Friday, February 24th, 2017

Time	Event
6:30p	Cisco Beefs Up Network Automation, Shifting Further Away from Hardware Focus By The VAR Guy Cisco is betting big on guiding networking customers and partners through the digital transformation. This week, it’s announced a new line of firewalls, as well as additional products and services to its Digital Network Architecture (DNA) program, expanding its scope to help the channel leverage new automation and security technology in a consultative approach. DNA’s integrated networking software offerings cover virtualization, automation, cloud service management, security and analytics under one umbrella and is a big shift in strategy for Cisco, says Jason Gallo, Global Director of Partner Software Business Development at Cisco. “Our former view of the network was very hardware-centric; you would have to maintain the network in a very manual way,” he told The VAR Guy. Because it was closed environment, any changes that needed to be made were reactive. DNA was a response to customer demand for more flexibility and automation in a software-defined ecosystem. “Customers wanted a network that was much more software-driven. It should be automated so that the processes that they have can neatly fit and take some of that operational burden off it being so manual,” Gallo said. “It has to be programmable.” Partnership with IDC The newest innovations to DNA stem from research that Cisco developed in conjunction with research firm IDC that attempts to help customers benchmark their network readiness. The resulting model outlines five steps of network intelligence: best effort, manual, semi-automated, automated and self-driving. And it turns out that the number of businesses who rank among the highest levels of the model are few and far between. Out of the 2,000 customers Cisco and IDC surveyed, nearly half fell into the level two “manual” stage. And only one percent qualified for the top level “self-driving” gold medal. “From a partner standpoint, that’s quite a large opportunity to help just about half your customers,” said Gallo, “ Really more than half if you include even the best effort to move up to a more digital ready network.” The research led to the development of a guided assessment called the DNA Readiness Advisor, which shows users how they measure up against peers and geographies and identifies ways in which they can improve performance and rise in the rankings. Partners can walk customers through a consultative, half-day assessment using the tools, templates and data available in the Advisor, leveraging the platform to sell their own professional services. If a broader engagement is needed, they also have the option of bringing in Cisco-delievered DNA Advisor services. The new products announced essentially extend Cisco’s DNA Virtualization suite across more points in the network, with new hardware platforms for customers looking to virtualize all their network functions, as well as a new agile exchange solution for virtualizing the network parameter. In addition, Cisco has upgraded its security solutions for DNA, building them into the platform instead of offering them only as add-ons. The company has revamped its identity services engine to make onboarding network guests faster and easier and introduced a new DEFCON capability that allows network administrators to set different levels of lockdown in case of an attack. Next-gen Firewalls The new DNA security features were announced side-by-side with Cisco’s newest line of firewalls, Firepower 2100 series. Mark Bagley, Director of Product Management at Cisco, said the expanded architecture was developed in reaction to partner customer demand for scalable network security programs, especially for administrators who might not be IT security practitioners by default. “They’re spending more than they’d like to, and it’s harder to manage the security that they do have deployed,” he told The VAR Guy. “They’re of course dealing with efficacy challenges as well as they try to defend these environments. In many cases, they significantly over-provision their offerings to avoid the performance problems that are common with solutions at the price points they can afford.” Bagley says there are two points to the new announcements that should be most interesting to the channel. First is the release of a new set of capabilities inside Cisco’s management framework called Threat Intelligence Director that supports the operationalization of third-party cyber threat intelligence into the network defense management platform. There are also new enhancements to Firepower Device Manager, the on-the-box management technology, which supports simple low touch provisioning for small use cases. Cisco says that giving partners the ability to scale the distributed deployments and distribution of configuration will be particularly useful for our users trying to scale proof of value programs for customers’ next generation firewalls. “It requires much lower levels of effort than it took previously to scale this type of experience,” said Bagley. “Not only are we excited about it for sort of the opportunity that it represents for the go-to-market perspective, we think this is going to help the channel make more money faster with our offerings.” Dave Gronner, senior manager of security-go-to-market, global partner organization at Cisco, says there’s never been a better time for security partners to be in business. “My conclusion is this platform 2100 it fits in perfectly with the fact of security as an consultative-lead business for partners. It’s not a box business. It’s not a commodity business. Customers need someone to come in and help them guide them through what tomorrow’s problems look like.” Joe Leonard, Chief Information Security Officer at Presidio, says the Firepower 2100 represents next-gen firewall technology that’s key to helping customers navigate the digital transformation. The number of new devices and network connection points that come with mobile, the Internet of Things (IoT), social media and a myriad of line of business (LOB) applications mean many of Presidio’s customers may not have visibility into what’s going on in their infrastructure as far as access to sensitive data. Being able to give them that visibility increases Presidio’s value. “It’ll lead a lot of times to going back to look at where this gets placed into the network. We have to look at whatever their existing firewall is and how they migrate to the new firewall, to the 2100.” And that, he says, increases customer stickiness. “What does that migration strategy look like? What do they need to think about? We help them with the whole migration so that they can get on to the new platform.” This article originally appeared on The VAR Guy. (Comment on this)
7:00p	HPE’s Whitman Struggles in Shift to Smaller Size, Cloud Pressure Brian Womack (Bloomberg) — Hewlett Packard Enterprise Co.’s Meg Whitman, who has been working to transform the company into a more efficient corporate-technology provider, is being thwarted by rising supply costs and aggressive cloud rivals. Whitman on Thursday cut the company’s adjusted profit forecast for the current fiscal year, missing analysts’ estimates. At the same time, Hewlett Packard Enterprise reported sales that missed projections for the third consecutive quarter. Though citing some challenges beyond her control, Whitman said she pushed some executives too hard while the information technology provider frees itself of underperforming businesses and finds new growth opportunities. “New people, new jobs, some market pressure, and separation — and we just might have overloaded the troops just a tad here,” the chief executive officer said in an interview. Going forward, “I feel really good about the strategy, and we’ve just got to power through commodities and foreign exchange and get everyone settled in for the new company.” While shrinking the company to make it more nimble,  Whitman is battling rising competition from cloud-based technology providers that let customers access computing power without having to buy their own servers and storage gear. She has been acquiring companies to help with growth, but is struggling against rivals such as Amazon.com Inc., which saw cloud revenue jump 47 percent in its last quarter, and Microsoft Corp., which reported sales almost doubled on its cloud product. Profit, excluding some items, will be 41 cents to 45 cents a share in the current quarter, the Palo Alto, California-based company said in a statement. Analysts projected 47 cents, according to data compiled by Bloomberg. The company also reduced its annual forecast to $1.88 to $1.98 a share. Analysts estimated $2.03. The shares fell as much as 6.7 percent in extended trading after closing at $24.66 in New York. Sales Decline Revenue declined 10 percent to $11.4 billion in the quarter ended Jan. 31 compared with the average analysts’ projection of $12.07 billion. Sales in the key Enterprise Group — which includes servers and storage gear — dropped 12 percent to $6.3 billion. The business reported declines of 9 percent in the previous quarter and 8 percent in the period before that. In the enterprise unit, server sales fell 12 percent from a year earlier while storage revenue declined 13 percent. Networking sales dropped 33 percent. The company cited currency fluctuations, higher commodities prices on items such as memory chips for servers and “near-term execution issues” in reducing its forecast. In addition, Whitman said sales of tech gear were hampered by a customer that is a tier-1 service provider, a reference to a public cloud company. She didn’t identify the customer. “They have dramatically decreased their purchasing below commitments thatthey had made to us,” she said during a conference call with analysts. Company Changes Whitman said the company has reshaped the Enterprise Group to focus more on hybrid information technology products and services that incorporate cloud-based computing. While the changes were important for future success, it was a lot for the organization to handle, she said. This year, Hewlett Packard Enterprise should wrap up two multibillion-dollar deals unveiled in 2016. In September, the company said it was spinning off and merging some software assets in a deal with U.K.-based Micro Focus International Plc. Last May, HPE said it would combine its technology-services division with Computer Sciences Corp. At the same time, HPE has been buying other companies, including Niara Inc., which uses machine learning and data analytics to find security threats. Terms of the Niara deal were undisclosed. The company also announced plans last month to acquire Cloud Cruiser, which helps companies manage technology assets. It recently spent about $650 million on technology gear maker Simplivity. HPE reported quarterly profit, before certain items, of 45 cents a share compared with analysts’ average estimate of 44 cents, according to data compiled by Bloomberg. Net income was $267 million, or 16 cents a share, little changed from $267 million, or 15 cents, a year earlier. (Comment on this)
7:30p	Surge of New Capacity Expected in Top US Data Center Markets This Year Hyper-scale cloud providers’ hunger for server capacity in top US data center markets over the last few years has created a shortage of supply, but, according to a new market report by the real estate brokerage CBRE, that tightness may ease up this year, as developers complete construction projects started in 2016. Unclaimed data center space that’s commissioned and ready for servers to be moved in is extremely tight in major US markets at the moment. According to CBRE, the vacancy rate is 4.6 percent. However, a whole lot of new speculative development is underway and due for delivery this year. In other words, developers are building a lot of data center space without leases signed ahead of time. By CBRE’s estimate, 271MW of capacity is currently under construction in major markets. More than 160MW of it is being built speculatively. Most of the construction is happening in Northern Virginia (121 MW). A lot of construction is also taking place in Dallas-Fort Worth and Silicon Valley, among other markets. See also: Sabey Launches First Building in Booming N. Virginia Data Center Market These numbers do not necessarily signal an upcoming drop in value of data center space, according to the brokers: “Even with the addition of much-needed new supply, market conditions in nearly all major data center markets should remain landlord-favorable in 2017 from a supply-demand balance perspective.” Another big source of new supply is on the rise. In a statement, Pat Lynch, senior managing director for Data Center Solutions at CBRE, said he expected traditional enterprises to continue moving systems out of data center facilities they own and into the many flavors of outsourced data centers (cloud, colocation, or managed services). That will leave a lot of enterprise data center facilities available for purchase. This trend picked up in 2016, when total sales volume for data center assets was $1.78 billion. The average sale price per square foot was $275, according to the report. Read more: 2016 Was a Record Year for Data Center Acquisitions, but 2017 Will Be off the Charts The total does not include the two large portfolio acquisitions announced in 2016 but not yet closed: Equinix’s acquisition of Verizon data centers in the Americas, and the acquisition of CenturyLink’s colocation business by a joint venture between BC Partners and Medina Capital. Lynch said corporate data center assets coming on the market this year are “not likely a supply-side risk to the multi-tenant market.” However, the assets that are near major population centers and have robust network connectivity characteristics will potentially see strong demand and pricing. (Comment on this)
8:47p	Google First to Upgrade Cloud Data Centers with Intel’s Latest Chips Google has upgraded servers in cloud data centers across five availability regions with Intel’s latest Xeon processors, codenamed Skylake. The company claims it is the first cloud provider to do so. Amazon said last year it expected to launch Skylake-powered C5 instances on its Amazon Web Services cloud sometime in early 2017. Microsoft has not revealed plans to upgrade to Skylake, but the blog AnandTech has deduced from a company blog post that Intel’s latest and greatest in data center tech is likely to appear in the next-generation Open Compute servers the giant said were in the works last November under the codename Project Olympus. More on Project Olympus: Microsoft’s New Cloud Server Design is Half-Baked, and That’s the Point The processors are geared for workloads that require high performance, such as scientific modeling, genomic research, 3D rendering, data analytics, and engineering simulations, Urs Hölzle, Google’s senior VP of cloud infrastructure, wrote in a blog post. These applications will benefit from the new chips’ Advanced Vector Extensions (AVX-512) feature. In Google’s internal tests the feature improved application performance by up to 30 percent, Hölzle said. Google optimized Skylake for all its Google Compute Engine VMs, including standard, highmem, highcpu, and Custom Machine Types. Cloud servers powered by Skylake are initially available in five Google cloud regions: Western US, Eastern US, Central US, Western Europe, and Eastern Asia Pacific. This is a second major processor upgrade announcement from Google’s cloud services division this week. On Tuesday, the company said it had added the option to spin up bare-metal GPUs along with cloud VMs for machine learning and other compute-heavy applications. See also: How to Get a Data Center Job at Google (Comment on this)

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