What Does Cisco's Server Strategy Mean For Partners?


Cisco's Unified Computing System, which combines its networking prowess with virtualization and a new blade server offering, is going to take a little time for partners to drink in. But once the dust settles, partners said, Cisco's continued assault on the data center will come full circle.

On Monday, Cisco pulled the curtain off of its Unified Computing System (UCS), a solution set that ties together the network, servers, storage, virtualization and a single management console that the San Jose, Calif.-based networking giant said will turn virtualization on its ear, supporting up to 320 servers and thousands of virtual machines. UCS, coupled with participation from a host of top-shelf technology partners such as BMC, EMC, Intel, Microsoft, VMware and others, essentially seeks to make data centers more cost effective, efficient and flexible, while making virtualization more mainstream.

"We believe the network is at the heart of tying this together," Cisco CEO John Chambers said. "We're looking at this market in terms of bringing virtualization to life, unleashing the power of virtualization."

For Cisco partners, the strategy is just sinking in and will take time to digest. It'll also take time to determine the actual details of Unified Computing, which Cisco offered up Monday as more of an architectural plan of attack than a strict technology play.

"It's a road map vision they have around Unified Computing -- it's much more than a point product," said Bob Olwig, vice president of corporate business development for World Wide Technology, a St. Louis-based solution provider.

While Cisco said Unified Computing will reach into companies ranging from midsize to enterprise, Olwig said he currently sees Unified Computing as a technology set for the big boys.

"In the short term, it will be focused on enterprise accounts and large government agencies," he said.

Still, Cisco taking its networking background and integrating servers and virtualization will open new doors, Olwig said.

"Cisco getting into this blade server space and Unified Computing gives another option to our customers," he said. "Since we already were focusing on virtualization, it only accelerates our growth in the compute and virtualization space."

For partners, the transition to virtualization and computing is similar to the VoIP wave of about five years ago. Partners will have to adapt and learn new skills.

"This is similar to what happened when Cisco got into VoIP," said Zeus Kerravala, senior vice president of analyst firm Yankee Group. "It creates a huge opportunity for the partners, but partners will need to learn new skills in new areas. Virtualization and data center automation, which UCS enables, will have an impact on how applications perform. Partners will need to understand how the server and network interact with one another to create true workload mobility."

John Growdon, Cisco's senior director of go to market for worldwide channels, also pointed to the shifts partners had to make to ready for VoIP, integrating the telecom and networking sides to succeed with a new technology.

"This same thing occurred years ago in the IP telephony space," he said. "These new technologies we're introducing here will cause the exact same effect."

Cisco is gearing up to get partners up to speed on Unified Computing. Currently, Cisco boasts about 250 data center specialized partners, 75 percent of which focus specifically on servers and virtualization, storage and networking, Growdon said. As Cisco's UCS vision evolves, Cisco will launch an Advanced Technology Group around the solution, starting with a subset of between 30 and 50 data center specialized partners.

Cisco also is planning to launch a pair of new individual technical certifications around mid-2009. The data center architect and data center engineer certifications will require partners to have experience in both the networking and storage sides. On the sales side, Cisco will add new training for account managers that will include UCS. It will be layered across the existing Data Center Network Infrastructure and Data Center Storage Networking specializations.

For partners to succeed with UCS, Growdon said, they must evolve their networking, server and virtualization and storage practices and have them speaking one language to form a unified data center practice.

"You have to have competency in all three [technology areas] to really make this work," he said.

Once the initial 30 to 50 partners are brought on board, Growdon said Cisco will go after a broader set of partners that may not possess established practices in all three areas and help them expand their competencies.

Growdon said the challenges for partners will be bringing up staff that's conversant in all three technology areas and on a broader technology set; altering their organizations to push the new technologies to market; and how to compensate individuals that possess the necessary skill sets.

NEXT: Cisco: 'This Is Not About Selling A Server.'
Growdon added that he doesn't see partners having to invest in new personnel to tackle UCS. Instead, they should be able to promote from within.

"The winning strategy is to take your own folks and evolve them into this," he said.

But some partners may not be ready for that evolution. Rich Baldwin, CEO of Nth Generation Computing, a San Diego-based solution provider and partner to both Cisco and Hewlett-Packard, said Cisco is making a classic mistake with its attempt to crack a new market.

"Gosh, Cisco is taking their best partners -- HP, IBM, Dell, Sun -- and pitting themselves against them, since they all are in the blade business," Baldwin said, adding that HP already has a nearly 60 percent share of the blade server market, which will make it hard for Cisco to gain traction there, Baldwin said.

"I don't see where Cisco will ever get the economies of scale to compete with that," he said. "It just seems like they could have invested somewhere else and gotten a better ROI."

Cisco's move is already pushing HP to focus on sales of its ProCurve products over those of Cisco to customers and partners, Baldwin said. "I think Cisco has a lot more to lose than it can gain in this particular situation," he said. "It just doesn't make sense."

Baldwin said he does not anticipate Cisco's blade servers to be of much interest to Nth or to customers.

"Server groups and network groups in big companies tend to be somewhat isolated, or stove-piped," he said. "Standards are already set. I don't think networking guys are going to take over the data center and dictate the server standards where they can bring their friends from Cisco."

Growdon, however, said UCS is not a straight server offering for partners. Partners wanting to offer servers, not an architecture, won't be forced to choose which vendor they side with.

"This is not about selling a server ... this is selling a system," he said. "We're not making a play to get into the server space. The value here is not in selling a server."

Olwig agreed that UCS isn't geared toward knocking out the incumbent server vendors. World Wide Technology has existing partnerships with HP and Sun Microsystems on the server side. Olwig said he doesn't anticipate Cisco's offering will strain his relationship with the competing vendors.

John Marchese, vice president of the systems engineering group for BlueWater Communications Group, a New York solution provider, said Cisco's UCS play really is the "game-changer" Cisco says it is. He said BlueWater will be able to grow out its practice while also tearing down the silos between its different technology groups: storage and virtualization, networking and data center.

"It'll have some challenges, but at the end of the day the silos have been converging already," he said. "The key is, as a VAR, we need to have a solid understanding of the solutions. But we've already built that foundation. We're well-traditioned in that regard."

Marchese said having an existing storage practice and an existing data center practice give BlueWater a leg up.

"It'll help us provide value-add across all lines of business," he said, adding that all three practices will leverage UCS and be able to tell an ROI and TCO story around it. "It's a complementary architecture, not point products, in the data center. It differentiates ourselves from the competition."

Olwig said World Wide Technology will attack UCS from the other side, using it to build on its networking expertise to reach into new markets.

"If it were World Wide three or four years ago, it would be a difficult transition because we were more networking- and core-centric," he said. "If that's your bread and butter, it'd be more difficult to embrace. But this provides us an opportunity to build our networking expertise into new accounts where we haven't been able to do servers. It's going to allow us into some new markets and accounts."

Kerravala added that partners need to embrace Cisco's new direction or risk getting left behind.

"For the network pure-plays, they need to learn the world of computing," Kerravala said. "For the ones that invest the time and resources to do so, it will open the door to more services and opportunity, like VoIP did. For the ones that don't, they'll become dinosaurs and go extinct, like pure voice resellers did."

Joseph F. Kovar contributed to this story.