IBM thinks ahead with acquisition
Big Blue looks beyond its own efforts and buys software developer Think Dynamics to try to hasten the unfolding of its on-demand computing strategy.
Think Dynamics' software helps companies control their computing resources by automatically managing assets such as data storage or servers--a task that IBM calls dynamic provisioning. The software does so by automatically reallocating computing resources on the fly to meet spikes in demand or to react to failures.
The acquisition of the 36-employee company for an undisclosed sum adds another element to IBM's on-demand computing strategy, a relatively new, broad-based effort by the company to create IT systems that help manage and heal themselves. The initiative is also designed to let companies tap computing resources more easily, drawing on them the same way they would electricity. This approach allows for variability in consumption, coupled with monthly payments only for the amount of resources consumed.
"We've done a lot of work on provisioning over time on mainframes...but we the realized we needed to bring that kind of dynamic provisioning to multiple systems and to the world of multiple operating systems," Irving Wladawsky-Berger, general manager of IBM's on-demand initiative, told CNET News.com.
With its goal of bringing on-demand products to market as quickly as possible, IBM decided to look outside for the capability, and the deal was struck. It may make similar acquisitions in the future, Wladawsky-Berger said.
IBM, which has launched a number of new products and services under the on-demand banner in the last six months, has pledged to spend $10 billion on the effort over a number of years.
Think Dynamics, which is based in Toronto, will become part of IBM's Software Group. IBM is expected to launch new Tivoli brand products based on the Think Dynamics software. The software will also be used by IBM's Systems Group and its Global Services division.
The software uses a set of predetermined policies to monitor computer resources, then adjusts for changes in demand or failures by reallocating other software, servers or storage systems. It can work with a number of different operating systems, including Unix, Linux and Microsoft Windows, and can be built into new networks or added to existing ones, IBM said.
"You could imagine how this kind of capability would be critical for an organization that's trying to build out an infrastructure," said Jeff Smith, IBM's vice president of on-demand efforts for Tivoli software. "It will be a part our commercial software portfolio."
Aside from creating new software products, the tech giant envisions a job for Think Dynamics within IBM Global Services. The IBM division will use the software to help customers build on-demand computer systems. IBM will either help those customers build their own networks or to work with them and host the computing resources.
IBM has struck on-demand outsourcing deals valued at several billion dollars in recent months, including a $5 billion, seven-year deal with J.P. Morgan Chase.
The IBM on-demand plan is one example of the so-called utility computing trend that is sweeping the industry. Utility computing aims ultimately to allow companies to pay for computing capacity as they use it, as they do for electricity or water. But in the shorter term, it often relates to the ability to fire up a server's unused processors as needed or to tap into an IBM data center in order to accommodate spikes in demand--efforts that the new acquisition will likely aid IBM in delivering.
"A lot of this is going to be enabled through software," said John Madden, an analyst at Summit Strategies in Boston. "The acquisition seems like it's going to accelerate IBM and Tivoli's capabilities to deliver what they've been touting under the on-demand umbrella."
Although the company hopes the acquisition will give its on-demand initiative a boost, IBM isn't alone in offering products or services that put technology like dynamic provisioning to work for other companies. Rivals Sun Microsystems and Hewlett-Packard are investing heavily in creating similar packages.
Sun's N1 initiative to create more efficient computer networks through automation, for example, matches many of the elements of IBM's on-demand program.
Sun recently launched its N1 Data Platform, designed to pool or "virtualize" data storage and thus let businesses allocate resources more efficiently. A company can use the tool to add more storage and servers to handle a spike in workload arising from the processing of monthly financial reports, for example. The data platform uses the technology from Sun's acquisitions last year of Pirus Networks and Terraspring--a former competitor of Think Dynamics.
HP has also organized its resources under a new umbrella dubbed Adaptive Enterprise. Launched earlier this month, the strategy groups a number of HP products and services together in a manner that the company said will help its customers get more out of their computing systems.
The rivals still have a huge amount of work ahead of them, however, both in engineering and in winning over customers, according to Madden. "This is still a horse race, in terms of vendors being able to demonstrate they're putting together products that are going to lead customers to think about IT resources as being more dynamic."