IBM-Apple Strikes in Enterprise Mobility with “AppleCare for Enterprise”

This week, Apple has launched a new AppleCare for Enterprise website as the first output from the Enterprise Mobility Deal that Apple (AAPL) and IBM made in July 2014.

Apple enterprise customers will be able to receive round-the-clock phone support to priority on-site repairs and personalized assistance from Apple experts so that businesses can keep their Apple devices working smoothly.  Each company subscribing to AppleCare for Enterprise will get a “personal liaison” to handle its account, who can respond to urgent issues within an hour. Businesses can sign up for onsite hardware service for either two or three years provided by IBM Global Technology Services.

Customers can also get free replacements for “up to 10 percent” of covered iOS devices — so if one out of 10 of your employees has fumble fingers and cracks their screen, businesses can get those iPhones and iPads replaced without additional cost.

Let’s check out what else is in store from  enterprise app pact of Watson meets iPad that the two IT heavyweights Apple and IBM had forged in July 2014.

The Apple-IBM Enterprise Mobility Deal

Dubbed the IBM MobileFirst for iOS, the collaboration includes:

• Apple and IBM will create more than 100 vertical-focused enterprise apps built only for the iPhone and iPad. Target markets include retail, healthcare, banking, travel and transportation, telecommunications and insurance starting in the fall.
• IBM's cloud services such as device management, security and analytics will be optimized for iOS. Private app catalogs and productivity suites will be available. Services will be available on IBM's Bluemix development platform.
• AppleCare will be tailored for enterprise deployments with support on-site via IBM.
• There's a commitment to use IBM's Fiberlink MaaS360 for mobile device management. 
• Apple is standardizing on IBM's analytics and big data apps. 
• IBM will package device activation, supply and management for the iOS partnership. IBM will also sell industry-focused iPhones and iPads as a bundle.
• Big Blue's 100,000 consultants will push Apple wares in the field.
• And finally, IBM's financing arm will be in on the deal.

What’s In It For Apple

While Apple's iOS dominates the consumer market space, it is no where to be seen as Androids rule in the enterprise space.

Apple’s CEO Tim Cook faces increasing competition in the consumer space, saying “The market opportunity reference is critical. Apple has been knocked for lack of an iTV or iWatch (at least for now), but if it mines the enterprise better it'll keep the cash cow going for years.”

With IBM’s vast army, Apple can now get into the enterprise space without having to exclusively build and market to corporations.

Jefferies analysts Sundeep Bajikar and Mark Lipacis said to investors that the Apple-IBM partnership could bring in 42 million new users for Apple. That could amount to billions in iPhone and iPad sales, giving Apple a needed boost to iPad sales in particular — especially in the enterprise.

Apple’s Tim Cook adds, "We're putting IBM's renowned big data analytics at iOS users’ fingertips, which opens up a large market opportunity for Apple. This is a radical step for enterprise and something that only Apple and IBM can deliver.”

What’s In It For IBM

IBM CEO Ginni Rometty said the alliance will transform "the way people work, industries operate and companies perform."

Besides the “cool” cred, IBM now gets to resell the devices, have them configured out of the box, preloaded with apps, software and policies such as security that the enterprise needs.  IBM gets the supply, activation and mobile device management (MDM) business.  IBM will also offer app development for custom-built apps, using its big data, analytics and software stack.

Apple's Tim Cook shares about the apps, "We think that the core thing that unleashes this is a better go-to-market, which IBM clearly brings to the table. But more importantly, apps written with mobile first-in-mind. Not all of the enterprise apps written for iPad have been ported from a desktop arrangement and not taken full advantage of mobile."

IBM Gets A Head Start in Mobile Enterprise Leadership

Forrester analyst Frank Gillett believes, “The Apple IBM partnership is a landmark agreement. Given IBM’s market strength and coverage, this partnership gives Apple enterprise capabilities and credibility at one stroke -- and gives IBM a premium advantage in the race for mobile enterprise leadership.”

The AppleCare for Enterprise is only the first. Watch this space for more new innovations to come.

Move to Value: IBM Invests In Systems

As IBM consolidates the Microelectronics manufacturing with GlobalFoundries, questions were raised as to whether this would be further divestment of the systems business and why IBM would pay GlobalFoundries $1.5 billion in cash over the next three years to take the chip operations off its hands.

In a 10-year partnership, GlobalFoundries will supply IBM with Power processors in exchange for access to IBM's intellectual property. That would allow GlobalFoundries to access key chip making technology and guarantee the chips  IBM needs for its systems, like mainframe, power servers and its Watson data-analytics technology.  

IBM Divests Microelectronics To Invest In Systems

IBM needs “to narrow their focus, get their A-game on, and any distractions from a core business perspective, such as this deal, need to be put in the rear-view mirror," FBR Capital Markets analyst Daniel Ives told Reuters.  "From an IBM and investor perspective, it takes one troubled area out of the core franchise."

The cost of making chips has risen, and semiconductor development is getting more complex, making the business less viable.  Besides using its own Power chips, IBM also sold them to game console manufacturers like Sony, Nintendo and Microsoft.  However, IBM still lacks scale and despite generating $1.4 billion revenue, has $700 million loss in the last year.  

According to Ana Hunter, Vice President of Foundry Services at Samsung, putting together a factory to make the next generation of semiconductors will cost about $10 billion. Globalfoundries will book around $10bn over the next year in capital expenditures – which shows you just how expensive it is to compete in the chip building side of the industry.  It makes sense to consolidate the manufacturing with foundry to pool investments and risk.

IBM East Fishkill Factory to be transferred to GlobalFoundires

(Image Courtesy of Dutchess County Economic Development Corporation)

Matt Eastwood, an analyst at IDC, said the deal makes sense because of the changing economics of the semiconductor manufacturing business. "The cost of semiconductor manufacturing is going to continue to increase, making it a business where scale will matter more and more going forward…(GlobalFoundries) also hopes that IBM's focus on growing the OpenPower ecosystem will create new demand for semiconductor manufacturing services.”

By divesting the semiconductor manufacturing business to GlobalFoundries who can scale up and build Power cores for a wider customer base, IBM will also free up capital to be reallocated to other areas.  IBM will focus on the research and design of high-end chips, servers and super-computers.  This is part of their focus on enterprise-class systems innovation.

Arvind Krishna, General Manager of IBM's Manufacturing & Development said "Over time, you will get the at-scale manufacturing that actually assures the longer-term sustainability of these systems," he said. 

“This is another milestone in our journey to transform the IBM Systems and Technology Group,” said IBM Senior Vice President, Tom Rosamilia. “The agreement focuses on the strengths of each company. GlobalFoundries will drive continued leadership in scale manufacturing becoming our premier supplier of semiconductor technology, and IBM will continue to create breakthrough R&D innovations that will fuel the next era of computing systems."

 IBM Watson, a cognitive computing built on IBM Power System

IBM’s Commitment to Systems

The systems strategy is clear: “We will continue to be a leader in high-performance systems, storage and cognitive computing, while continuing to invest in advanced semiconductor R&D.”  IBM’s research mission is unchanged -- to deliver technology leadership that differentiates their systems today while continuing the leading edge work to create the advanced semiconductor technologies of the future.” said IBM Senior Vice President, Tom Rosamilia.

Over the past year, IBM has made bold decisions, steering its portfolio toward world class systems and technology innovation. The company has

• deployed new cloud and mobile solutions for the mainframe; 
•  opened the Power architecture to more than 60 members through the OpenPOWER Foundation to expand the use of the architecture;
• invested in software defined storage capabilities and high performance Flash;
• announced investments in the next generation of chip technology, 
• developed cognitive computing systems which can help process natural language and unstructured data created by sensors and mobile devices, and
• speed up development of Watsons which is already making impact in areas like personal medicine

All of these actions reflect IBM's deep commitment to lead in enterprise-class systems.

"Given that all the design, all the software, all the operating systems, all of the firmware and all of the other system advantages that we put in remain with IBM, my basic answer would be it does not impact our mainframe, or power system or our storage clients at all," he said. 

IBM OpenPower Foundation Members at all layers of the stack

The OpenPOWER Foundation members are developing their own Power chip for server applications. Founding members include Google, Samsung, Tyan, nVidia, Mellanox.   

Google has also shown an interest in Power architecture, said Richard Dougherty, founder of analyst firm Envisioneering Group. While its large-scale data centers run mostly off x86-based systems, Google has also designed a Power server board.

Google mother board with IBM Power chip

 

The highly regarded IBM Research labs, which boasts Nobel Prize winners on staff, will also continue to rethink and reshape computer design. IBM in July announced it would pour $3 billion over five years into hardware research that could lead to quantum computers and cognitive systems that mimic brain functionality. A brain-like chip was announced in August, and the researchers have made progress in investigating chip materials beyond silicon. For example, this is a 16-chip version of IBM’s neurosynaptic (brain-like) computer.

16-chip version of IBM's neurosynaptic (brain-like) computer

Move To Value: IBM Sells Microelectronics To GlobalFoundries

Just last week, I shared about IBM CEO Ginni Rometty’s interview at Fortune’s Most Powerful Women Summit, where she talked about the corporate strategy of moving towards higher value and differentiation.

For decades, IBM has been synonymous with innovation, cutting-edge technology, and cool research and developments that pushed the boundaries of what computers were capable of doing. Today, the innovation shifts to create breakthrough R&D innovations that will fuel the next era of computing systems.

In line with the delivery of that strategy, IBM has announced that it will pay $1.5 billion to GLOBALFOUNDIRES to take over IBM Microelectronics, its chip-making factories. According to an anonymous source, IBM will in return receive $200 million worth of assets as part of the supply of chips, making the net deal value $1.3 billion. 

IBM will become a major customer for GlobalFoundries, buying Power chips from the manufacturing company for its own mainframe and “scale-out” systems as well as for next-generation storage systems.  IBM will continue to design high-end chips and sell servers and supercomputers.  The deal is expected close in 2015.

Why GlobalFoundries?

GLOBALFOUNDRIES, which is owned by the Mubadala Development Co, the Abu Dhabi government's investment fund, has been collaborating with IBM since their inception in March 2009.  GlobalFoundries was created in 2009 when Advanced Micro Devices (AMD) sold its manufacturing operations to Advanced Technology Investment Co., which is wholly owned by the government of Abu Dhabi, a part of the United Arab Emirates.

It is the world’s first full-service semiconductor foundry with a truly global footprint. Launched in March 2009, the company has quickly achieved scale as the second largest foundry in the world, providing a unique combination of advanced technology and manufacturing to more than 160 customers.  With operations in Singapore, Germany and the United States, GLOBALFOUNDRIES is the only foundry that offers the flexibility and security of manufacturing centers spanning three continents.

According to Forbes’ contributor Roger Kay, there are only two foundries and one integrated manufacturer that have the investment capabilities to undertake risk in the semiconductor industry - Taiwanese TSMC, GlobalFoundries and Intel.  The integrated manufacturer Intel fights a lonely battle, doing all its R&D internally, building its own factories, making its own chips, and selling them to customers who build systems.  

In contrast, the industry has Common Platform, an alliance formed with IBM, Samsung, GlobalFoundries who picked up AMD and Singapore’s Chartered Semiconductor and an alliance potentially in British ARM for Qualcomm and Apple.  The alliance has great benefits of reduced cost, technology development and physical risk.  

This means a serious threat to Intel and a bold reason for IBM to pay GlobalFoundries for IBM Micrelectronics just after divesting their x86 business.

Check out the news at http://www.youtube.com/watch?v=v71u2pi0DwE

3 Steps To Transforming The Economics Of Data

Data is growing at an explosive rate - over 667 exabytes of data will flow through the Internet alone in 2014. What is exabyte - that's 667 quintillion bytes ... 667 with 18 zeros after!! 

This tremendous growth places intense demands on storage systems, especially flash arrays and storage virtualization.  How can clients transform the economics of data? 

 Watch this video: This clear and simple white-boarding video below explains the details. 

 https://www.youtube.com/watch?v=kik3I7krTMQ

New Challenges From Big Data

Companies are facing challenges from data:

1. Growing Data – not just the traditional structured data from traditional, but also the unstructured data from social media

2. Storage inefficiency – companies are buying 24 percent more storage but less than half is used.

3. Storage complexity – More data is generated across departments which is not linked across the organization

Making Sense of Data

How can we make sense of the data and enable the infrastructure to support it?

1. Optimize the storage with real time compression technology – store 5x more data and reduce cost by 60%

2. Maximize performance with flash – business applications can run 3.5x faster

3. Enable new workload with software defined storage – simply storage management and access to get data when needed, easy to deploy cloud, social and mobile platforms.

Data Helps To Stay Ahead Of Competition

With the right infrastructure and technology, business can stay ahead of competition. Each division can access data and use it for competitive advantage:

1. Sales gets insights and are able to run analytics needed to make more profitable business

2. Marketing can run highly effective marketing campaigns with better customer insights

3. Finance can keep cost under lock with more efficient technology

Request for a 1-on-1 Demo

Register for Storage Solution Demo:

https://www.ibm.com/services/forms/signup.do?source=stg-transforming_the_economic

For more specific demo related to Cloud & Big Data Analytics:

• IBM Elastic Storage for Big Data

IBM Software Defined Storage transforms data economics for traditional and new era workloads with new data flexibility, agility, and responsiveness – all delivered through software.  And at the same time, maintaining the required security and reliability that are critical for your data systems. IBM Elastic Storage provides high performance for petabytes of data and billions of file using a mixture of disk and LTO tape under a single global namespace and reduce TCO up to 15x and energy consumption up to 230x. This demo shows automatic data placement policy and movement across disk and tape tiers and still retains data availability for your applications at all times.

• IBM Storage on Cloud

Enables enterprises to implement a private cloud storage service where users, with a few clicks, can request & receive storage capacity, share files with other users, and administrators can easily monitor & report usage. Simplify work for your storage admin, and reduce SAN & NAS storage provisioning time from days and weeks to minutes!

Technology - the secret to winning F1

Technology events have never gotten more exciting!  We had a total sensory experience at IBM ASEAN’s Xcite event with Infiniti Red Bull Racing Team.

Al Peasland (Head of Technical Partnerships, Red Bull Racing) was our speaker who gave us a TED-style sharing of the partnership between IBM and Red Bull Racing.  We experienced the Infiniti Red Bull spirit of fun and philosophy of “performance and reliability” with Al’s passionate delivery and interactive presentation.

 

Performance is great but if it doesn't happen when you need it, you cannot consistently win the race.  If it is just  about reliability, you may not become the best without pushing performance.  Both are important to keep staying ahead and winning.

Al shared, “Platform Computing is the back bone infrastructure for high performance computing, which helped Red Bull Racing with the design of the car, the analytics and the race strategy.”  It is used to plan into the future, to create all the what if scenarios and to predict what may happen in the two hour race.

When the single focus is to win races and championships, every element of the design and manufacture of Formula One racing cars is critical. With Formula One regulations becoming more stringent each year, Red Bull Racing is designing the entire car in a virtual world and parts are machined directly from 3D CAD models. Red Bull Racing also collects massive amounts of data from wind tunnel testing and from the car during races. These processes demand extensive use of simulation and data analytics, and a first class IT infrastructure.

Infiniti Red Bull Racing is ahead of the league that is embracing Platform Computing, a software from IBM Systems & Technology Group.  Also sometimes known Elastic Storage for Software Defined Environment. It helps to maximize the potential of computing power by pooling resources, managing them efficiently across multiple groups, so that one can run many iterations, simulations and analytics to get business results fast.  This is the winning formula to harness the benefits of unstructured data and data explosion.

We are glad to be the technology innovation partner that drives the winning Formula One car.  Technology - platform computing technology - is the secret to winning!

Catch Al's interview: https://plus.google.com/101708759635909645335/posts/MmgQDhqx3Yj
Read more: http://www.slideshare.net/annephey/blog-2014-1016-infiniti-red-bulls-secrets-to-winning-f1-races

HP Splits Up. Is Two Better Than One?

The IT industry is just getting more exciting.

Hot off the heels of IBM’s sale of its x86 server business to Lenovo, providing the momentum for Lenovo to repeat its success in 2005 when it acquired IBM’s PC division to become the number one vendor, HP makes a major announcement to spin off its PC and printer division into a separate company.

1.WHAT IS THE SPLIT
 

Former chief executive Leo Apotheker had proposed the move in 2011, 6 years after IBM sold its PC business.  It happened at the same time that HP’s disastrous acquisition of the British software company Autonomy.  Eventually, HP held on to its PC business amid shareholder pressure, resulting in Apotheker’s departure and Whitman’s appointment.  Meg Whitman who joined 3 years ago to turn HP’s fortunes around had dismissed her predecessor’s plan to carve up the firm but has now changed her mind in the fourth year of her five-year turnaround plan.

HP expects to complete the  split of HP into two public companies by end of 2015 fiscal year.  Shareholders will automatically own shares in both companies.

• Hewlett-Packard Enterprise to cover corporate hardware and services, which Whitman will head up, and
• HP Inc to comprise the PC and printer units, to be headed by Dion Weisler (the current executive vice-president of HP's printing and personal computing division). Whitman will be the chairman of the HP Inc board, thereby retaining influence in both businesses.

2.WHY SPLIT

"The decision to separate into two market-leading companies underscores our commitment to the turnaround plan," said Whitman. "It will provide each new company with the independence, focus, financial resources, and flexibility they need to adapt quickly to market and customer dynamics, while generating long-tern value for shareholders."

3. IMPACT OF SPLIT 

HP’s role in the IT market has been becoming increasingly unclear – with parts of its business moving toward growth areas, while others are being optimized to compete on the last era’s competitive battlefield.  This left the company in a tough spot, where new innovation efforts were often overshadowed by large legacy challenges.  HP has been addressing this through aggressive restructuring, ultimately shedding as many as 55,000 jobs by the end of FY2015. 

Whether HP’s efforts to reduce complexity and be more nimble with two large companies remains to be seen.  There are still many of the HP businesses that are not synergistic with different levers for success or where potential partners are unable to fit strategically with the company.

4. WHAT'S NEXT

Just when HP struck out at IBM by blatantly advertising that IBM customers and business partners should be worried about the x86 business sale to Lenovo, HP has now plunged into deeper uncertainty with their own company split.

It would be important for HP to quickly establish how different they will be after the split and what is the desired perception of HP to the world.