CA’s BTCS2.1: Where Do We GrOw From Here?
Jun14

CA’s BTCS2.1: Where Do We GrOw From Here?

At last week’s second annual Built to Change Summit CA Technologies updated analysts and journalists on where it and the markets it’s pursuing — primarily DevSecOps, with a heaping helping of mainframe — are, where they’re going, and how the software toolmaker will grab a bigger slice of the rapidly growing digital transformation (DT) pie, which is being largely driven by software, and more specifically, applications. While the money being lavished on DT and DevSecOps are staggering, CA’s ability to grow with this opportunity remains at best a work in progress, with relatively flat sales and forecasts. Based on the market data, CA should be in the DT/DevSecOps sweet spot, and poised for rapid and sustainable growth. According to a new report, IDC’s forecast for the global DevOps software market — in excess of $5.6 billion by 2021 — was way off. MarketsandMarkets predicts that CA’s future has a much bigger potential upside — $10.31 billion by 2023 — up from $3.42 billion in 2018. Even better for CA, the market growth will be powered ‘due to the increase in the adoption rate of Artificial Intelligence (AI) and machine learning among enterprises.’ So all that remains to be seen is if CA can continue to grow with the software-enabled, data-driven, digital transformation business phenomenon that will run on DevSecOps, while reducing, if not eliminating, the shackles of its legacy businesses and embraces software-as-a-service and more flexible pay-as-you-go consumption models. It faces many competitors — including IBM, Micro Focus (HPE), Puppet, Red Hat, Microsoft and Chef Software — and must continue to innovate at speed, and execute with precision and agility. That’s a lot to ask, but for a company that’s been around since 1976, probably not too much. Automation, AI and ML were front and center at BTCS 2, and while the company didn’t coin this phrase — “Software is eating the world but AI is eating software” — it was critical to the company’s future, said Ashok Reddy, Group GM, DevOps. He and other company execs, made it clear that artificial intelligence and machine learning were being aggressively pursured in a multitude of initiatives and products. Just prior to the summit, CA’s CTO and EVP Otto Berkes said there is “massive potential” to apply machine learning and machine intelligence. amd that the company has some “very pragmatic solutions” already in the market, and is doing a “lot of experimentation” on machine learning and machine intelligence. They figured prominently in last weeks product initiatives, as well as a number of its boundary-stretching initiatives, i.e. CA Accelerator, its internal fail-fast venture-capital program, and its Strategic Research intiative, under which a...

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CA’s BTCS2.0: Change Is The New Normal
Jun07

CA’s BTCS2.0: Change Is The New Normal

SANTA CLARA, Calif.: Determined to be the leading toolmaker for the software-enabled, data-driven, digital transformation business phenomenon that is reshaping the world, CA Technologies held its second annual Built to Change Summit to update analysts and journalists on where it is, and where it wants to go. At last year’s BTCS the venerable software developer (1976) detailed how it was transitioning from a $4-billion legacy software giant with relatively flat sales into a more agile and fast-growing DevSecOps vendor for the the rapidly emerging DT world. Fast-forward 11 months and the company reported quarterly and annual revenue increases to $1.083 billion and $4.235 billion, respectively, and is forecasting relatively flat growth for the next quarter. In addition to its financials, CA also announced it would be laying off 800 (out of 11,000 employees) in restructuring, and adding another 500-600 staff with ‘different skills’. The company needs fewer employees with skills related to “legacy platforms” and more with skills related to software as a service, said CEO Michael Gregoire. While the company’s roots are in the mainframe, which is undergoing something of a renaissance, it is DevOps and more specifically DevSecOps where it’s future lies.Depending upon your source, DevOps is a flourishing market, especially in the enterprise. Forrester Research declared 2017 to be the year of DevOps with 50% of organizations implementing it, and 2018 will be the year of enterprise DevOps. ‘DevOps has reached “Escape Velocity”’, noted Principal Analyst Robert Stroud, with momentum occurring within all industry sectors but with healthcare, banking, insurance and manufacturing sectors leading the charge. In addition to forecasting a global DevOps software market in excess of $5.6 billion by 2021, IDC offered some interesting predictions that should sit well with CA’s DevSecOps ambitions, including: -cognitive computing, artificial intelligence, and machine learning will become the fastest growing segments of software development by the end of 2018; by 2021, 90% of organizations will be incorporating cognitive/AI and machine learning into new enterprise apps -by 2019, over 70% of routine development-lifecycle tasks will be automated, supported by AI fed from existing data streams, with an agile DevOps pipeline driving and incubating lifecycle and application development intelligence; -by 2021, over 50% of CIOs will have appointed heads of delivery; integrated their dev, PMO, and ops groups; reduced silos; expanded their DevOps practices; and implemented shift-left testing to accelerate innovation; and, -development without integrated security and compliance will fail; progressive orgs have prioritized security due to uptime and compliance concerns, accelerating the need for agility and a curated OSS-dev portfolio. Security-led development will be a priority for 90% of orgs by 2020. 451 Research (together with security software testing...

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Will AI Keep Pure “growing like a bat out of hell”?
May31

Will AI Keep Pure “growing like a bat out of hell”?

Having accelerated from start-up to top-five vendor in the red-hot flash array market, Pure Storage is looking for new heights to scale. While it still has plenty of opportunity remaining in the storage segment, it is trying to broaden its horizons with a number of new initiatives, including a data-centric architecture, storage as a service and one of the latest buzzword-bingo catchphrases, artificial intelligence (AI) and machine learning (ML). “We were ahead of the market in all-flash,” said Pure Storage CEO Charlie Giancarlo in the earnings call earlier this month. “We were ahead of the market with NVMe. And we’re ahead of the market with AI.” At last week’s PURE//ACCELERATE 2018, its third annual customer/partner event, the company continued its AI push, which first surfaced with the NVIDIA partnership in March. It also made a number of other announcements intended to broaden its reach beyond just faster, smaller, less-complex and more-energy-efficient storage, which has fuelled its meteoric rise, including 40% year-over-year revenue growth last quarter.. “We’re guiding generally to 30+% year-on-year. We aspire to grow just as fast as we possibly can. Part of that is the market, part of that is one’s ability as a public company to scale without wanting to sacrifice quality,” said Giancarlo. “Last year was a great milestone for the company. We also have $1 billion in the bank. We are cash flow positive and are growing like a bat out of hell,” he added. “We’re not just enterprise storage. We’re in a very great place.” Pure faces stiff competition in its core business, the c (7%). However, it’s even further behind in the overall enterprise storage market, which rang up sales of $13.6 billion in Q4, compared to AFA’s $1.9 billion. Although it is looking at a total addressable market of $35 billion, the lights are much brighter in the AI segment, which is expected to generate $1.2 trillion in economic value this year, up 70% from 2017, and projected to add just under $4 trillion by 2022. “The interest in AI by corporations is just off the charts,” said Giancarlo in a recent interview. “At Pure, we are able to…feed GPUs, high speed applications, and AI environments — at the speed they want that data to provide the intelligence companies want to make their businesses better.” He said since AI is all about crunching huge amounts of data, older, tiered storage systems that rank data by age aren’t nimble enough to grant researchers quick access to even the oldest data sets. “These days, people want access to data, whether it was last week or last year or last decade,” Giancarlo said. Pure...

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Flash, AI Help Fuel Record Growth, Bright Future For Pure Storage
May24

Flash, AI Help Fuel Record Growth, Bright Future For Pure Storage

SAN FRANCISCO: I’m in the City by the Bay attending PURE//ACCELERATE 2018, the third annual customer/partner event from Pure Storage, and it appears the enterprise flash storage vendor couldn’t have scripted the timing any better. In addition to its new partnership with NVIDIA — AI-Ready Infrastructure (AIRI), a ‘major move in serving the artificial intelligence (AI) and machine learning (ML) space’ — and its ongoing relationship with Cisco — i.e. as an Original Storage Manufacturer (OSM) — on Monday the company reported Q1 revenue of $255.9 million, up 40% YoY. “Pure has delivered another strong quarter as we lead the industry in delivering new data-centric architectures that enable enterprises to succeed both today and tomorrow,” said Pure CEO Charles Giancarlo, in a prepared statement. “The combination of our innovative business model, first-to-market technology innovations, and focus on customer success drove continued momentum in Q1.” In addition to record revenues, the company announced it had added 300 new customers during the quarter, bringing its installed base to amost 5,000 organizations. It forecast an even better Q2 — $296 million to $304 million — and approximately $1.345 billion for the year, up from 2017’s $1.023 billion, as well as a slightly higher net loss, $64.3 million compared to last year’s net loss of $57.2 million. “We were ahead of the market in all-flash,” said Giancarlo in the earnings call. “We were ahead of the market with NVMe. And we’re ahead of the market with A.I. (artificial intelligence).” At last year’s event — more than 3,000 customers, partners and staff (with another 2,000 online, for a total increase of 300% over 2016’s inaugural event) — the vendor was predicting at least three more years of 30%-plus revenue growth, surpassing the $2-billion annual revenue mark by 2020. It also stated that the total addressable market for its faster solid-state storage arrays is $35 billion, but according to Dave Vellante, chief analyst of Wikibon, Pure was involved in a knife fight, and a market ripe for consolidation. “If it can stay ahead of what I call the ‘storage cartel,’ it will emerge a winner.” Shortly after last year’s event the company hired Giancarlo, formerly the Cisco CTO and then Avaya CEO,  who took over as CEO in late August when Scott Dietzen was bumped up to chairman of the board. Late last year he told Zeus Kerravala, founder and principal analyst with ZK Research, that if “you had asked me at the beginning of 2017 if I would join a storage company, I would have said probably not. I was caught up in the conventional wisdom that the storage industry had reached its zenith,...

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DTW18 & Connecting The DoTs (Part 1 of 3)
May10

DTW18 & Connecting The DoTs (Part 1 of 3)

LAS VEGAS: During one of my Dell Technologies World 2018 briefings last week I had to stop part way through and explain that I meant digital transformation, not Dell Technologies, when I used the DT acronym. The business phenomenon digital transformation (AKA digitization or Industry 4.0) and its related technologies — cloud computing, Internet of Things (IoT), big data and analytics (BDA), mobility, social media and security — is literally an extinction-level event — it’s ‘go digital or die’. While clarifying acronym anomalies is not a unique experience, it made me think of the greatest challenge I see facing Dell: how will the biggest IT infrastructure vendor — i.e. products and services — continue to prosper when the customer focus is moving to business outcomes, and not the bits and bytes that facilitate those outcomes? The answer is “better than everyone else.” I don’t think it’s hyperbole to say Dell is better-positioned than every other vendor out there. That’s not to say countless companies won’t provide one or more superior offerings in the fast-emerging software-driven, cloud-first IT environment, but that when it comes down to the vendor to trust most — and most often — it will probably come down to Dell. During his opening keynote to the approximately 14,000 customers, partners, employees, media and analysts in attendence — and an estimated 35,000 online — Michael Dell talked in generalities, stressing digital (along with IT, workforce and security) transformation  and the latest buzzword trifecta — AI (artificial intelligence), ML (machine learning) and NN (neural networks), ‘Make It Real’ (the event’s DT theme), and how “our customers are using technology to change the world for the better, whether through a reimagined process or a reimagined industry.” He noted that since starting the company 34 years ago, it had grown to over a trillion dollars in revenues and a trillion customer successes but all that is “absolutely noting compared to what’s ahead.” The DT future — with or without Dell — is incredibly bright: spending on related hardware, software and services is expected to reach approximately $1.3 trillion in 2018, a 16.8% year-over-year increase, and continue growing at a compound annual growth rate of 17.9% through 2021 to more than $2.1 trillion. And the reasons so much money is being thrown at DT initiatives are equally compelling, as Dell (along with Intel and the Enterprise Strategy Group) told us in survey data released last month: -transformed companies are 22x more likely to get new products and services to market ahead of the competition; -81% of firms (4,000 were surveyed) agree if they do not embrace IT Transformation, their companies will no...

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DWT18: The Premptive Prequel
Apr26

DWT18: The Premptive Prequel

In the increasingly cloud-first IT environment the misperception persists that “Infrastructure? We don’t need no stinkin’ infrastructure” is the ‘truth’. However, somewhere, somebody is supplying hardware, software and services to a datacenter to enable the cloud to function. Just ask cloud’s dynamic duo, Amazon and Google (and Microsoft), who helped more than double the amount spent on datacenters last year. While ODMs (original design manufacturers), whitebox servers and switches and public-domain software continue to proliferate, it comes down to three primary vendors in the broadline enterprise infrastructure business: IBM, HPE and Dell EMC. Big Blue looks like it has gotten it’s act together and is once again the profit-generating machine we’ve known forever (1Q18 $19.1 billion), while the post-Meg-HPE appears to be taking its new smaller-is-better philosophy and making a go of it (FY1Q18 $7.7 billion). Meanwhile the world’s largest private technology company, Dell EMC/Technologies, which is holding Dell Technologies World, its annual customer event, next week in Las Vegas, has continued to prosper (FY4Q18 $21.9 billion), despite running up a truly massive debt with its EMC acquisition (approximately $46 billion). The company borrowed billions to go private in 2013, and then a lot more billions ($52 billion?) to buy EMC n 2016, so while the amount still owed is impressive, the amounts paid off – around $10 billion – are equally impressive. The numbers were much less impressive for storage revenue ($13.6 billion), where HPE edged out Dell EMC for the fourth-quarter, 18.9% versus 18.0%. While IDC noted that “Investments on enterprise storage systems are increasing at a very healthy pace,” the original design manufacturers (ODMs) that sell directly to hyperscale datacenters recorded the biggest increase – 34.3% year over year – to just under $2.8 billion. Gartner puts overall Q4 server revenues up 25.7% year-over-year, on just an 8.8% YoY increase in shipments. Dell EMC won bragging rights, with top spot for the year (19.4%), up 39.9% in Q4, versus HPE (19.3%), on a respectable 5.5% increase in Q4. For the year, shipments were up 3.1%, while revenues jumped 10.4%. The latest numbers from IHS Markit show that Dell has supplanted HPE atop the datacenter server revenue heap. For the fourth quarter of 2017 Dell EMC accounted for17.9% of the market, worth $3.6 billion, just edging out white boxes (17.6%), and HPE (17.1%). The numbers are troubling for the non-ODMs, as white box shipped more units (24%), and while enterprises accounted for 44% in Q4 and 48% for the year, that segment is slowing down as cloud service providers (41%) are expected to overtake enterprises in 2019. Overall, Dell reported a 9% increase in quarterly revenues, and...

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