Welcome!

Websphere Authors: Liz McMillan, Carmen Gonzalez, David H Deans, Elizabeth White, Judith Hurwitz

Blog Feed Post

Lenovo buys IBM's xSeries aka x86 server business, what about EMC?

Lenovo buys IBM's xSeries aka x86 server business, what about EMC?

By Greg Schulz

Storage I/O trends

Lenovo buys IBM's xSeries x86 server business for $2.3B USD, what about EMC?

Once again Lenovo is new owner of some IBM computer technology, this time by acquiring the x86 (e.g. xSeries) server business unit from big blue. Today Lenovo announced its plan to acquire the IBM x86 server storage business unit for $2.3B USD.

Research Triangle Park, North Carolina, and Armonk, New York January 23, 2014

Lenovo (HKSE: 992) (ADR: LNVGY) and IBM (NYSE: IBM) have entered into a definitive agreement in which Lenovo plans to acquire IBMs x86 server business. This includes System x, BladeCenter and Flex System blade servers and switches, x86-based Flex integrated systems, NeXtScale and iDataPlex servers and associated software, blade networking and maintenance operations. The purchase price is approximately US$2.3 billion, approximately two billion of which will be paid in cash and the balance in Lenovo stock.

IBM will retain its System z mainframes, Power Systems, Storage Systems, Power-based Flex servers, and PureApplication and PureData appliances.

Read more here

If you recall (or didn't’t know) around a decade or so ago IBM also spun off its Laptop (e.g. Thinkpads) and workstation business unit to Lenovo after being one of the early PC players (I still have a model XT in my collection along with Mac SE and Newton).

What this means for IBM?

What this means is that IBM is selling off a portion of its systems technology group which is where the servers, storage and related hardware, software technologies report into. Note however that IBM is not selling off its entire server portfolio, only the x86 e.g. Intel/AMD based products that make up the xSeries as well as companion Blade and related systems. This means that IBM is retaining its Power based systems (and processors) that include the pSeries, iSeries and of course the zSeries mainframes  in addition to the storage hardware/software portfolio.

However as part of this announcement, Lenovo is also licensing from IBM the Storwize/V7000 technology as well as Tape, GPFS based scale out file systems used in SONAS and related products that are part of solution bundles tied to the x86 business.

Again to be clear, IBM is not selling off (or at least at this time) Storwize, tape or other technology to Lenovo other than x86 server business. By server business, this means the technology, patents, people, processes, products, sales, marketing, manufacturing, R&D along with other entities that form the business unit, not all that different from when IBM divested the workstation/laptop aka PC business in the past.

Storage I/O trends

What this means for Lenovo?

What Lenovo gets are an immediate (once the deal closes) expansion of their server portfolio including high-density systems for cloud, HPC as well as regular enterprise, not to mention also for SME and SMB. Lenovo also gets blade systems as well as converged systems (server, storage, networking, hardware, software) hence why IBM is also licensing some technology to Lenovo that it is not selling. Lenovo also gets the sales, marketing, design, support and other aspects to also expand their server business. By gaining the server business unit, Lenovo will now be in a place to take on Dell (who was also rumored to be in the market for the IBM servers), as well as HP, Oracle and other x86 system based suppliers.

What about EMC and Lenovo?

Yes, EMC, that storage company who is also a primary owner of VMware, as well as partner with Cisco and Intel in the VCE initiatives, not to mention who also entered into a partnership with Lenovo a year or so ago.

In case you forgot or didn't’t know, EMC after breaking up with Dell, entered into a partnership with Lenovo back in 2012.

This partnership and initiatives included developing servers that in turn EMC could use for their various storage and data appliances which continue to leverage x86 type technology. In addition, that agreement found the EMC Iomega brand transitioning over into the Lenovo line-up for both domestic North America, as well as international including the chinese market. Hence I have an older Iomega IX4 that says EMC, and a newer one that says EMC/Lenovo, also note that at CES a few weeks ago, some new Iomega products were announced.

In checking with Lenovo today, they indicated that it is business as usual and no changes with or to the EMC partnership.

Via email from Lenovo spokesperson today:

A key piece to Lenovo's Enterprise strategy has always included strong partnerships. In fact today's announcements reinforce that strategy very clearly.

Given the new scale, footprint and Enterprise credibility that this server acquisition affords Lenovo, we see great opportunity in offering complimentary storage offerings to new and existing customers.

Lenovo's partnership with EMC is multifaceted and stays in-tact as an important part of Lenovo's overall strategy to offer customers compelling solutions built on world-class technology.

Lenovo will continue to offer Lenovo/EMC NAS products from our joint venture as well as resell EMC stand-alone storage platforms.

IBM Storwize storage and other products are integral to the in-scope platforms and solutions we acquired. In order to ensure continuity of business and the best customer experience we will partner with IBM for storage products as well.

We believe this is a great opportunity for all three companies, but most importantly these partnerships are in place and will remain healthy for the benefit for our customers.

Hence it is my opinion that for now it is business as usual, the IBM x8x business unit has a new home, those people will be getting new email addresses and business cards similar to how some of their associates did when the PC group was sold off a few years ago.

Otoh, there may also be new products that might become opportunities to be placed into he Lenovo EMC partnership, however that is just my speculation at this time. Likewise while there will be some groups within Lenovo focused on selling the converged Lenovo solutions coming from IBM that may in fact compete with EMC (among others) in some scenarios, that should be no more and hopefully less than what IBM has with their server groups at times competing with themselves.

Storage I/O trends

What does this mean for Cisco, Dell, HP and others?

For Cisco, instead of competing with one of their OEMs (e.g. IBM) for networking equipment (note IBM also owns some of its own networking), the server competition shifts to Lenovo who is also a Cisco partner (its called coopitition), and perhaps business as usual in many areas. For Dell, in the mid-market space, things could get interesting and the Round Rock folks need to get creative and beyond VRTX.

For HP, this is where IMHO it's going to get really interesting as Lenovo gets things transitioned. Near-term, HP could have a disruptive upper hand, however longer-term, HP has to get their A-Game on. Oracle is in the game as are a bunch of others from Fujitsu to SuperMicro to outside of North America and in particular china there is also Huawei. Back to EMC and VCE, while I expect the Cisco partnership to stay, I also see a wild card where EMC can leverage their Lenovo partnership into more markets, while Cisco continues to move into storage and other adjacent areas (e.g. more coopitition).

What this means now and going forward?

Thus this is as much about enterprise, SME, SMB as it is HPC, cloud and high-density where the game is about volume. Likewise there is also the convergence or data infrastructure angle combing server, storage, networking hardware, software and services.

One of the things I have noticed about Lenovo as a customer using ThinkPads for over 13 years now (not the same one) is that while they are affordable, instead of simply cutting cost and quality, they seem to have found ways to remove cost which is different then simply cutting to go cheap.

Lenovo X1

Case in point about a year and a half ago I dropped my iPhone on my Lenovo X1 keyboard that is back-lit and broke a key. Calling Lenovo after trying to find a replacement key on the web, they said no worries and next morning a new keyboard for the laptop was on my doorstep by 10:30Am with instructions on how to remove the old, put in the new, and do the RMA, no questions asked (read more about this here).

The reason I mention that story about my X1 laptop is that it ties to what I'm curious and watching with their soon to be expanded new server business.

Will they go in and simply look to reduce cost by making cuts from design to manufacturing to part quality, service and support, or, find ways to remove complexity and cost while providing more value?

Now I wonder whose technology will join my HP and Dell systems to fill some empty rack space in the not so distant future to support growth?

Time will tell, congratulations to Lenovo and the IBMers who now have a new home best wishes.

Ok, nuff said

Cheers gs

Greg Schulz - Author Cloud and Virtual Data Storage Networking (CRC Press), The Green and Virtual Data Center (CRC Press) and Resilient Storage Networks (Elsevier)
twitter @storageio

All Comments, (C) and (TM) belong to their owners/posters, Other content (C) Copyright 2006-2014

Read the original blog entry...

More Stories By Greg Schulz

Greg Schulz is founder of the Server and StorageIO (StorageIO) Group, an IT industry analyst and consultancy firm. Greg has worked with various server operating systems along with storage and networking software tools, hardware and services. Greg has worked as a programmer, systems administrator, disaster recovery consultant, and storage and capacity planner for various IT organizations. He has worked for various vendors before joining an industry analyst firm and later forming StorageIO.

In addition to his analyst and consulting research duties, Schulz has published over a thousand articles, tips, reports and white papers and is a sought after popular speaker at events around the world. Greg is also author of the books Resilient Storage Network (Elsevier) and The Green and Virtual Data Center (CRC). His blog is at www.storageioblog.com and he can also be found on twitter @storageio.

@ThingsExpo Stories
What exactly is a cognitive application? In her session at 16th Cloud Expo, Ashley Hathaway, Product Manager at IBM Watson, will look at the services being offered by the IBM Watson Developer Cloud and what that means for developers and Big Data. She'll explore how IBM Watson and its partnerships will continue to grow and help define what it means to be a cognitive service, as well as take a look at the offerings on Bluemix. She will also check out how Watson and the Alchemy API team up to offer disruptive APIs to developers.
SYS-CON Events announced today that Site24x7, the cloud infrastructure monitoring service, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Site24x7 is a cloud infrastructure monitoring service that helps monitor the uptime and performance of websites, online applications, servers, mobile websites and custom APIs. The monitoring is done from 50+ locations across the world and from various wireless carriers, thus providing a global perspective of the end-user experience. Site24x7 supports monitoring H...
The Workspace-as-a-Service (WaaS) market will grow to $6.4B by 2018. In his session at 16th Cloud Expo, Seth Bostock, CEO of IndependenceIT, will begin by walking the audience through the evolution of Workspace as-a-Service, where it is now vs. where it going. To look beyond the desktop we must understand exactly what WaaS is, who the users are, and where it is going in the future. IT departments, ISVs and service providers must look to workflow and automation capabilities to adapt to growing demand and the rapidly changing workspace model.
SYS-CON Events announced today that SafeLogic has been named “Bag Sponsor” of SYS-CON's 16th International Cloud Expo® New York, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. SafeLogic provides security products for applications in mobile and server/appliance environments. SafeLogic’s flagship product CryptoComply is a FIPS 140-2 validated cryptographic engine designed to secure data on servers, workstations, appliances, mobile devices, and in the Cloud.
SYS-CON Events announced today that Akana, formerly SOA Software, has been named “Bronze Sponsor” of SYS-CON's 16th International Cloud Expo® New York, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. Akana’s comprehensive suite of API Management, API Security, Integrated SOA Governance, and Cloud Integration solutions helps businesses accelerate digital transformation by securely extending their reach across multiple channels – mobile, cloud and Internet of Things. Akana enables enterprises to share data as APIs, connect and integrate applications, drive part...
SYS-CON Events announced today that Open Data Centers (ODC), a carrier-neutral colocation provider, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. Open Data Centers is a carrier-neutral data center operator in New Jersey and New York City offering alternative connectivity options for carriers, service providers and enterprise customers.
SYS-CON Events announced today that Dyn, the worldwide leader in Internet Performance, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Dyn is a cloud-based Internet Performance company. Dyn helps companies monitor, control, and optimize online infrastructure for an exceptional end-user experience. Through a world-class network and unrivaled, objective intelligence into Internet conditions, Dyn ensures traffic gets delivered faster, safer, and more reliably than ever.
SYS-CON Events announced today that Vicom Computer Services, Inc., a provider of technology and service solutions, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. They are located at booth #427. Vicom Computer Services, Inc. is a progressive leader in the technology industry for over 30 years. Headquartered in the NY Metropolitan area. Vicom provides products and services based on today’s requirements around Unified Networks, Cloud Computing strategies, Virtualization around Software defined Data Ce...
DevOps tends to focus on the relationship between Dev and Ops, putting an emphasis on the ops and application infrastructure. But that’s changing with microservices architectures. In her session at DevOps Summit, Lori MacVittie, Evangelist for F5 Networks, will focus on how microservices are changing the underlying architectures needed to scale, secure and deliver applications based on highly distributed (micro) services and why that means an expansion into “the network” for DevOps.
The 3rd International @ThingsExpo, co-located with the 16th International Cloud Expo – to be held June 9-11, 2015, at the Javits Center in New York City, NY – is now accepting Hackathon proposals. Hackathon sponsorship benefits include general brand exposure and increasing engagement with the developer ecosystem. At Cloud Expo 2014 Silicon Valley, IBM held the Bluemix Developer Playground on November 5 and ElasticBox held the DevOps Hackathon on November 6. Both events took place on the expo floor. The Bluemix Developer Playground, for developers of all levels, highlighted the ease of use of...
DevOps Summit 2015 New York, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that it is now accepting Keynote Proposals. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development cycles that produce software that is obsolete at launch. DevOps may be disruptive, but it is essential.
SYS-CON Events announced today that Gridstore™, the leader in hyper-converged infrastructure purpose-built to optimize Microsoft workloads, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Gridstore™ is the leader in hyper-converged infrastructure purpose-built for Microsoft workloads and designed to accelerate applications in virtualized environments. Gridstore’s hyper-converged infrastructure is the industry’s first all flash version of HyperConverged Appliances that include both compute and storag...
SYS-CON Events announced today that AIC, a leading provider of OEM/ODM server and storage solutions, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. AIC is a leading provider of both standard OTS, off-the-shelf, and OEM/ODM server and storage solutions. With expert in-house design capabilities, validation, manufacturing and production, AIC's broad selection of products are highly flexible and are configurable to any form factor or custom configuration. AIC leads the industry with nearly 20 years of ...
We heard for many years how developing nations would be able to develop mobile-phone networks quickly, perhaps even leapfrog developed nations, because their lack of traditional, wired networks would not inhibit them from deploying the new technology. Now there is talk of history repeating itself with the Industrial Internet--a key aspect of the emerging Internet of Things. For example, Guo Ping, Deputy Chairman of the Board of Chinese electronics giant Huawei, said in a recent report from the World Economic Forum, "The Industrial Internet will afford emerging markets a unique opportunity ...
Avnet, Inc. has announced that it ranked No. 4 on the InformationWeek Elite 100 – a list of the top business technology innovators in the U.S. Avnet was recognized for the development of an innovative cloud-based training system that serves as the foundation for Avnet Academy – the company’s education and training organization focused on technical training around top IT vendor technologies. The development of this system allowed Avnet to quickly expand its IT-related training capabilities around the world, while creating a new service that Avnet and its IT solution providers can offer to their...
Ayla Networks, whose agile Internet of Things (IoT) platform makes it easy for manufacturers to deliver secure, connected products, today announced it has been included in the list of "Cool Vendors" in the Internet of Things report by Gartner, Inc. “Gartner knows how important it is that manufacturers of all kinds of products have the right IoT solution to help turn their products into connected ‘things,’” said David Friedman, CEO and co-founder of Ayla Networks. “The market for Ayla’s IoT platform has accelerated dramatically this year compared to last year. Today’s largest manufacturers ar...
SYS-CON Events announced today that B2Cloud, a provider of enterprise resource planning software, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. B2cloud develops the software you need. They have the ideal tools to help you work with your clients. B2Cloud’s main solutions include AGIS – ERP, CLOHC, AGIS – Invoice, and IZUM
The Internet of Things Maturity Model (IoTMM) is a qualitative method to gauge the growth and increasing impact of IoT capabilities in an IT environment from both a business and technology perspective. In his session at @ThingsExpo, Tony Shan will first scan the IoT landscape and investigate the major challenges and barriers. The key areas of consideration are identified to get started with IoT journey. He will then pinpoint the need of a tool for effective IoT adoption and implementation, which leads to IoTMM in which five maturity levels are defined: Advanced, Dynamic, Optimized, Primitive,...
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY., and the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides private all-in-one social intranets allowing workers to securely collaborate from anywhere in the world and from any device. Social, mobile, and easy to use. MangoApps has been named a "Market Leader" by Ovum Research and a "Cool Vendor" by Gartner...
The world's leading Cloud event, Cloud Expo has launched Microservices Journal on the SYS-CON.com portal, featuring over 19,000 original articles, news stories, features, and blog entries. DevOps Journal is focused on this critical enterprise IT topic in the world of cloud computing. Microservices Journal offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. Follow new article posts on Twitter at @MicroservicesE