Analysis

Dell bets on Oracle alliance and converged infrastructure

Archana Venkatraman

Dell has expanded its partnership with Oracle to introduce a new x86 infrastructure product that will ease customers’ deployment of Oracle applications on Dell’s infrastructure.

The announcement came at Dell’s enterprise forum in San Jose, where the company also unveiled its latest converged infrastructure offering.

Dell-enterprise-forum1-2013-290x230.jpg

With the collaboration, Dell has named Oracle a preferred enterprise infrastructure partner, including Oracle Linux, Oracle VM and Oracle Enterprise Manager, while Oracle has made Dell its preferred x86 partner. 

The alliance, which combines Dell’s datacentre hardware and Oracle’s enterprise software, will provide customers with IT solutions at lower costs and increased value, and provide them with a single point of contact for support services, said Marius Haas, president for Dell’s enterprise solutions.

The integrated offering, currently termed Joint Infrastructure Solution, will be available to customers in the second half of 2013.

The companies are currently testing and validating the offering as an application-ready platform for enterprises.

“This partnership with Dell is an extension of Oracle’s engineered systems strategy, where we simplify IT and reduce integration costs by delivering hardware and software together,” said Oracle president Mark Hurd. 

But what do analysts, service providers and customers make of the move?

Dell and Oracle alliance well received

“The alliance is strategic, in that Dell will now be able to sell its hardware with fully integrated software, which includes Oracle middleware, Oracle enterprise manager and Oracle Linux,” Randy Kerns, senior strategist at analyst firm Evaluator Group, told Computer Weekly. 

“On the other side, Oracle was finding it difficult to penetrate the x86 market, and will use Dell’s reach into the enterprise to expand its software footprint,” he added.

The news is good for customers using Oracle on Dell, as the alliance is establishing a single point of support contact, said Kerns.

“I like the integration, because one challenge for us now is that we are scared to make any tweaks to Oracle applications, worrying what if it doesn’t work well in our Dell infrastructure,” said Douglas Smith, senior systems engineer at TIG, Canada. 

“Oracle works best in Oracle infrastructure, and it is good to see that it is seeing advantages in collaborating with Dell, which has deeper reach in enterprises’ datacentres,” he added. “The collaboration will mean that Oracle apps will work well in Dell infrastructure too.”

Smith also hopes the testing and validation will help the companies deliver the offering with a set of reference architectures for easy deployment.

Service provider Pete Partee, who sells Dell and Oracle, said the announcement was good news, but pointed out that they have only shared an overview so far. "They haven’t given us the product yet, so we don’t know exactly how the new product will help the enterprises,” he said.

Dell’s Haas called the alliance “unique and preferred”. “Oracle isn’t doing this with everyone else,” he said, suggesting the move is a snub to HP – Dell’s rival and Oracle’s former partner.

“I don’t know if the move is meant to be a slap on HP’s face, but it is a very smart move for both companies and it definitely means more competition to HP,” said Kerns.

Dell’s converged infrastructure offering and strategy

The collaboration will mean that Oracle apps will work well in Dell infrastructure too

Douglas Smith, TIG

Other highlights of the enterprise forum include Dell’s launch of new datacentre products. It introduced PowerEdge VRTX, a converged infrastructure product that is targeted at small offices and remote enterprises such as smaller retail outlets of big supermarket chains.

Priced at $10,000, VRTX will be able to support up to four servers running as many as 100 virtual machines and about 50TB (terabyte) of storage, said Forrest Norrod, vice-president and general manager of Dell Server Solutions.

A “private cloud in a box”, VRTX is optimised for applications and workloads from branch office to scale-out datacentre, he said.

Dell’s deeper foray into converged infrastructure comes at a time when analysts such as IDC predicted that spending on converged systems will grow at a compound annual rate of more than 54% between 2011 and 2016, driven by the cost advantages and efficiency related to operations and management of IT, simplification of supplier engagement, and faster time to productivity with IT system updates. 

Special report: Dell

On the consumer side, Dell revolutionised product distribution by using e-commerce to compress the supply chain, and it pioneered the commoditisation of enterprise IT hardware. One development enabled Dell to scale up its own sales operation, while the other enabled countless customers to scale out their back-end computing operations. Now, the tables are turning and the industry is shifting underneath Dell. Can it adapt?

Dell also launched its enterprise-level converged infrastructure offering – Active Infrastructure 1.1. It will help enterprises speed up IT services delivery, improve datacentre efficiency and strengthen IT service quality, said Dell’s enterprise segment vice-president Dario Zamarian.

It also announced the next version of its modular datacentre that will give enterprises more flexibility and operational capacity.

Dell’s datacentre and converged infrastructure strategy comes after it saw first quarter 2013 profits plummet by 73% to $226m (£149m) as its hardware division's profits were in freefall. It also emerged that Dell's services division now contributes more than half of overall profits, compared with one-third in the first quarter of 2012.

 


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