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Wikibon's IBM Think 2018 Trip Report: Welcome Back, IBM

For years, IBM has described a “smarter planet” and the role that technology could play to solve big problems. At IBM Think 2018, IBM initiated an effort to shift the conversation to “Let’s put smart to work.” It’s the right call-to-action for customers in the digital business era.

But it also could be interpreted as not-so-subtle prod to IBM itself. The company with more really bright and customer-obsessed employees than any other in tech has been pretty somnambulant the past few years.

In the AI, cloud, and developer platform domains, IBM has offered solutions with potential, but never seemed able to muster the energy required for leadership in today’s markets. Watson? First to demonstrate the practical potential of modern AI, but never seemed to get the pricing, packaging, and positioning right. Softlayer? Among the first to provide VMware users a path to the cloud, but eclipsed by AWS’s singular focus on cloud growth. Bluemix? An early PaaS option, but never caught fire in developer communities.

At Think 2018, 34,000 folks descended upon Las Vegas to lend their energy to IBM’s transformation. theCUBE was there, too, capturing somewhere around 65 interviews with user, partner, and IBM executive thought leaders. It was an impressive gathering, chock full of exciting conversation and spirited problem solving.

Our conclusion? Based on what we saw at Think 2018 (in both the analyst event and on theCUBE), IBM appears to be waking up. Here’s why we say that:

  • IBM has aligned its vision of IT with better generating business value from data. A few years ago, Wikibon stated that the difference between a business and a digital business is the role that data plays in a digital business. Moreover, we believe that a digital business transformation fundamentally is a process by which a business begins treating data like a strategic asset and re-institutionalizes work to better take advantage of its data assets. We were largely alone in this call, but IBM is now firmly in this camp. From Ginny Romety’s keynote to small conversations in the Las Vegas caverns that connect conference rooms, the conversations centered on what businesses can do to uniquely serve customers and compete by applying a company’s unique data assets.
  • IBM says it won’t appropriate value from your data. The problem with data assets is that data is easily copied and shared. Thus, a key feature of managing data value is how best to privatize data – and keep it unique to your company. There are two kinds of digital business suppliers: Those that seek to make money off your data and those that won’t. IBM has come down firmly on the “won’t-make-money-off-your-data” side. Partly that’s because IBM operates almost exclusively in business-to-business markets, but mainly it’s because IBM has chosen to avoid conflicts with customer businesses. Wikibon thinks that’s a very good thing, but technologies like Watson and IoT services will continuously test IBM’s commitment.
  • A product portfolio refreshed where it can do the most good – for your data. At the product level, in the last six months IBM has refreshed its Z Series, Power9 systems, and a slew of systems software products. As a result, IBM’s hardware revenue actually showed growth in late 2017. Good for the installed base. But if your focus is on data, then the emphasis has to start with storage, and that’s where the best IBM product story resides. The storage group has aggressively pivoted to flash systems, software-defined data services, and an NVMe-oF future. Why is this so important? Because arguably, the catalyst for much of the change in the tech world is the move from disk-based storage (reliably persist data) to flash-based storage (speedily deliver data). Without this change, today’s AI conversations would sound an awful lot like 1995’s AI conversations: Lots of promise, still waiting for the systems. IBM is back in storage, which will excite many huge IBM customers. And, to repeat, an NVMe-oF future heralds at least a few more years of big moves in storage from IBM.
  • New products and service to make a data difference. In addition to refreshing the existing product and services portfolio, IBM is rolling out strong combinations of newer, “data-first” technologies that have great digital business potential. None alone will set the world on fire, but IBM’s expanding commitment to cloud-based analytics, IoT, and blockchain are on point; at least if the Wikibon community is right. The company trumpeted its Cloud Brokerage Services (for managing hybrid clouds) and Cloud Private for Data (for running analytic pipelines and apps). While we saw no specific IoT products, the partnerships and services talent that IBM is bringing to bear on the edge represents industry leadership. Finally, there’s blockchain. Not coin-this-or-that, but blockchain. Blockchain heralds an important approach to adding fundamentally transactional, “data-first” networks to the internet. We’ll see enormous and rapid invention in this space, but IBM is getting in early – which is good for customers and the industry.

What Didn’t We Hear? Any show as large as IBM Think 2018 will be noisy, and we might have missed something, but three things we didn’t hear are:

  • Next-generation systems networking. While the storage team is aggressively adding NVMe-oF to the storage product line, we didn’t hear much about IBM’s play in emerging network fabrics for next-generation systems overall. Perhaps IBM’s partnerships with Cisco, VMware (NSX), and other network product providers will prove enough, but Wikibon believes that new software-defined systems networking technologies from start-ups like Plexxi, Pensa, Nuage, and others will have a major impact on, well, everything. We expect IBM will make a move in this space in 2018/19.
  • Update on developer initiatives. There’s a lot of new software to build. Indeed, digital business is about putting data assets to work through advanced software technologies. Conventions and standards for incorporating AI, ML, blockchain – any number of new technologies – into business applications are just starting to form. Google, AWS, and Azure are pushing “cloud-scale” concepts forward, but we expect to see more from IBM on this front over the next few years.
  • True Private Cloud (TPC) systems. The cloud experience is being defined by the leading hyperscalers, like AWS, Azure, and Google. That won’t change, but how the cloud experience is manifest closer to immovable data, either because of cost, latency, regulation, or IP concerns, in private cloud settings is well within IBM’s industry sweet spot. That’s the realm of on-premises or near-premises TPC. Importantly, Power9 systems are being positioned to run high-value AI workloads. Excellent. However, the Wikibon community would like to see IBM take a stronger leadership position in the TPC space overall.

Action Item.

CIOs and business leaders need to start tying digital business transformation to differentially creating, sustaining, and applying data assets. At IBM Think 2018, IBM clearly demonstrated that it has made the data leap, making it an even more relevant partner for large enterprises in the age of digital business.

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