Tuesday, July 11th, 2017

Time	Event
12:00p	VMware, Once the “Easiest Value Proposition in IT,” Defines Its New Role At VMware, a company that about a decade ago enjoyed selling the “easiest value proposition in IT history,” staying relevant today, in a world where most enterprise applications are already running on virtual machines, and where companies have a constantly expanding universe of infrastructure options for their software, never stops being a work in progress. John Gilmartin, a VMware VP and general manager of is Integrated Systems business unit, says that if Intel is correct when it says that “the paranoid survive,” than there’s nothing that doesn’t make VMware paranoid. “Are you being relevant? Are you investing in things that are important?” Answers to those questions are moving targets nowadays. After more than a tryst with becoming a cloud service provider – the vCloud Air days – the Palo Alto-based outfit whose impact on the data center industry is yet to be matched as far a software makers go, is now squarely back to doing what it’s always been good at: making data center software. Let those who excel at building and managing data centers build and manage data centers, goes the thinking. Those would be the likes of Amazon Web Services, now VMware’s biggest ally in the cloud space. VMware is going to focus on making the life of its core audience — the enterprise IT shops — easier as they traverse a world where one cloud simply won’t cut it. Gilmartin expanded on this in an interview for The Data Center Podcast recently. We talked about VMware’s current cloud strategy, reflected on the company’s impact on the data center industry (the whole one server instead of 10 thing turned out to be a big deal), and what it’s like to be part of its new parent, Dell Technologies. Here it is, The Data Center Podcast, Episode 3, with John Gilmartin of VMware: Stream or download from SoundCloud Stream right here: Stay current on data center industry news by subscribing to our RSS feed and daily e-mail updates, or by following us on Twitter or Facebook or join our LinkedIn Group – Data Center Knowledge. (Comment on this)
12:00p	Salute: Putting Veterans to Work in Data Centers When Lee Kirby returned home in 2010 from a tour in Iraq, the unemployment rate for 25 to 35-year-old veterans returning to the US after a single tour of duty overseas was 25 percent. “I wanted to do something to try to address that,” he said. “I’ve been in the data center industry for 30 years, so I know that industry, and I knew we’ve got a lot of labor intensive type jobs — entry level jobs — that people go to a variety of sources for. It’s not always reliable labor. I thought the combination of both the shortage in our industry and the need for jobs for veterans in general would create an opportunity. It seems like it has.” To take advantage of this opportunity, in 2013 Kirby and Jason Okroy co-founded Salute Mission Critical, or simply Salute, Inc., that hires and trains veterans for good data center jobs. Kirby, who is president of Uptime Institute in Seattle, takes no salary from Salute, but serves as chairman and evangelist. Okroy works for the organization full time, and runs it from its headquarters in Charlotte, North Carolina. They also have an office in Chicago. The veterans that Salute helps are not service people trained by the military for highly technical positions — Kirby refers to them as “navy nukes,” a term associated with technicians on nuclear submarines who maintain the power plants — but the troops on the ground whose main job in the military was to put themselves in harm’s way for the protection of others. “A lot of data centers proudly say they hire veterans and they do and should be proud of it,” he explained. “But those are navy nukes and not the demographic that Salute Mission Critical serves. Navy nukes come to the industry with skills that can be immediately adapted to the mission critical space. Other veterans that served in less technical roles do not and that is who we target.” The organization’s business model is similar to that of temporary staffing companies, such as Kelly Services, with client companies paying it for services, and the veterans being paid by Salute. The company is a for-profit organization, choosing early on to forego nonprofit status because it would limit the ways it could compete for contracts. In their first year they hired 50 veterans, a number that’s doubled every year since, and finding unemployed veterans seeking work hasn’t been much of a problem. “We start out by tapping into the state unemployment offices because they identify all veterans,” Kirby said, “so in any state we are doing a bid, we know all the unemployed veterans there that we can hire from, and we focus on them.” The entry job for most of the people Salute puts to work is data center cleaning, which because of racks of sensitive equipment connected by cables, is more complex than most janitorial tasks and requires special training. Although many cleaning contracts begin as one-time projects, they often turn into longer term maintenance contracts. In those cases, veterans are hired locally and are trained by an initial traveling crew who are put-up in modest motels, two to a room. “We just did a job in Oregon,” he said, “a really large data center cleaning project. We brought in a little more than half the team, our traveling team, and we hired the guys local to be the newbies. We go through a training process with them and they shadowed our guys to get the experience in the training project there. They then can be left behind for the ongoing maintenance cleans and such. So we get them through the training, kind of classroom type hands on training, and then we get them into the data center with a mentor and they learn very quickly.” In addition to cleaning services, Salute fills the ongoing staffing needs for some of its clients, which offers opportunities for vets to get a higher level of training. “Some of the larger data centers have smart hands people on site all the time. Some of the smaller colos will have a combination role where they’re the chief cook and bottle washer on site — everything short of engineering. So they’ll open up tickets when the engineer is needed on site, they’ll do the ‘move, add, change’ activity, they’ll let people in the door and they’ll follow the procedures. “That’s what we’ve found as kind of a sweet spot — someone you can trust to be on site to watch your site, do the coordination and non-engineering tasks, and call out engineers as they’re needed. Its a big cost savings for the clients as well.” Clients seem to be happy with the quality of the work. Some, such as Compass Datacenters, signed on with the company as it was just getting started and continue to utilize Salute’s services. Another long time client, EdgeConneX, has contracted them to help with its ambitious expansion into Europe. “We’ve got a large site in the Netherlands,” Kirby said. “We’re going to be working in Dublin by the end of the year, and in London, possibly by the end of the year, but for sure next year. They’re having us follow them throughout Europe and spin those sites up as well, because we did such a good job for them here in the US.” Richard Werner, EdgeConneX’s director of operations, agrees with that last assessment, telling Data Center Knowledge, “Salute Mission Critical brings to the table a disciplined, reliable and flexible organization adapting to a very aggressive EdgeConneX business model domestically in the US as well as Europe. Deployments are accurate and swift, allowing us to ‘turn on a dime.'” Working with veterans isn’t without challenges, however. Many are returning from conflicts abroad with emotional scars, such as PTSD, that are a natural result of being exposed to war. For that, Salute partners with the VA to get them the help they need. Homelessness is also an issue. “Twelve to 13 percent of the veterans we hire are homeless,” Kirby said. “We don’t always know they’re homeless when we hire them. We work with the homeless programs in various cities, too, to know which veterans are looking for jobs that are in their homeless programs.” Kirby points out that although a lot of companies are very public in their desire to give jobs to homeless veterans, they’re often not prepared to cope with the many special needs the homeless bring to the table. “Most homeless veterans need to be paid every day in cash until they can get on their feet, get their bills paid and start getting lights turned back on and things like that,” he explained. “We set up our system from the beginning to accommodate that type of model. They [clients] can work with us and we can bring the homeless veterans in, get them on their feet and work with them with their special needs, because we’ve got a variety of programs through the VA that get them help if they need it — but also get them into the job and get them some income.” The income from Salute offers a living wage even to the lowest paid employee. The minimum starting pay is $15 an hour, and salaries of $60,000 a year and more are possible after they gain skills and experience. “We have more advanced training that we can put them through, and there are a lot of courses that are out there that are available online for free that are great. They go through and get those certificates and they start deciding what they like — are they going to go the facilities route or the IT route, for example — and we get them through it and get them the experience in those jobs so they can go in and start doing it.” Merely adjusting to civilian life is also a big problem for many returning veterans — especially those who liked the comradery and discipline of life in the military. The solution to that is built-in to the Salute organization, which has a DNA that’s very much like the military. “We had a team out in Oregon for two weeks, and one of the guys we had hired locally — we didn’t know it at the time — was homeless. It turns out, he was living in his car with his pregnant wife, son and daughter. The team brought him in. They double bunked in the other rooms so he and his family had a place to stay for two weeks while he got on his feet, got through the project and got enough money to get into a modest apartment. They did that without us even knowing about it — we found out afterwards. “It just brings a tear to my eye thinking about that brotherhood of never leaving a comrade behind and making sure that they took care of somebody on the team that they had never met before, just because he needed help and was a brother veteran.” (Comment on this)
2:02p	Cincinnati Bell to Buy Hawaiian Telcom, OnX for $851 Million (Bloomberg) — Cincinnati Bell Inc. agreed to buy Hawaiian Telcom Holdco Inc. for $650 million and OnX Enterprise Solutions for $201 million as the Midwestern landline carrier joins the race to build bigger fiber networks to handle soaring internet traffic. Cincinnati Bell will pay about 60 percent cash and 40 percent stock for Honolulu-based Hawaiian Telcom, while Toronto-based OnX will be bought with cash, according to the agreements. The combined company will have 14,000 route miles of fiber and access to an undersea cable connecting with Asia. For the past decade, U.S. landline phone companies have lost customers to wireless providers and cable companies. This has created a rush by carriers like Cincinnati Bell, CenturyLink Inc. and Windstream Holdings Inc. to consolidate with an eye on amassing greater fiber-optic network capacity. These buried cables are expected to be the vital infrastructure needed to meet surging demand from businesses putting more data on the cloud, consumers streaming more videos, and wireless carriers handling more traffic with new fifth-generation, or 5G, networks in the coming years. “Our focus for the past several years has been investing in fiber,” Leigh Fox, Cincinnati Bell’s chief executive officer, said in an interview. “We have a dense local fiber network but we were only growing slowly outside Cincinnati. With Hawaii and OnX, we’re creating a national player.” The combined company will have a net operating loss, or NOL, tax credit exceeding $300 million, saving it from cash tax payments for several years, Cincinnati Bell executives said on a conference call Monday. The combination will also yield about $21 million in cost synergies over a two-year period, the executives said. Cincinnati Bell’s revenue rose about 1.5 percent last year to $1.19 billion while Hawaiian Telcom’s stalled at $393 million. Both are predicted to see revenue fall by about 3 percent this year, according to estimates compiled by Bloomberg. Hawaiian Telcom Shares of Hawaiian Telcom rose 19 percent to $29.06 at 10:08 a.m. in New York, their highest price since 2014. Cincinnati Bell shares fell 9.8 percent to $17.45. Hawaiian Telcom has about 500,000 customers in Honolulu and provides services to the other islands in the chain. The company was purchased in 2005 from Verizon Communications Inc. by Carlyle Group LP, the Washington-based private-equity firm, for $1.6 billion. The Hawaiian company restructured and exited bankruptcy in October 2010. Under the agreement, Hawaiian Telcom holders will have an option of receiving $30.75 in cash for each of their shares — about a 26 percent premium to the June 7 closing price of $24.44 — or a combination of cash and stock in Cincinnati Bell. OnX provides data storage and cloud services to businesses in North America and the U.K. The Canadian company is closely held and majority owned by Marlin Equity Partners. The Cincinnati-based company’s geographic stretch into the Pacific isn’t as incongruous as it may seem, Fox said. ‘First Step’ “You don’t need to be adjacent with network assets,” Fox said. “We saw how the Hawaii team has invested heavily in fiber. The way I looked at it, I’m effectively buying another city.” “I view this as our first step,” he said. “Our share price has been flat as board for several years. If we want to move that, we need to expand. I think there will be additional steps down the line.” Cincinnati Bell has secured financing commitments from Morgan Stanley Senior Funding Inc. to provide cash for the deal and to refinance Cincinnati Bell and Hawaiian Telcom’s existing debt. Cincinnati Bell expects to close the Hawaiian Telcom deal in the second half of 2018. Moelis & Co. and Morgan Stanley are financial advisers to Cincinnati Bell, and Stephens Inc. is also a financial adviser for the OnX transaction. Cravath Swaine & Moore LLP, Morgan Lewis & Bockius, and BosseLaw PLLC served as legal counsel for both transactions. UBS Group AG is the financial adviser to Hawaiian Telcom, and Gibson Dunn & Crutcher LLP is serving as legal counsel. Raymond James Financial Inc. is acting as financial adviser to OnX, with Schulte Roth & Zabel LLP as legal counsel. (Comment on this)
5:00p	When Clouds Break: the Hidden Dangers of Cloud Computing Alex Lesser is Executive Vice President of PSSC Labs. Today’s companies are often faced with the complex decision of whether to use public cloud resources or build and deploy their own IT infrastructures. This decision is especially difficult in an age of mounting data requirements when so many people expect limitless access and ultra-flexibility. For these reasons, cloud computing has become an increasingly popular choice for many organizations – though not always the right choice. According to Right Scale’s 2017 State of the Cloud Survey, 85 percent of enterprises have a multi-cloud strategy. Common reasons for using public cloud resources include scalability, ease of introductory use and reduced upfront costs. In many ways public cloud usage is considered the “easy button.” However, cloud computing does present many drawbacks that often come back to haunt users, such as skyrocketing fees, poor performance and security concerns. The decision between using a public cloud versus owning your own infrastructure is not so different than deciding between renting and a buying a home.  It is a choice between controlling your own environment versus living within someone else’s domain. The home owner (or public cloud provider) reaps the benefits of equity gains while the renter continues to pay someone else’s mortgage. When Clouds Break, Not Everything Is So Sunny Some enterprises choose cloud services for their scalability. Although the pricing model for cloud computing is “pay for what you use” and buy more computing power as your business demands, this may not be as cost-effective as it initially appears. Organizations that move significant amounts of data should think twice before moving to the cloud because bandwidth prices can be all over the map. Bandwidth prices for cloud computing can easily rack up unexpected costs, especially when dealing with performance and security setbacks. In fact, trading algorithm developer Deep Value estimates that using Amazon EC2 is 380 percent more expensive than having an internal cluster. insideHPC.com’s Rich Brueckner described the claim that cloud services could lower the cost of high-performance computing as being “owed more to marketing hype than to reality.” The big three providers, Amazon EC2, Microsoft Azure and Google Cloud Platform have massive buying power, however between them the average bandwidth price is 3 to 4 times higher than colocation facilities. Amazon does offer the ability to reduce some of the expense by offering reserved instances. However, this can cripple a company’s cash flow. With all these added expenses, on premise hardware starts to make more financial sense, especially for businesses with predictable workloads. Many IT departments choose cloud services to improve access for remote employees and find an inexpensive solution to run data center applications. Clouds have also been praised for handling non-sensitive needs and non- mission-critical data that are not utilized for long periods of time. They can be ideal for start-up or business-to-consumer companies who are not working with large amounts of sensitive data.  However, public cloud services have always been large targets for breaches and attacks, especially if they are well- known and frequently used services like Amazon EC2. For Amazon Web Services Users’ security can be automatically affected by anything that happens to their cloud provider. Additionally, anyone using a public or shared cloud can experience a data breach and information loss through no real fault of their own. This drawback makes public clouds a potential nightmare for enterprises running mission-critical applications with high-availability and compliance or regulatory requirements. Cloud customers also encounter problems with performance and reliability. Using a public cloud means sharing a network with potentially “noisy neighbors” that hog resources. Given that cloud service providers have servers in several dispersed locations, users can also experience latency issues and are often forced to pay exorbitant fees for a solution to these issues. AWS customers, in particular, experience performance glitches with server virtualization. In contrast to bare-metal hardware users, public cloud customers have limitations on resource availability and may struggle with application performance and data transfer rates. The solution from service providers – pay more money for premium access – only adds to the headaches. When Is It Time to Deploy Infrastructure? Several factors determine when it is time to leave a public cloud and deploy on premise infrastructure. At the top of this list is the monthly spending statement. For some companies the $30,000 monthly Amazon bill is the threshold at which it is time to consider a move from the public cloud.   For other companies, the decision to move away from a public cloud is tied to performance and security issues. In-house infrastructure allows companies to control their computing environments to best ensure application success—leading to performance that is much more predictable and consistent. As a result, deploying on premise infrastructure is best for high-scale IT environments that process a lot of data, especially if that data is consistently growing.  Organizations also have the option of building dedicated servers for workload-specific needs. In a Wired magazine article, Dropbox outlined their journey leaving Amazon. According to Dropbox’s Vice President of Engineering, Aditya Agarwal, “Nobody is running a cloud business as a charity. There is some margin somewhere.”  Companies working at a large enough scale can save huge sums of money by cutting out the public cloud provider. Companies should also be cautious that Amazon, with arms in such a vast number of industries, may in the future offer online applications that will compete against those of their own customers, something Dropbox noted as part of their decision making. Giving a potential competitor insight into your business model, applications and customer base could be a risky endeavor. The Solution The conversation about where and how to store an organization’s data is a hotly debated topic in IT. In some cases, the solution is a combination of services. While some enterprises may be better suited for in-house servers, others could certainly benefit from using a public cloud. Just as frequently, an organization’s IT needs can be met by a hybrid of the two, such as implementing in-house servers to handle standard traffic which can burst to the cloud for additional capacity. However, organizations need to seriously consider their own IT needs outside the hype of the cloud, placing focus particularly on specific applications. This includes prioritizing requirements for processing, performance, storage, security, data transfers and, of course, determining how much they are willing to spend on all factors. There is an unmatched value in building and owning your infrastructure instead of living in someone else’s environment. Companies should take a long-term approach of making their IT environment an asset rather than a cost center. Spending today on in-house infrastructure results in equity, and ultimately leads to long-term profits that will support the growth of not only the IT organization but the larger business of which it is a part. Opinions expressed in the article above do not necessarily reflect the opinions of Data Center Knowledge and Penton. Industry Perspectives is a content channel at Data Center Knowledge highlighting thought leadership in the data center arena. See our guidelines and submission process for information on participating. View previously published Industry Perspectives in our Knowledge Library.   (Comment on this)
6:19p	Report: Massive Internet Disruption Costing Somalia $10M a Day Brought to You by The WHIR An extended internet outage in Somalia is being called a “major disaster” to the war-torn country’s economy. The outage across the country’s south, including the capital Mogadishu, was caused by damage to an undersea fiber-optic cable two weeks ago, and is costing $10 million per day according to the government. “We lost $130 million (about Sh13.5 billion) only in the past two weeks after missing the services which was the lifeline of our people,” said Somali Minister for Posts, Telecommunication and Technology Eng Abdi Anshur Hassan, according to the Xinhuanews agency. Hassan says that work to restore the cable has begun, and services are expected to be restored this week. The cable, which connects Somalia to Kenya, began operating in 2013. Africanews reports that officials have blamed a commercial ship for damaging the cable on June 23. Congo-Brazzaville also experienced a 15-day long disruption of internet services in June after a submarine cable was cut. Just 1.6 percent of Somalian population was online in 2014, according to International Telecommunication Union research reported by the BBC. 3G service has been unavailable in southern Somalia since 2014, when the government cut it off in response to a threat from al-Shabab militants, and satellite internet is reported to be slow and too costly for many Somalis. (Comment on this)

<< Previous Day

2017/07/11 [Calendar]

Next Day >>