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Top data center industry news stories so far in 2017

The data center market moves quickly, so it's important to stay abreast of the latest news. See which product launches and emerging IT strategies made headlines so far this year.

In the first half of 2017, the data center industry experienced a flurry of activity that ranges from mergers and acquisitions to product launches and user concerns.

One of the most significant developments was Hewlett Packard Enterprise's acquisition of hyper-converged pioneer SimpliVity, which raised questions about support and pricing. Additionally, the argument for on premises strengthened as CIOs moved workloads back from the public cloud.

Here's a look back at five of the top data center industry news stories in the first half of 2017 -- and what they mean for admins.

HPE-SimpliVity deal creates customer concern

In January, Hewlett Packard Enterprise (HPE) said it will acquire SimpliVity for $650 million to strengthen its hyper-converged infrastructure (HCI) strategy, which caused some customers to fear the unknown consequences of the deal.

With SimpliVity acting as the common data fabric, HPE, through the deal, could become more agnostic and support multiple stacks, such as OpenStack and VMware, said Gina Longoria, an analyst at Moor Insights and Strategy, back in January. Through the use of SimpliVity software to add more data services, HPE could also expand and bolster its existing HCI products. And HPE's enterprise footprint could help boost SimpliVity's appeal to larger customers.

However, some users in the data center industry said they won't reap any benefits from the deal. At best, they said, the acquisition won't affect them at all. But, at worst, there could be an increase in price and a decrease in support and development.

Cisco updates HyperFlex to stay in the HCI game

In an attempt to stand out in the saturated hyper-converged market, Cisco in March updated its HyperFlex 2.5 system with coengineered software from Springpath. The update coincided with HPE's reveal to soon sell SimpliVity OmniCube hyper-converged appliances on HPE hardware.

Last year's offerings from Cisco and Springpath were architecturally sound, but had some functional deficits and lacked enterprise features, said Richard Fichera, vice president and principal analyst at Forrester Research, in March. This year's updated product, on the other hand, includes features that are important to enterprises, such as increased performance for top-tier enterprise workloads, the option of up to a 40 Gigabit Ethernet interconnect, all-flash storage, native replication, encryption at rest and integration with Cisco's CloudCenter cloud management tool.

Although HyperFlex 2.5 lacks the erasure coding offered by VMware vSAN and Nutanix, its CloudCenter integration should help customers in the future, especially as they look to manage and migrate data from on premises to cloud with a common management platform.

IBM invests in AI, open source 

It was no surprise to see IBM take an interest in open source, since the company has advocated the technology since backing the Eclipse Foundation in 2001.

At the InterConnect conference in March, IBM looked to shake up the data center market with a number of new services related to cloud, artificial intelligence (AI), open source and blockchain.

Examples of the company's refocused strategy included a blockchain service built on the Linux Foundation's Hyperledger Fabric 1.0, which can create production blockchain networks on IBM's cloud. Another new offering, IBM Cloud for Financial Services, incorporated AI and open source, and it offers tools to create financial services applications with cloud, blockchain and analytics capabilities.

It was no surprise to see IBM take an interest in open source, since the company has advocated the technology since backing the Eclipse Foundation in 2001. As IBM and other companies influence open source through products such as blockchain, increased capabilities should improve application development productivity.

While emerging technologies such as AI and blockchain are at the heart of IBM's long-term strategy, it will take time and education for IT shops to incorporate them into their own. However, new technologies like these could drive IBM forward in a similar way the mainframe has in the past, said Charles King, president of Pund-IT, in March.

Azure Stack adds Cisco, raises pricing questions

When Microsoft in February added Cisco Unified Computing System to its list of options for Azure Stack appliances, it fueled an ongoing question within the data center industry: How much will it cost? The move came as users continued to wonder about licensing models for Azure Stack.

Analysts predicted earlier this year that when Azure Stack becomes available through its OEM partners, Microsoft will choose a competitive entry price. There will be some differences in pricing between each OEM vendor, but all appliance flavors will attempt to alleviate the complexity of setup, said Carl Brooks, an analyst at 451 Research, back in February.

Compared to the costs of running Azure Stack on cheap commodity hardware to make a private cloud, Azure Stack services will be overpriced, Brooks said. But with guaranteed support and maintenance, along with guidance on implementation and deployment, the hefty cost could be worth it for many customers.

Microsoft in March did reveal some pricing structures related to Azure Stack. For example, the technology will offer a bring-your-own-license option, meaning that OSes and applications -- including SQL Server -- that have existing Enterprise Agreements can run in an Azure Stack VM for just the cost of that VM.

In 'boomerang effect,' CIOs move workloads back on premises

The endless on-premises versus cloud computing debate ramped up this year, as data centers experience the "boomerang effect" -- when cloud workloads from return to on premises. Almost two out of three CIOs brought workloads back to their data centers, according to a Pacific Crest Securities survey from earlier this year.

The boomerang effect often occurs with technology companies and larger enterprises, such as Nasdaq. The American Stock Exchange had implemented a cloud push, for example, but reversed course once it discovered the surprisingly high price tag of its monthly public cloud bills.

New companies, however, are perfect contenders for the public cloud, which eliminates the startup costs of hardware, licenses and engineers, said Andrew Hamilton, CTO at Parkmobile LLC, in January. But as companies develop, some move away from the cloud, as its initial attractions -- for example, the ability to reduce large capital expenses and purchase compute in smaller increments -- eventually wear off.

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