IBM Cloud Strategy for Data-Intensive Enterprises

Few weeks back I had an opportunity to speak about IBM Cloud strategy to an enterprise involved in managing and analyzing big data as a core part of their business. Here’s a video recording of an edited version of that presentation. The┬áblog post that follows the video has the slides, the transcription, and the audio of the presentation.

To understand IBM Cloud strategy and its direction it helps to understand the history of where it is coming from. This slide shows examples of the business computing systems that IBM created over the roughly past 100 years.

The horizontal scale is time. The vertical scale is about computer intelligence which is closely related to qualities of data that these systems processed. For example tabulating systems were keeping statistics for US National Census in the early 20th century. At that time, the systems were challenged to deal with volumes on the scale of kilobytes of data.

Now if we fast forward a few decades, the programmable systems that started appearing in 1950s, were very exciting because most of the computers that are around you today, from laptops, tablets to smartphones are examples of the programmable systems that use their own memory to store instruction about how to compute.

The programmable approach worked well when the systems had to work with with megabytes to gigabytes of structured data. But over the past two decades they are increasingly challenged by greater volumes of data on the internet which also comes in greater variety, including natural language text, photos, videos. For example, to beat human champions of the TV show Jeopardy, IBM researchers had to build a new, cognitive system, called IBM Watson, which processed on the order of 10TB of data (TERABYTES that’s 1 followed by 12 zeros), and that was mostly unstructured data from Wikipedia, dictionaries, books.

The increasing velocity of data is also a challenge for many enterprises. Think about streams of twitter messages about gift purchases. Around Christmas time these tweets arrive at faster and faster rates.

The rest of this presentation is about the role that cloud computing and IBM Cloud play in addressing these challeges. Because regardless of whether your business is operating programmable systems that are common today or cognitive systems that are increasingly popular, IBM Cloud can help your company achieve better business outcomes.

IBM Cloud is both the name of the technology and also the name of the cloud computing business unit that IBM is operating since the start of 2015.

Just a few words about the business: it had high double digit growth every quarter since the unit was launched. Today, IBM Cloud is used by over 30,000 customers around the world and 47 out of Fortune 50 companies. According to some analysts, IBM Cloud is the largest hybrid cloud provider by revenue. Forrester released a study earlier this year, saying that IBM technology is the top choice for enterprises that want to build hybrid clouds that need to span multiple vendors, for example, clouds that include services from IBM’s Softlayer and also Amazon’s AWS, and Microsoft Azure. IDC, another independent analyst firm ranked IBM as #1 at helping enterprises transition to cloud.

So why do enterprises want to work with IBM Cloud? IBM offers clients an open cloud architecture to run their IT solutions. As illustrated on this slide, IT solutions are built from software, software needs comprehensive and flexible platforms, and plaforms need a resilient infrastructure. Enterprises also have a spectrum of LEGACY systems and applications, so they need to have a choice of where to tap into this stack, which can be anywhere from the infrastructure layer where IBM offers a choice of virtual servers, storage, or even bare metal hardware; to the solutions layer, for capabilities like the IBM Watson cognitive system that helps with unstructured data.

Our clients also want a choice of delivery models, whether public, to take advantage of the economies of scale possible when sharing infrastructure with other customers; dedicated, a delivery model where a customer gets their own, private cloud instance on an isolated infrastructure on IBM’s premises; or a local delivery model, where an IBM cloud in deployed to a client’s own infrastructure behind the client’s firewall.

With so many choices, IBM Cloud is designed to ensure a consistent experience for clients. In fact, IBM has over 500 developers working on the open standards architecture and the platform to support consistency in delivery and in service management.

IBM also stands out in the marketplace as an open, hybrid cloud with a focus on enterprise grade requirements. For example, Gartner recognized IBM as the leader in cloud disaster recovery services, and notably AWS and Microsoft are absent from the upper right quadrant.

As enterprises migrate to cloud, it is important to ensure that the migration does not disrupt existing backup and disaster recovery plans. This problem of backup and disaster recovery is compounded by the fact that cloud’s ease of use can often result in IT organizations managing 1,000s or in some cases 10,000s of virtual servers, because it is so simple to create them in the cloud.

IBM offers a scalable endpoint management capability to keep these virtual servers, secure with latest patches and updates, keep them up to date on backups, and ready in case of disaster recovery events. And again to the point of consistency, IBM can provide endpoint management regardless of whether the virtual server is deployed to IBM Softlayer, to AWS or to Microsoft Azure.

Many enterprises have complex audit and compliance requirements. IBM Cloud can offer fine grained auditability of the underlying hardware used to run enterprise workloads. For example, IBM Cloud can provide the details about the hardware used for an application, including everything from the rack location in an IBM’s data center, down to the serial number and the firmware version.

IBM Cloud is also designed to securely integrate and to interoperate with existing, legacy infrastructure and solutions used by enterprises. IBM has over 40 data centers worldwide, close to existing infrastructure of many of IBM’s customers worldwide. IBM partnered with leading telecommunications providers to ensure that it is possible to setup a direct and secure network link from customer’s premises to an IBM data center.

IBM has a long history of defining and influencing open standards and open source software. For example in 2000 IBM put the Linux operating systems on the map of many enterprises when IBM committed to invest $1B in Linux support.

Similarly in the cloud space, IBM is a key player in the most influential open source projects. For instance, IBM is a board member of the Openstack foundation where IBM is working with companies like AT&T and Intel to advance an open standard around cloud infrastructure, including compute, storage and networking.

In the platform as a service space, IBM is working with Cloud Foundry and Docker projects to advance a set of open standards for cloud application portability.

So why should enterprises care that their cloud investments back an open architecture? Because it is tied to a culture of productivity in IT organizations. For example Docker can help introduce a culture of agile IT to developers and operations in an enterprise. To illustrate this with an example, at this year’s IBM Interconnect conference we had an IBM Cloud customer called Monetize that does digital transactions in Europe talking about pushing 78 changes to their application a day. I work with CIOs of large enterprises that tell me that they don’t do 78 changes to their applications a year!

In addition to having a more productive IT workforce, investing in open also means that an enterprise has the freedom of switching to a different cloud vendor. Open standards help ensure portability of workloads in the cloud and thus help avoid vendor lock-in.

All right, so we’ve spend some time on technology and now let’s bring the focus back on business and talk how IBM Cloud can work with capabilities like mobile and social to help enterprises achieve better business outcomes.

At IBM we use this phase: API Economy. It refers to the part of the economy where commercial transactions are executed digitally over interfaces that exist in the cloud. API stands for application programming interface, and APIs is how an enterprise can participate in this economy by unlocking the value of its data, insights, competencies, business services and making them accessible to third parties or even within the enteprise. According to some estimates, by 2018, the API Economy will become a $2.2 trillion dollar market.

IBM is uniquely positioned to help our clients to achieve better business outcomes in the API Economy. IBM Cloud helps enterprises run both legacy and cloud native applications more effectively to help generate insights from data. This is possible with technologies like Spark which are available as a service from IBM Cloud. Cognitive technologies like IBM Watson are also available to help with with analysis of unstructured data like natural language text, or photos and videos.

IBM Cloud can help enterprises monetize data and insights about data by helping to build, run, and manage applications that publish the API to enterprise’s customers. Beyond that, an enterprise can also use IBM Cloud to deliver mobile applications to its customers, to provide them with user experiences that drive the use of the APIs. The APIs can also be integrated into social, for example to provide personalized experiences for users of social networks like Twitter or Facebook.

Ultimately what’s so exciting about the API Economy and as illustrated on this slide, is that an enterprise can use the APIs to create a virtous cycle, such that insights about data can be exposed and monetized via APIs, and then the data streams about the mobile and social uses of the APIs, can in turn generate better insights about the enterprise’s customers, accelerating this cycle.