Star Wars Big Time Vendor Rivalries
This one’s been kicking up for some time now, beginning years’ back when several prominent Microsoft executives defected to Google when it was still a young upstart. The battle royale takes place on several fronts, most publicly in the search market where Google owns 65 percent market share. Microsoft’s new search engine Bing is still a distant third with 9 percent market share, but has gained ground over the summer. Microsoft’s forthcoming search alliance with Yahoo, No. 2 in the space, is expected to further toss a stake in the ground against Google when it comes to fruition next year.
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It’s taken awhile, but corporate users have begun to wake up to the fact that they can get decent functionality and security from Web-based Google Apps. With Microsoft Office owning more than 90 percent of the productivity applications market, Google and its brethren have a long way to go. Nonetheless, Microsoft isn’t dismissing the potential threat; in July it released free Web versions of Office.
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Ah, Cisco. They surprised quite a few when they announced a rack-mount server in June. Not the least of which was HP. HP CEO Mark Hurd has not minced words about his distaste for Cisco entering what by all accounts is a commoditized market that is pretty much owned by HP, IBM and Dell. Cisco, meanwhile, insists its server strategy doesn’t touch where the big guys now play, but is rather a complementary product optimized for the company’s full Unified Computing System. In other words, meant for all-Cisco environments.
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Cisco’s server gambit has set in motion a flurry of competitive tit for tats in the networking arena where it has long been king. After years operating as a kind of satellite to the mother ship, HP’s ProCurve division has been brought into the main fold, and at No. 2 in the core networking infrastructure market is being pushed heavily by HP. Cisco has noticed; CEO John Chambers has declared no lost deals to ProCurve and several VARs report that Cisco uncharacteristically has begun price-matching ProCurve. Likewise, IBM, which shed its networking business many years back, has reasserted its presence there by tightening its resale alliances with Cisco rivals Juniper and Brocade.
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VMware is synonymous with virtualization technology and the clear market leader, but Microsoft, along with other players is looking to toss a stake in the ground in this market as well. Microsoft is coming out with Hyper-V R2, which will now feature Live Migration capabilities that some pundits believe will put this virtual server technology on the same level as VMware.
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Two words: Data Domain. The corporate tug-of-war between NetApp and EMC to outbid and acquire deduplication specialist Data Domain provided juicy industry fodder this summer. In the end, EMC and its fat all-cash wallet won the prize, doling out $2.1 billion. NetApp, which first initiated the acquisition bid, retreated and while it’s impossible to say for certain, one has to wonder if the recent changing of the guard at the CEO position there, with Dan Warmenhoven stepping down into another role at the company, might not have been a bit of fallout from the failed purchase.
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Can any one vendor own the cloud? Not likely, but if there’s one technology area that nearly every infrastructure player from Google to NetApp, Microsoft to Amazon.com is vying for dominance. Microsoft has been pitching its forthcoming Azure platform as its cloud solution, but many of its partners are still leery of a somewhat-unclear business model for the channel. One partner described Azure as incredibly cool technology, but not much good for partners if a demonstrable revenue model isn’t in place. What’s going to be incredibly cool looking ahead is to see where solution providers will align themselves as they move their own applications and other solutions to the cloud. Let the games begin.
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This is all about unified communications. Microsoft is pushing its Office Communications Server and SharePoint platforms and a client-based software approach to this market that features a raft of technologies from VoIP to collaboration software. Cisco, for its part, is unsurprisingly pinning its UC strategy around the core network and building out from there. From a solution provider perspective, it’s a lucrative market to enter, but one that also requires a high degree of skill, both technical and sales. Looking ahead, Microsoft and Cisco are battling to attract the best and the brightest to their side.
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Security is another technology genre that’s being affected by convergence, with the broad infrastructure players such as Cisco and Microsoft in the game now. But there are still best-of-breed battles ongoing. Take Symantec and McAfee. Security giant Symantec is still trying to recover from years of missteps since acquiring Veritas, while McAfee is getting its act together on several fronts, including its recent acquisition of MX Logic for managed services presence, alliances with EMC for backup and HP for reselling products, and new channel leadership.
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The broadline distributors have struggled with the economy. But while Tech Data’s revenues fell 16 percent year over year, they were up 4 percent sequentially, an indication of things maybe getting a little better. And on the earnings side Tech Data reported a 59 percent increase in net income. By comparison Ingram Micro’s most recent earnings show year over year revenues down 25 percent and a 2 percent sequential decline. Both distributors have said they’ve walked away from deals where the pricing wasn’t right. But still, it seems like one of these companies may be doing better than the other one in terms of performance during the recession.
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There are other rivalries, some classic, some heating up again after a period of détente. Some of the most notable:Oracle vs. IBM: Database warriors from way back, these two ended up in the same headline this year when IBM backed out of a deal to buy Sun Microsystems and Oracle anted up instead..Intel vs. AMD: This rivalry has ebbed and flowed over the years, but is heating up again.Dell vs. the Channel: Dell wants to project channel-friendliness, but still butts up against its own partners in the field.HP vs. IBM: Just who is the ultimate king of the mountain among the technology vendors?