Industry Brief HP Rallies the Channel

around Converged Infrastructure

Featuring

Avnet HP Partner Summit 2012

HP Converged Systems

Where IT perceptions are reality

Copyright 2012© IT Brand Pulse. All rights reserved. Document # INDUSTRY2012004 v3 May, 2012

Avnet HP Partner Summit 2012

Summit Overview

The epic migration to fabric compu-

ting and converged infrastructure is

underway. As we stand at the

threshold of the biggest technology

inflection in 20 years, a new set of

capabilities are needed for HP and

its partners to seize incumbency in

this new IT marketplace. The Avnet

HP Partner Summit 2012 was the

latest event where HP rallied the

channel to help lay the foundation

for the company’s success in the

next 75 years.

Avnet, Inc., which generated reve-

nue of over $27 billion in fiscal 2011,

is one of HP’s largest distributors. HP,

with $127 billion of revenue in fiscal

2011, drove 60% of that revenue through 172,000 resellers around the world. From May 15-17, 2012, the

two giants hosted upwards of 300 attendees, including top HP resellers, at the Wild Horse Pass Resort just

outside Phoenix, Arizona.

Delivering the HP keynote on Thursday morning was Dave Donatelli, Executive Vice President and General

Manager of the newly named HP Enterprise group which includes Enterprise Servers, Storage, Networking

and Technology Services.

While the theme of the event was, “The Art of Business Transformation,” Mr. Donatelli narrowed the focus

on transforming the capabilities of HP and its partners to lead in delivery of converged infrastructure.

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Server, storage and network piece-parts architected,

integrated and deployed in application silos.

Discrete Infrastructure

Dave Donatelli, EVP and GM of the HP Enterprise group rallied top HP partners to trans-

form their capabilities from integrating components for islands of application-specific IT, to

delivering converged infrastructure for computing fabrics.

The Current Generation of Data Center Infrastructure was Introduced

Mr. Donatelli framed the challenge HP part-

ners face in building a converged infrastruc-

ture practice. He did this by reminding his

keynote audience the current generation of

data center infrastructure was developed 20-

30 years ago.

During that time, IT organizations enlisted

HP partners to architect and deploy infra-

structure tailored for specific software appli-

cations like CRM, Email, and HR. The results

are “discrete” data centers with islands of

application-specific IT resources.

Another result is HP resellers became ex-

perts at developing their own solution blue-

prints which define server, storage, network-

ing and service building blocks down to the

disk drive, server adapter and transceiver used.

Mr. Donatelli suggests that customer require-

ments are changing; and they’re changing fast. IT organizations are aligning with trusted advisors who can

help them migrate to fabric computing architectures and products, while bridging private cloud services re-

siding in-house, with public cloud services.

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Server, storage and network piece-parts integrated into

converged systems which are deployed as pods in a com-

puting grid.

Converged Infrastructure

Over 20 Years Ago

As we enter the era of hybrid clouds and grid computing, technologies re-

fined over the last 30 years for discrete data centers will give way to con-

verged systems for virtualized environments.

Fabric Computing

As virtualized environments become the norm, the industry is moving to configure these pools of resources

into interconnected nodes that look like a fabric when viewed collectively. In the next 20 years, grid compu-

ting fabrics will become the foundation of enterprise IT architectures.

Converged Systems

The building blocks for computing fabrics are converged systems which are pre-integrated, tested, and opti-

mized infrastructure solutions for applications running in virtual, cloud, dedicated, or hybrid environments.

The HP portfolio of Converged Systems include AppSystems, CloudSystem and VirtualSystem which simplify

the deployment and optimization of application environments by integrating hardware, software, and ser-

vices into turnkey solutions.

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VS1, VS2 and VS3 systems meld HP converged infrastruc-

ture with VMware vSphere 5.

VirtualSystem For VMware

The Next 20 Years

HP Converged Systems

Drumbeat of New Products

With a sense of urgency that is driven from the

top, HP is re-tooling its product lines and channel

programs to succeed in the legacy market for dis-

crete infrastructure and in the new market for

converged systems.

During the last year HP has maintained a drum-

beat of new product introductions. All these

products combined, amounted to a major refresh

of its server, networking and storage product

lines including powerful new HP Gen8 servers,

3PAR 10000 storage systems, and ProCurve net-

working products.

The new products simultaneously serve to en-

hance AppSystems, VirtualSystem, CloudSystem

and StorOnce converged systems.

Training the Trainers

If HP partners are expected to guide IT organiza-

tions to become IT service brokers, then some-

one must train HP’s partners. To help HP partners

transition from delivering discrete infrastructure

to converged infrastructure, HP is investing heav-

ily in the Pathway to the Clouds training program.

It was reported at the Partner Summit that over

1,000 partners have already attended a Pathway to

the Clouds event.

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Architects and manages highly automated delivery of re-

sources from a computing fabric—typically a hybrid cloud

environment.

Strategic Service Broker

Re-Tooling

HP has mapped out the integration between cloud and existing infrastruc-

ture so its partners can help IT organizations architect a hybrid cloud envi-

ronment. Source: HP.com

HP has also defined a 5-step process for partners to help IT organizations

transform into “Strategic Service Brokers.” Typically a hybrid cloud envi-

ronment, these service brokers will be capable of automated delivery of

resources from their computing fabric. Source: HP.com

Before & After

Today HP partners use their experience and expertise to develop custom solution blueprints. A typical partner with a server virtual-

ization practice will take into consideration hundreds of components for their recommended server, storage and networking sys-

tems. When HP and its partners transform their capabilities, partners will use their grid computing / hybrid cloud systems experi-

ence and expertise to add simplified blueprints using converged systems as the major building blocks.

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Hardware, software and services for a specific application such as

CAE, CRM, HR, email, file server, web server, etc.

Solution Blueprint

A New Blueprint

In the future, successful HP partners will guide customers to fabric

computing using converged systems, like this HP VirtualSystem, as

building blocks.

HP resellers have become experts at developing solution blue

prints which define server, storage and networking building blocks

down to the disk drive, server adapter and transceiver used.

Virtualized Server Blueprint—Before Virtualized Server Blueprint—After

Lower IT Costs, Higher Uptime, and Faster Deployment

According to a recent report from IDC, the payoffs to IT for increased convergence are dramatically lower IT

Costs, higher uptime, and faster deployment. As an IT organization progresses from a traditional (discrete)

architecture, to an adaptively sourced model: uptime approach five-nines of availability, mean time to deploy

is cut from 20 days to 5 days, and annual IT costs per Gbps of workload throughput drop from $25,000 to less

than $1,000.

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Organizations have optimized IT infrastructure as far as possible

given currently available technology and are technically capable

of offering cloud services.

Adaptively Sourced

The Payoff for IT

According to IDC, Traditional and Compartmentalized (Level 1) organizations have only begun to initiate convergence. Stand-ardized and Optimized (Levels 2 and 3) organizations have implemented many of the best practices but are just realizing bene-fits such as lower infrastructure costs and IT productivity improvements. Automated and Adaptively Sourced (Levels 4 and 5) organizations have optimized IT infrastructure as far as possible given currently available technology and are technically capa-ble of offering cloud services.

Effect of Increased Convergence Levels on IT

Costs, Uptime, and Speed of Deployment (Source: IDC)

Availability

Mean Time to Deploy

New Services (Days)

Annual IT Costs (000) per

Gbps Workload Throughput

An Engine for Growth

According to a recent forecast by Wikibon, worldwide spending on legacy (discrete) hardware will decline at

almost 12% per year through 2017. Conversely, for partners looking for a growth engine, the forecast for Sin-

gle SKU Hardware and Reference Architecture Hardware will grow at over 50% per year.

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2011-2017 growth rate for spending on single SKU hardware. 63.2% CAGR

The Payoff for Partners

The payoff for HP partners who excel in delivering Single SKU hardware and Reference Architecture Hardware (Converged

Systems) is high growth for several years to come.

Converged Infrastructure Forecast (Source: Wikibon)

WW Hardware Spending (Billions) 2011 2017 CAGR

Legacy Hardware $110 $52 -11.90%

Single SKU Hardware $1.20 $22 63.20%

Reference Architecture Hardware $5.90 $74 52.50%

Total $117 $148

Storage $36 $44 3.10%

Server $61 $78 4.30%

Network $20 $26 4.30%

Total $117 $148

Resources

The Bottom Line

The opportunity is huge, the stakes are high, and HP has the strategy to establish early incumbency in the

new market for fabric computing and converged infrastructure. However, I talked to several partners at the

Summit, and regarding HP converged systems, some were asking, “isn’t that what we do?” The bottom line is

I expect HP to focus its resources on partners who make the biggest impact on making HP’s vision a reality.

Related Links To learn more about the companies, technologies, and products mentioned in this report, visit the following web pages: HP Converged Systems Wikibon: Converged Infrastructure Takes the Market by Storm IDC: Measuring the Business Value of Converged Infrastructure in the Data Center IT Brand Pulse About the Author

Frank Berry is founder and senior analyst for IT Brand Pulse, a trusted source of data and analysis about IT infrastructure, including servers, storage and networking. As former vice president of product marketing and corporate marketing for QLogic, and vice presi-dent of worldwide marketing for the automated tape library (ATL) division of Quantum, Mr. Berry has over 30 years experience in the development and marketing of IT infra-structure. If you have any questions or comments about this report, contact frank.berry@itbrandpulse.com.

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