Code named “Project Horizon”; this subscription service is being touted as a replacement for the traditional operating system (re: Microsoft) but detailed specifics regarding this project were hard to find.  

As Vittorio Viarengo, VP of Desktop Marketing for VMware states: “The role of the operating system is getting diminished every day on the server side”, and I can readily see VMware’s viewpoint that it is likely to move into the desktop space in the mid to long term. With that said, I believe there are some key caveats that need to be properly addressed:

• Security
• DR/BC/Central Point of Failure
• Provisioning
• Management
• SLA

Does anyone remember how long it took to get the traditional desktop OS to even address these key bullet points? And this was on pretty standardized Wintel machines for the most part.

On paper, the hosted platform should take care of these issues pretty handily, but we all know there are always discrepancies between real life and what is presented on paper; especially when it comes to IT.

Anyway, I really like the way VMware seems to be innovating on all cylinders recently. This renewed (in my opinion) innovation, coupled with some great strategic acquisitions (Integrien, SpringSource, and TriCipher) makes me think they can move from being a company that simply virtualizes operating systems to a company that provides broader operating frameworks for both data centers and desktops.

I will definitely be keeping a close eye on this company, and on Project Horizon in particular, in the upcoming months

TASCer

Specifically, the contract, which was in effect from 1998 to 2006, required Oracle to update the General Services Administration (GSA) whenever commercial discounts improved and extend those same, improved discounts to government customers.  The suit is expected to involve hundreds of millions of dollars in sales.

The suit was originally filed on by Paul Frascella, Senior Director of Contract Services at Oracle.  BTW – The False Claims Act allows private citizens with knowledge of fraud to file whistleblower suits on behalf of the United States and share in any recovery. If the United States intervenes in the action and proves that a defendant has knowingly submitted false claims, it is entitled to recover three times the damage that resulted and a penalty of $5,500 to $11,000 per claim.

#1 – How can a company such as Oracle let that happen?  A quick Google of: “Oracle AND Contract Management software” comes up with an immediate hit for Khameleon, an Oracle based contract management software solution where one of its benefits is: “Change your pricing, and Khameleon applies the new prices to customers according to their contract’s unique terms.”  I think I may know Oracle’s next acquisition target….    

#2 – How can Mr. Frascella be still going to work this week AND I wonder what his new title is?  I think I would be cashing in my PTO at this time and coming down with a new strain of the 24-hour flu that lasts a few months…….

And #3 – What are the odds this won’t go to trial?  I’m thinking 3:1.  Oracle will definitely not want to stretch this out, but they obviously do have the money if really needed.  I feel the corporate image hit will be too strong if it lingers for long, so I say a settlement will probably be in the works.

**Note to government**  Take the settlement (no less than $400 mil), get an infinite free contract for services and software from Oracle, and make Larry apologize on national TV.

TASCer

Function: noun

Date: 1903

1 : the care that a reasonable person exercises under the circumstances to avoid harm to other persons or their property
2 : research and analysis of a company or organization done in preparation for a business transaction (as a corporate merger or purchase of securities)

 It seems that back in 2008 HP forgot about this very important term and M&A requirement when it acquired Electronic Data Services Corporation (EDS .) 

Recently, a British High Court ruled that EDS was at fault for a bungled customer relationship management (CRM) implementation at British Sky Broadcasting Group (BSkyB) back in 2000.  This bungling, which was due to EDS’ misrepresentation of how long the implementation of the system would take in order to win the contract, will cost HP $460 million.  Ouch.

BSkyB terminated the work in 2002 after the EDS timeline was well past the due date and went ahead and completed the implementation on their own in March 2006.  In the meantime, they started legal action against EDS in 2004, went to trial in 2007, and the British High Court ruled in their favor in January 2010.

Looking at HP’s performance, it is apparent that for various consecutive quarters, EDS emerged as a smart purchase by HP, as the company’s service unit was the only growing business line. But the takeover came with some extra baggage, which included a hefty lawsuit.

This baggage should definitely have been vetted out and acknowledged in the $13.9 billion acquisition price.  I thought it was a high price even before learning about this. 

It seems very apparent to me that someone, or some group, did not do their research (re: due diligence) and this ticking bomb went unnoticed or disregarded for quite some time.

I can hear the EDS M&A lawyers laughing now….

This pilot program will allow existing Citrix customers who are also members of Amazon’s Windows Server License Mobility Pilot to move their XenApp licenses from their own data centers to the EC2 cloud.  Moving XenApp to the EC2 cloud could benefit businesses by reducing the number of physical servers required in their data centers as well as having their platform reside in a fully supported environment.   

This pilot program currently does not support Amazon’s Virtual Private Cloud, which is designed to bring enterprise-class security to computing resources that run in Amazon’s data centers, but this support is slated to be available at a future date.

This pilot is definitely a huge step forward for cloud computing and will be very interesting to hear about how the program was received.

If anyone is a member of this pilot program, I would love to hear from you.

Regards,

TASCer

One week after closing the $2.7 billion acquisition of 3Com, HP announced on Monday that its newest “Cisco-free” data center takes advantage of HP/3Com equipment to “achieve twice the port and capacity density, and a 50 percent reduction in power consumption versus previous solutions.”

This shot is meant to alert Cisco of the direct competition between their solution and  Cisco’s Unified Computing System, which combines servers, storage, networking and virtualization technology into a single box.

States Ken Gray, HP Vice President in a recent press release: “We’re Cisco-free in this data center and have a plan to extend this freedom across all of our internal IT data centers next year.”

Ouch! Did he really need to use the word ‘freedom’?

It should also be noted that the HP solution is promised to be an open architecture, allowing interoperability with multiple vendors and conforming to industry standards.

Thank goodness there are not kids involved, I’m sure this shot was heard loud and clear in San Jose….

The company’s website does not state an approximation on how many systems were affected, but I’m sure they definitely looked on the bright side of things as it affected only one platform and not both x386 and x64.

Read BitDefenders’ Press Note here regarding the faulty definitions update.

It is very strange to me that on their website, in the Press Center area, they have a blurb regarding an award they received recently on the main page.  Only after clicking on More News, do you see the more important and timely news…  I feel this would be the perfect case of ‘full disclosure’ if there ever was one.

In today’s day and age of virtual technologies (easily created and managed test and Dev environments), testing tools (load, regression), version control (SourceForge, Team Foundation Server) and testing methodologies, situations such as these should not happen anymore; period.  I expect some heads to roll on this one.

I would like to keep an eye on how this will affects the company going forward as I have never heard of them until I read about this issue over the weekend, but it seems to be a private company created in 2001 which also received some financial assistance in the end of 2007 from an investment group made up of both U.S. and Romanian individuals.  And, if the way they handled this news is any indication, I would be very hard pressed to find any open and readily available divulgence of negative information anywhere, especially their website….

For years Cisco has had a contract with HP to provide system integrations, but this partnership has been deteriorating for quite some time and was accelerated when Cisco recently created and started touting its Unified Computing System (UCS). UCS is a data center solution that directly competes against the larger server vendors such as: HP, IBM, and others. Cisco has decided not to renew their contract with HP, which will expire on April 30th, 2010.

It seems the main issue between the two is how each of them views customer value. While this is a VERY subjective matter, it seems they do not see eye to eye on this extremely important item. I personally see this as a somewhat fluff (re: easy out) excuse as Cisco is making a bold move into a new space. 

Which company has the ‘better’ view of customer value will only be determined in the long term as customers will have to start looking at their data center and infrastructure options differently going forward.

While both sides allude to the fact that it will be ‘business as normal’ to their customers, we all know that things don’t work that way in IT; and there will be issues.

Both companies have been doing pretty well in 2010, and it will be very interesting to see how things work out for the rest of the year and going forward.

It is, in a nutshell: Mark Hurd vs. Tom Chambers

With similar market share and both having stellar management, I would have to side with Mr. Chambers. I think Chambers made a very tough, calculated, and important decision that will turn out to be a big piece of his legacy.

As an aside; Juniper and/or Extreme may see an offer in their near future. Look at Juniper being the first name bandied about due to their recent security issues. 

Todd

This is a very good sign as the market leader in business networking equipment is usually a pretty good bellwether for the IT industry, if not the national economy as a whole.

In addition, CEO John Chambers went on record today stating: “this sharp increase in capital spending is a precursor to jobs growth for the entire U.S. economy.”

I wonder what percentage of corporations opening their wallets received stimulus monies? It doesn’t matter to me, but finding out would be interesting.

Anyway, things are looking up in regards to our economy in spite of today’s 2 big employment dings. I see late April as an inflection point for the economy.

Created using WordPress iPhone app.

Todd

However, a key item that bolsters my opinion that this is a sunk cost can be easily realized by the fact that Dell has decided to keep the branding of Perot Systems. 

This fact, to me, is a big misstep similar to the one Cisco decided on when it acquired Linksys years ago. Cisco decided to keep the Linksys brand in its entirety until recently. Cisco did not have any integration with Linksys whatsoever until years after the fact. Dell’s saving grace on this point is that they still have their name present (Dell Perot Systems) and a nice and informative tag-line under their logo (Dell perotsystems.)  I think Dell may have learned volumes here… 

These facts do not dispel my thoughts that the acquisition is a bust, but more that the acquisition was well thought out and planned. 

Execution is ALWAYS key.

Dell, and their new-found (re:paid for) IT Services division would be better served if they took Perot’s client base, contracts, prior methodologies, and customer feedback and acted accordingly. This act would also entail the dumping of the Perot Systems brand.

 I stand by my earlier post. Good luck Dell.

Todd

My first instinct is that Dell has maximized their margins on hardware for pretty much all things IT for a good 12-15 years; and are now, in the midst of a recession, looking to bolster their bottom line.

I would say look elsewhere…

With that said, I do give kudos to DELL for the acquisition of EqualLogic as it has expanded their product line.  I do not see this latest action as doing the same.  Hardware and distribution of hardware are VERY different than Professional  Services.

My take on this is that DELL has a very solid hardware and distribution company that has changed the game and made all others in the same space either better or changed their game plan.  Now, this same company is paying a pretty steep premium (in my estimation) to delve into a space that is highly competitive and saturated.

But hey, what is $4B to DELL?

I say it is a sunk cost… 

 I will delve into Perot Systems and EDS in upcoming blogs.

‘Til next time,

Todd