ​​that would not have been necessarily promising. Dell has been able to focus on his tried and true strengths and these are primarily in the sale of hardware and software, keyword: “Converged Infrastructures” and the consulting business. With the purchase of cloud integration service Boomi, the recent acquisition of Enstratius and the participation in the OpenStack community externally relevant knowledge was caught up to position itself in the global cloud market. In particular, the Enstratius technology will help Dell to diversify the market and take a leading role as a hybrid cloud broker.

The cloud world is not only public or only private. The truth lies somewhere in the middle and strongly depends on the particular use case of a company, which can be divided into public, private as well as hybrid cloud use cases. In the future, all three variants will be represented within a company. Thereby the private cloud does not necessarily have to be directly connected to a public cloud to span a hybrid cloud. IT departments will play a central role in this case, get back more strongly into focus and act as the company’s own IT service broker. In this role, they have the task of coordinating the use of internal and external cloud services for the respective departments to have an overall view of all cloud services for the whole enterprise. For this purpose, cloud broker services such as Dell’s will support.

By Rene Buest

Rene Buest is Gartner Analyst covering Infrastructure Services & Digital Operations. Prior to that he was Director of Technology Research at Arago, Senior Analyst and Cloud Practice Lead at Crisp Research, Principal Analyst at New Age Disruption and member of the worldwide Gigaom Research Analyst Network. Rene is considered as top cloud computing analyst in Germany and one of the worldwide top analysts in this area. In addition, he is one of the world’s top cloud computing influencers and belongs to the top 100 cloud computing experts on Twitter and Google+. Since the mid-90s he is focused on the strategic use of information technology in businesses and the IT impact on our society as well as disruptive technologies.

Rene Buest is the author of numerous professional technology articles. He regularly writes for well-known IT publications like Computerwoche, CIO Magazin, LANline as well as and is cited in German and international media – including New York Times, Forbes Magazin, Handelsblatt, Frankfurter Allgemeine Zeitung, Wirtschaftswoche, Computerwoche, CIO, Manager Magazin and Harvard Business Manager. Furthermore Rene Buest is speaker and participant of experts rounds. He is founder of and writes about cloud computing, IT infrastructure, technologies, management and strategies. He holds a diploma in computer engineering from the Hochschule Bremen (Dipl.-Informatiker (FH)) as well as a M.Sc. in IT-Management and Information Systems from the FHDW Paderborn.

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