IBM’s Clayton Talks Hybrid Cloud Strategy, $1 Billion Investment
Big Blue is focused on this trillion-dollar market – and public cloud, too. And the channel looks to win throughout.
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As IBM prepares to split into two companies, it is honing its hybrid cloud strategy. And the indirect channel will prove vital to the success of that effort.
Cameron Clayton is general manager of IBM’s hybrid cloud ecosystem and weather.
IBM’s Cameron Clayton
“We’re going to invest over $1 billion into our ecosystem and our partners,” Clayton told Channel Futures.
Independent software vendors, global system integrators, developers and strategic advisory partners, that means you.
A Recap of What’s Happening
By the end of 2021, IBM expects to separate into two businesses, one focused on hybrid cloud, the other on managed infrastructure services. (For now, Big Blue is calling the latter “NewCo.”) The initiative comes as hybrid cloud poses a $1.2 trillion opportunity by 2022, according to McKinsey & Company.
“Now is the right time to create two market-leading companies focused on what they do best,” Arvind Krishna, CEO of IBM, said recently. “IBM will focus on its open hybrid cloud platform and AI capabilities. NewCo will have greater agility to design, run and modernize the infrastructure of the world’s most important organizations.”
Industry observers seem bullish on the plan. For example, Anurag Agrawal, CEO and analyst at Techaisle, called the announcement, “brilliant, smart and the right move.”
“The three verticals – banking and financial services, industrial and manufacturing, regulated workloads – that IBM targets with its cloud services will benefit,” he said. (More on that financial services aspect in a bit.) “Partners will gain advantage and can more easily participate in [any of] three cloud tracks – build, sell, service – because the partner program will be less diffused.”
Daniel Newman, principal analyst at Futurum Research, concurred because the separation promises to create “a brighter future with more promising growth numbers.”
Understanding IBM’s Hybrid Cloud Timing, Vision
IBM’s cloud vision started to coalesce about a year before it bought Red Hat, Clayton said. Solidifying that purchase brought powerful tools and capabilities to Big Blue’s portfolio as it sought to expand from mainframe, and public and on-premises cloud offerings. The obvious candidate to add? Hybrid cloud.
“The ability to build once and run in multiple places, that’s really what the acquisition of Red Hat facilitated,” Clayton said. “That’s at the core of our hybrid cloud platform. This is an opportunity bigger than IBM by itself and we have to partner, and we want to partner, in order to lead … around that hybrid cloud category.”
Remember, he said, only 20% of workloads have so far migrated from on premises to public cloud.
“The rest haven’t because they’re really complex and not easy to move. They’re regulated, complex, high-volume situations like banks,” he said.
And who better to target those organizations than …
… an already embedded 109-year-old company? IBM just had to make sure its answer to hybrid cloud would meet its (and clients’) exacting standards and requirements. That’s why Big Blue has only emphasized hybrid cloud over the last six months or so.
“Hybrid cloud has been around as a term but, I would say, not really as practical reality,” Clayton said. “You could make an architectural choice to run some of your things in public cloud and some of your things in your on-premises data center, but you had to write both of them differently and separate streams of work to run the same application in both places.”
Conversely, he explained, when IBM says “hybrid cloud,” “you write it once and deploy with click of a button into any of those environments — mainframe, on-premises, public. It’s really a different and architectural feat to do that securely.”
Yet thanks to the Red Hat acquisition, “it’s really real today,” Clayton said.