Magic Quadrant for Integrated Systems

16 June 2014 ID:G00252466
Analyst(s): Andrew Butler, George J. Weiss, Philip Dawson

VIEW SUMMARY

The integrated system market is growing at 50% or more per year, creating an unusual mix of major vendors and startups to consider. This new Magic Quadrant will aid vendor selection in this dynamic sector.

Market Definition/Description

This document was revised on 27 June 2014. The document you are viewing is the corrected version. For more information, see the Corrections page on gartner.com.

Integrated systems are combinations of server, storage and network infrastructure, sold with management software that facilitates the provisioning and management of the combined unit. The market for integrated systems can be subdivided into broad categories, some of which overlap. Gartner categorizes these classes of integrated systems (among others):

  • Integrated stack systems (ISS) — Server, storage and network hardware integrated with application software to provide appliance or appliancelike functionality. Examples include Oracle Exadata Database Machine, IBM PureApplication System and Teradata.
  • Integrated infrastructure systems (IIS) — Server, storage and network hardware integrated to provide shared compute infrastructure. Examples include VCE Vblock, HP ConvergedSystem and IBM PureFlex System.
  • Integrated reference architectures — Products in which a predefined, presized set of components are designated as options for an integrated system whereby the user and/or channel can make configuration choices between the predefined options. These may be based on an IIS or ISS (with additional software, or services to facilitate easier deployment). Other forms of reference architecture, such as EMC VSPEX, allow vendors to group separate server, storage and network elements from a menu of eligible options to create an integrated system experience. Most reference architectures are, therefore, based on a partnership between hardware and software vendors, or between multiple hardware vendors. However, reference architectures that support a variety of hardware ingredients are more difficult to assess versus packaged integrated systems, which is why they are not evaluated by this research.
  • Fabric-based computing (FBC) — A form of integrated system in which the overall platform is aggregated from separate (or disaggregated) building-block modules connected over a fabric or switched backplane. Unlike the majority of IIS and ISS solutions, which group and package existing technology elements in a fabric-enabled environment, the technology ingredients of an FBC solution will be designed solely around the fabric implementation model. So all FBCs are an example of either an IIS or an ISS; but most IIS and ISS solutions available today would not yet be eligible to be counted as an FBC. Examples include SimpliVity, Nutanix and HP Moonshot System.

Added market complexity is created because integrated systems of different categories are frequently evaluated against each other in deal situations. For instance, because IIS solutions are generic multipurpose systems that can run a variety of workloads, it is common for one IIS to be compared with another. But users who want to deploy a specific workload might compare an ISS solution, like Oracle Exadata Database Machine or IBM PureApplication System (both of which have the workload embedded), with a generic IIS system that is also capable of running the workload, or with an IIS platform that has an applicable reference architecture. However, it would be rare to see one ISS competing with another ISS, because the choice of stacks and workload takes priority over the choice of platform. So if Oracle Database Management System (DBMS) serving is the required workload, the only viable ISS solution would be an Oracle Engineered System.

It is because these different types of systems are evaluated against each other that this Magic Quadrant assesses integrated systems as integrated infrastructure systems or the infrastructure aspects of integrated stack systems. It assesses the hardware (server, network, storage), operating system and virtualization software alongside any associated management tools and high-availability (HA) solutions. It considers hardware depth and scale, software stack management breadth and depth, and support of the infrastructure, as well as flexibility in the use of reference architectures. It does not assess any software stack, application or platform components individually, such as middleware, DBMS software and cluster software in the application or DBMS tiers.

Most integrated systems are based on blade server technology, with closely coupled storage area network (SAN) and network-attached storage (NAS), which enable boot-from-disk capability for all physical and virtual nodes; thus, the system becomes stateless. Blades are not a prerequisite, however, and some vendors will promote rack-based solutions as well. The majority of integrated systems are the effective packaging of server, storage and networking components that are sold as separate products in their own right. But we are seeing the emergence of true "fabric-based computers" that merge the three elements more seamlessly.

The great majority of integrated systems are based on Intel or AMD x86 technology, but there is some support for reduced instruction set computer (RISC) variants like Power and SPARC, and the emerging market for ARM and Intel Atom processors will have applicability for some integrated system use cases.

Magic Quadrant

Figure 1. Magic Quadrant for Integrated Systems
Figure 1.Magic Quadrant for Integrated Systems

Source: Gartner (June 2014)

Vendor Strengths and Cautions

Cisco-NetApp

While Cisco's Unified Computing System (UCS) blade technology integrates compute and switching capability, it is not considered to be a full integrated system, as it currently includes no integrated storage. The FlexPod solution — jointly promoted by Cisco and NetApp — has evolved from its reference architecture beginnings — when FlexPod was really only a certified design — to its current status as a valid integrated system that can be deployed through a variety of Cisco and NetApp partners. FlexPod is the result of many years of joint development between Cisco and NetApp of networking and secure multitenancy. For FlexPod, the two vendors have developed a new support and go-to-market model, resulting in a cooperative support program and a channel-centric go-to-market approach.

While the use of Cisco's UCS is common to VCE and FlexPod, the underpinning of each FlexPod is always Cisco UCS, NetApp Fabric-Attached Storage (FAS) and Cisco Nexus switches. Introduced in November 2010, there are now more than 3,700 FlexPod customers. FlexPod is delivered almost exclusively through channel partners. There are currently 1,000-plus partners certified to sell FlexPod, and over 90 FlexPod Premium Partners that have achieved a higher level of FlexPod certification.

Market acceptance for FlexPod has been strong, and service providers make up a significant proportion of the base. However, Cisco and NetApp also collaborate with vendors such as VMware, Microsoft, Oracle, SAP, Citrix and Red Hat to create more-focused FlexPod solutions. Microsoft and Citrix have also agreed to participate in the FlexPod Cooperative Support Program, along with Cisco, NetApp and VMware. The FlexPod portfolio has also expanded, with FlexPod Express for small enterprises and FlexPod Select for specialized workloads like Hadoop. The management tooling is not as consistent or holistic as that of many other integrated systems, and many users work with vendors like CA Technologies to create a more complete management experience. Recognizing the need for better management symmetry, Cisco has recently started supporting every FlexPod solution (by default) through its UCS Director (integrated manager) product that covers compute, network and storage setup and management, and a growing number of FlexPod users are now deploying with Cisco UCS Director.

Strengths
  • FlexPod has a single architecture (the integration of unified compute, network switching and storage) that scales from a small enterprise configuration to a large, secure, multitenant cloud infrastructure without changing architecture or technology platforms.
  • FlexPod has benefited from the fast ramp-up and track record of Cisco UCS, aided by easy access to NetApp's large customer base.
  • NetApp has good presence in smaller data centers, and works with Cisco to price and position FlexPod for a wide range of use cases, from small or midsize businesses (SMBs) to large enterprises.
  • FlexPod is validated with multiple hypervisors (from Citrix, Microsoft and VMware) and bare metal.
  • Cisco and NetApp are developing use cases for FlexPod that cover a wide range of private cloud and application-specific scenarios, including desktop virtualization (Citrix XenDesktop and VMware), and enterprise applications (including Oracle, SAP and Microsoft), big data (Hadoop).
  • The two vendors have collaborated to create a Cooperative Support Program (which is one factor that qualifies FlexPod as a valid entry in this Magic Quadrant).
Cautions
  • Because either vendor can take the lead in sales situations, users must validate the rules for account management and responsibility.
  • Users who favor the more holistic single-vendor solution from vendors such as Oracle, IBM and HP will be more likely to question a partner-dependent business model.
  • There is a lack of a uniform management software experience (although certification of Cisco UCS Director is beginning to fill this void).
  • Potential future tensions may be created by Cisco's entry into the storage market with the acquisition of Whiptail.

Dell

Dell had an early flurry into integrated systems with a conceptual "brick based" system that pioneered modular systems, but did not make it to full production. The vendor also forged high-end OEM partnerships with Egenera and Unisys to help fill the need for solution integration and infrastructure convergence. Dell has now developed a strong system pedigree, through the storage acquisitions of Compellent Technologies and EqualLogic, as well as the Force10 Networks networking acquisition. Dell's main integrated infrastructure focus is its PowerEdge VRTX and Active System offerings. Active System is targeted at virtualization and cloud infrastructure, packaged for various virtual machine (VM) configurations. Dell supports VMware and Microsoft Hyper-V for hypervisor and associated software for recovery and migration. Multiple management software, infrastructure automation and storage vendor acquisitions, such as Quest Software and Gale Technologies, are enabling Dell to build a management portfolio that addresses a wide range of needs, including common management across applications for both physical and virtual infrastructure. This is a work in progress, with many tools and interfaces yet to harmonize.

Dell PowerEdge VRTX offers an integrated server, storage and networking in a compact chassis, optimized for office environments. This shared infrastructure platform offers performance and capacity with office-level acoustics in a single, compact tower chassis. It is aimed at SMBs, as well as remote and branch offices of large enterprises. Full-functioned unified system management with Chassis Management Controller (CMC) and GeoView helps take much of the time and effort out of system administration and control. This makes it feasible to deploy, monitor, update and maintain the system through a unified console that covers servers, storage and networking. VRTX system management is integrated with major third-party management tools, protecting your installed investments and allowing you to use what you know. For example, Dell developed OpenManage Cluster Configurator for Window 2012, and Microsoft Hyper-V clusters based on VRTX. Likewise, clients using third-party consoles (such as Microsoft, VMware or Oracle) link well into Dell's embedded management for deployment and automation of infrastructure resources.

Although Dell is now a private company, we do not believe that this change in focus has a measured impact on its enterprise server business or its inclusion in this Magic Quadrant.

Strengths
  • The vendor has strong individual product sets, especially PowerEdgeVRTX and Active System.
  • There is a good cloud and virtualization platform around Active System, the result of Dell's acquisition and integration of Gale Technologies.
  • Strong SMB and remote location play is provided by PowerEdge VRTX.
  • There is good integration of EqualLogic blade array storage for workloads such as virtual desktop infrastructure (VDI) and analytics.
Cautions
  • A fragmented uber-strategy makes the integrated system portfolio appear disjointed, with no common management.
  • There is limited enterprise credibility for supporting software stacks on top of integrated infrastructure.
  • Despite numerous acquisitions, Dell still lacks awareness in management software, compared with many of its peers.
  • Despite a strong range of server and storage options, Dell's breadth of options for networking and switching is more limited.

Fujitsu

Fujitsu has a long history in integrated systems in its core Central European and Japanese markets, and some measured success in the U.K., Spain, Italy and Finland. It is less established in the Americas and across the rest of Europe and Asia. Even with this geographic challenge, Fujitsu is able to develop and differentiate, as well as to partner with other technology, software and solution vendors. This broad partnering capability, while being a core strength for solutions, also creates the impression of a fragmented portfolio that hedges all bets, rather than delivering infrastructure focus. This is highlighted by the fragmented management tooling across Fujitsu's offerings.Fujitsu's efforts and delivery models fall into three main categories:

Historical: These offerings focus around FlexFrame and PAN Manager. The FlexFrame Orchestrator for SAP is a coupling of integrated infrastructure, server storage and network, as well as an SAP workload and Oracle DBMS. FlexFrame was a visionary integrated stack built on integrated infrastructure and a proven, complete ERP solution supporting Oracle and SAP components. Now, FlexFrame has been overcome in the market by more competitive mainstream IIS and ISS offerings, and indeed Fujitsu's own broadening of reference architectures. The Fujitsu PAN Manager for Primergy is a niche offering built on Fujitsu's long-established relationship with Egenera. It offers a technically interesting capability to manage and control blades, and interconnects to storage.

Appliances: Fujitsu sells multiple appliances that address specific workloads, including Cluster-in-a-box, SQL Server Data Warehouse Appliance and Check Point Integrated Appliance. Further announcements are planned later in 2014. While these are strong offerings, the volume of these systems is low, in keeping with the entire Fujitsu Integrated System portfolio. However, the value and fit for each system suit the local core market needs for Fujitsu.

Reference Architectures: Fujitsu has several reference architectures, including DynamicFabric, RapidStructure SharePoint and vShape. These are aligned to the individual offerings integrated by Fujitsu, but beyond the scope of this integrated system assessment.

Strengths
  • Fujitsu sells a broad combination of integrated systems, including appliances and reference architectures.
  • The vendor demonstrated a good commitment to local core markets — predominantly German-speaking countries, Western Europe and Japan.
  • Fujitsu integrated systems are well-engineered and proven — some over many years.
Cautions
  • To date, Fujitsu has achieved limited success penetrating global markets outside its core markets, especially in North America.
  • Lack of a consistent brand image makes the Fujitsu portfolio appear complex and harder to differentiate.
  • As a company, Fujitsu exhibits a strong product engineering ethos, with limited product marketing flair.

Hitachi Data Systems

Hitachi Data Systems is the unit within the greater Hitachi organization that is taking a new and more aggressive approach to the system market. The parent company is best-known for systems, software and services, particularly those customized for transportation, energy, construction, manufacturing and medical systems, and mostly in Japan. The new major thrust is toward fully verticalized offerings across all industries, versus discrete products, including the management infrastructure for an integrated system solution. Hitachi has not been known as a major software vendor globally, but it has developed infrastructure software as part of its integrated system effort under the branding of Unified Compute Platform (UCP) since 2010. Hitachi is now in the midst of tying together its hardware, software and services into a unified strategy under UCP. The initiative includes a new marketing campaign, with more consistent branding, aimed at higher-end core, mission-critical applications within enterprise accounts.

Hitachi delivers preconfigured and integrated systems with UCP Director automation and orchestration software tightly integrated to VMware (and other hypervisors) as a single support model. Hitachi also offers preconfigured models that include its own servers and storage, with the addition of reference architectures of alternate servers, such as Cisco (with Hitachi storage). Hitachi is able to deliver the software stacks of VMware, Microsoft, Citrix, SAP and Oracle under one common toolset; this now extends to SAP Hana as well. UCP Director's scope has been broadened to be integrated with VMware and Microsoft, as well as to introduce support for the Cisco UCS blade technology, with unified supported and validated configurations. SAP Hana integrated platforms have been validated by SAP and delivered in production deployments. Finally, on the hardware front, Hitachi's mainframe experience has been used in its server hardware design. It delivers hardware logical partitions to complement hypervisors and achieve secure multitenancy, symmetric multiprocessing (SMP) blade scaling and failover similar to the isolation, security and transaction failover capabilities of Unix systems, but on x86 infrastructure. Early client inquiries have been positive about the resilience and failover of the UCPs.

Strengths
  • Hitachi is a highly regarded vendor with a strong technology base.
  • The vendor has a reputation for quality.
  • Hitachi is a globally renowned storage vendor, with a broad installed base that can be mined.
  • Hitachi has the financial resources and willingness to expand its geographic presence.
  • The vendor has relationships with Cisco and SAP.
  • Hitachi's blade technology has strong partitioning capabilities that are similar to those of high-end Unix systems.
Cautions
  • Hitachi has enjoyed limited sales success and market awareness in the U.S., as an integrated system vendor.
  • Cisco's growing investment in storage strategies could create rivalries that will weaken the partnership between Hitachi and Cisco.
  • Hitachi has limited direct sales and channel reach, especially outside Japan and other core geographic markets.
  • Partnering with Cisco raises the risk of channel conflict with other Cisco storage vendor alliances (such as Cisco-NetApp and Cisco-EMC).

HP

HP sells a very broad portfolio of integrated systems. While most leverage HP's established blade server technology and 3PAR storage, there are other systems based on rack-optimized technology and new-generation highly-modular technology in the form of Moonshot. HP has been selling integrated systems since 2008, and has no dependencies on third-party vendors to create a complete integrated system experience (although HP's CloudSystem can support third-party switches and storage on-demand). Since launch, the portfolio has steadily widened, and this has created the potential for branding and messaging confusion over which systems are most appropriate for which purposes. Consistent articulation of its message across a broad channel remains HP's greatest challenge. This creates frequent positioning problems both for the emerging market for integrated systems and for the highly established market for HP's x86 servers.

HP is in the process of simplifying the branding around one primary classification — ConvergedSystem — with use cases varying from basic workload virtualization to specific embedded workloads, such as Microsoft Exchange, SAP Hana and Citrix Virtual Desktop Infrastructure (VDI). To date, HP's most recognized integrated system brand (with over 1,100 customers) is HP CloudSystem, and that will be retained, but will be more focused on pure private/hybrid cloud use cases. Templates that optimize deployment for specific workloads have been universally named Cloud Maps for the HP CloudSystem; HP is extending this concept with the introduction of App Maps for other integrated system designs, to optimize deployment to noncloud environments. HP will use the "Cloud Maps" term only for cloud-related workloads in the future, preferring to use the "App Map" term for all other workload templates.

To address the desire for a single "software-defined infrastructure," HP launched OneView late in 2013. OneView builds on HP's already proven server management tools, with the addition of 3PAR storage. Later in 2014, HP will start to add support for HP networking technology, although this effort will extend into 2015 and beyond.

HP is investing in innovations that are likely to cannibalize some of its products over time. In 2013, HP launched a new class of integrated system called Moonshot, focused on scalable application environments where current IT infrastructure is not sustainable in terms of space, energy and cost. This is a true fabric-based computer that currently supports up to 180 servers in a 4 rack unit (U) chassis. Initial designs were based on Intel Atom, but HP has recently launched the ConvergedSystem 100. This Moonshot-based design uses a new APU processor from AMD that combines CPU and graphics processing unit (GPU) capabilities, and is targeted at Citrix VDI or hosted desktop infrastructure (HDI) deployments that require the power of a full desktop, including multiple applications and business graphics. Further Moonshot support for ARM processors and various specialty engines for graphics, security, etc., are all in development. While Moonshot competes with multinode servers that are usually aimed at extreme scale-out workloads, it is a valid integrated system due to the internal switched fabric and integrated storage. At the other end of the workload scale, HP's ConvergedSystem 900 for SAP Hana is a brand new system that was launched at SAP's Sapphire conference this year. HP already has over 800 SAP Hana installations across a range of AppSystem-branded configurations, but this new system will address the most challenging instances of SAP Hana deployment, with up to 16 processors and 12TB of memory in each node. More generic instances of the same system will be launched to support more generalized consolidation and Unix migration instances.

Strengths
  • The vendor's x86 blade and rack market leadership, plus a large enterprise virtual array (EVA) storage installed base, provide a strong foundation to upsell.
  • HP has respected and widely deployed management tools, with the potential for OneView to expand that reputation still further as the product matures.
  • The vendor has a leading market presence in the burgeoning SAP Hana market.
  • HP offers a very broad portfolio of integrated systems that address multiple use cases.
  • HP has the ability to leverage strong and proven relationships with SAP, VMware, Microsoft, Citrix and other key independent software vendors (ISVs).
Cautions
  • HP's breadth of portfolio and inconsistent branding create frequent messaging confusion.
  • Conversations with Gartner clients indicate periodic dissatisfaction with support quality and the degree of vendor commitment/consistency.
  • Gartner observes periodic field execution weaknesses, which tend to be localized to certain geographies.
  • The conversion rate of regular blade-based servers to integrated systems has been slow, given the opportunity presented by the size of the installed base.
  • An occasional lack of assertion still provides competitors with market penetration opportunities into established HP accounts.

Huawei

Huawei started its enterprise business in 2011, creating a challenge for the vendor to transform from its service provider focus into a balanced provider, catering to global, enterprise and consumer markets. During the past two years, Huawei has shown great ambition and technology vision to break into mature markets. However, because of concerns over national security from some governments, it has encountered major obstacles, predominantly in North America's national infrastructure projects. In the near future, emerging markets, the Asia/Pacific region and Western Europe will continue to be the strategic focus for Huawei's data center business. Huawei's FusionCube is based on the E9000 blade platform, integrated with distributed (scale-out) storage. When augmented by FusionSphere and FusionAccess, this creates a good mix of physical, virtual and private cloud hardware and software combinations, with strength in its integrated capabilities, especially for DBMS and similar workloads. An up-and-coming product in emerging markets, Huawei FusionCube boasts references across the Asia/Pacific region (predominantly China), EMEA and other emerging markets. However, it requires more global customer references.

FusionCube targets telecom customers and enterprise customers who need DBMS and/or cloud infrastructure that has high input/output (I/O) performance: one-stop cloud infrastructure and database/data warehouse platform. For telecom customers, Huawei's strategy is to leverage existing network infrastructure customer relationships and focus on the telecom's internal cloud built-up projects and public cloud built-up projects. For enterprise customers, Huawei focuses on named accounts in six vertical industries and does not do mass marketing to all potential customers.

FusionCube's channels are mainly the high-impact ISVs in vertical industries. Huawei deploys FusionCube as the foundation for ISVs in vertical industries to integrate their products with Huawei's own solutions. Huawei and ISVs will co-market and promote the solution in vertical industries. There is now ISV support from SUSE, Red Hat and SAP for FusionCube, and more recently from Microsoft, Oracle and VMware. Huawei plans to put FusionCube in existing distribution channels to mass market when converged infrastructure becomes more broadly adopted. FusionCube is appropriate for Huawei software users. Users of other x86 servers and solutions should validate the level of third-party software certification and local support.

Strengths
  • Huawei markets the FusionCube integrated solution with scale-out storage — alongside FusionSphere and FusionAccess.
  • The vendor invests in tight integration for specific verticals, channel and ISVs — especially for DBMS and private cloud infrastructure.
  • Emerging markets like Brazil, Russia, India and China provide Huawei with opportunities for international expansion.
  • Huawei's huge addressable market and IT product portfolio create opportunities for cross-pollination from other disruptive technology markets, such as network infrastructure.
Cautions
  • Huawei's global presence tends to be highly polarized due to the delicate situation regarding IT security between many Western nations and China; this reduces willingness to invest in a number of countries.
  • There are Microsoft, VMware, Oracle, ISV and third-party software issues around support and certification.
  • Huawei has been challenged to integrate its infrastructure and solutions with many popular third-party technologies commonly deployed in this market.

IBM

When the PureSystems brand of integrated systems was launched in April 2012, IBM was perceived to be slow in responding to market demand after HP's original launch of its integrated system strategy in 2008, and Cisco's and VCE's entries in 2010. With its large installed base of hardware and software solutions and a large global reseller presence, IBM took the next two years to organize and hone its sales effort to increase demand generation from the benefits of its PureSystems preintegrated, managed and supported compute-network-storage solutions, and to persuade IT leaders of its superior breadth and depth. The ramp-up of adoption, as indicated by Gartner client inquiry interest, has been slow, but gradually improving toward greater acceptance in 2013. One reason, as expressed by users, has been the complexity of product vision across brands. To market hardware and software solutions of its own and third-party ISV solutions, IBM created several sub-brands: (1) PureFlex (integrated x86 and Power system hardware); (2) PureApplication (application and middleware software deployment agility and performance); (3) PureData (database management and big data analytics); and (4) Flex Systems (channel and IT customized system integration of x86 and Power). As part of PureApplication, solutions were offered for cloud (SmartCloud Entry), big data and Hadoop, application and process optimization (Expert Integrated Systems) and mobile applications (Mobile Application Platform Pattern for PureApplication). In addition, IBM sought to integrate, consolidate and manage its platform diversity via Flex System Manager for Power/AIX, and IBM System i and System x server (BladeCenter) technologies under the PureSystems brand. We found users initially impressed with the technical integration and performance, but they were also confused by IBM's positioning. For example, IT organizations were dealing with a PureSystems sales team in addition to their traditional x86 and Power server sales teams, which were not always synchronized to optimize the users' benefits. Concurrently, the portfolio of both nonintegrated and integrated systems expanded with differing Power and x86 configuration options.

PureSystems momentum built steadily throughout 2013 as the vendor added reference architecture validations for SAP Hana, Microsoft Hyper-V and KVM solutions to its VMware deliverables. However, Gartner research and client inquiries indicate that most sales have been hardware-focused solutions of PureFlex and Flex Systems as a convenient account entree. IBM has been building channel interest and expertise for PureApplication's value proposition. ISV solution providers are especially strong in the financial, healthcare, energy and retail industries. The vendor has also been training and certifying integration partners and ISVs on a broad and global landscape. Nevertheless, Gartner experiences fewer inquiries on these systems and they still represent a relatively small proportion of total PureSystems sales.

In January 2014, IBM announced that Lenovo will acquire IBM's x86 server business. While the announcement occurred after the research for this Magic Quadrant was underway, the event nevertheless bears on the Magic Quadrant vendor evaluation. This sale, which is expected to close later in 2014, will result in Lenovo supplying the underlying x86 server technologies for PureFlex and Flex Systems. IBM resources will be leveraged by Lenovo to maintain and provide services (from 7,500 IBM employees going to Lenovo), while IBM will retain exclusive ownership, development and sales of PureApplication and PureData. All x86 server components in the Pure brands will be supplied by Lenovo, who will also compete as an integrated systems supplier under the PureFlex and Flex Systems labels. The relevance to users will be in the coordination by the two companies at several levels: maintenance, technical support, consulting services and, most importantly, road map and product directions. Their tight alignment on life cycle management and upgrades will be essential in continuing the forward momentum established by IBM. IBM must reduce perceived IT concerns that Gartner is detecting among clients, while accelerating its momentum with PureSystems.

In addition to its software enablement strategy under PureApplication and PureData, IBM must accelerate adoption of Flex System Manager as a fabric resource pool manager to compete with other fabric resource pool managers (FRPMs). Flex System Manager is part of PureFlex, PureApp and PureData, but is optional on Flex Systems, with a build-it-yourself strategy. IBM's PureSystems revenue without the x86 compute components will be more dependent on software, service and cloud-generated revenue, with a shrinking contribution from hardware.

Strengths
  • IBM has a broad portfolio of chassis and blade options with strong blade market share.
  • The vendor has a strong software and service portfolio.
  • IBM has a leading market presence in the rapidly growing SAP Hana market.
  • PureApplication is a good platform for IBM to leverage its proven strengths in middleware, application and cloud performance optimization.
  • IBM's integrated systems offer a broad portfolio across applications and infrastructures.
  • There is consolidation and integration among some IBM technology silos.
  • There is broad ISV/reseller support of PureApplication and PureData.
Cautions
  • Buyers need to assess the potential impact of the Lenovo acquisition on the PureFlex and Flex Systems road maps.
  • Gartner inquiries reflect client concerns regarding future hardware portfolio rationalization.
  • Inquiries also show unease regarding IBM's long-term stability and continuity.
  • There is a perceived shifting focus by IBM marketing to Power Systems and System z as the homegrown innovation engines of growth.

Nutanix

Nutanix is a privately funded vendor of new-generation technology that started shipping products in 2011. The vendor is venture-funded, and has raised $173 million in funding so far. The Nutanix NX family offers four different models of highly integrated systems, which address enterprise and branch general-purpose needs, plus systems that are optimized for big data or graphics-intensive workloads. So far, over 5,200 units have been delivered in more than 30 countries, of which 95% are deployed in production environments. As is to be expected, about three-quarters of shipments favor North America, with about 15% going to EMEA and 10% elsewhere.

Nutanix works through channel partners to implement new systems, particularly in those countries outside North America. But regardless of final destination, systems are always factory-built and integrated. Nutanix has recruited 750 partners so far, including several major international distributors. The Nutanix technology differs architecturally from most other vendors, in that the storage and compute elements are natively converged to create a much tighter level of integration. This node-based approach enables theoretically limitless additions of new compute or storage bandwidth in very small increments. Nutanix has patented this distributed software architecture that is used to add resource at a very granular level, with rapid provisioning of new hardware and orchestration with required workloads. Although based on a switched topology, Nutanix is vendor-agnostic and supports Ethernet switches from multiple vendors.

Nutanix has close working relationships with multiple top software vendors, and workloads like VDI, Hadoop and DBMS servers are well-represented among the installed base. Maximum neutrality is a major focus for Nutanix, as it works to build trust across a wide variety of vendors. The vendor frequently targets specific workload needs to penetrate new accounts, and then expands the workload reach to compete with incumbent vendors as client confidence is built. Nutanix claims that 50% of first-time clients expand their configurations within six months (and 70% do so within 12 months).

Strengths
  • Nutanix has a highly innovative and scalable architecture that is generationally advanced compared with most rivals.
  • The vendor's highly modular designs allow the easy addition of new server and storage resources.
  • The Nutanix technology is certified to support a wide range of virtualization, operating system and software stack options.
  • Nutanix has an impressive reference client list across many vertical industries and geographies.
  • The vendor gets very positive client feedback.
Cautions
  • Nutanix is a venture-funded startup with a relatively short presence in the market.
  • International clients should validate the presales and postsales capabilities of local channel partners, and insist on talking with reference clients in their region.
  • The tight integration of compute and storage makes it particularly important for users to create collaboration between different administration teams.

Oracle

Oracle has taken a different approach to the integrated system market, by focusing on Oracle software workloads as the dominant use case. Most vendor strategies concentrate on hardware-level integration, creating generic systems that can run many workloads. ISS vendors, however, take this integration to the next level by integrating one or more software layers — aiming to provide more value to customers who choose to deploy them. With the exception of the recently launched Oracle Virtual Compute Appliance, Oracle's Engineered System strategy is targeted at a range of Oracle workloads. Oracle Exadata Database Machine has been — by far — the most successful product to date, and is aimed at both online transaction processing (OLTP) and data warehousing DBMS workloads. But other products, such as Oracle Exalogic (aimed at the market for Fusion-based Web and application serving workloads), Oracle Big Data Appliance and Oracle Database Appliance, are gradually penetrating their respective stack-specific markets.

Oracle also differs from its peers by focusing on rack-optimized server nodes, plus numerous technology innovations, such as integrated flash memory, a strong InfiniBand switch topology and hybrid columnar compression, that help to optimize application performance. In Gartner client inquiries, the great majority of users are very satisfied with the performance and functionality of their Oracle software workloads running on Oracle Engineered Systems. While the great majority of integrated systems that the vendor ships are based on Intel x86 and Oracle's own Linux distribution, the SPARC-based SuperCluster is also branded as an Engineered System, and ships with the Oracle Exadata Database Machine storage engine that enables strong DBMS performance in a RISC-based design.

By tightly integrating the software stack, Oracle's integrated systems create additional challenges for some data centers. All integrated systems are capable of creating tensions between different administrators — server, storage, networking, virtualization, etc. Pricing policy becomes similarly challenged, as it can become more difficult to do an "apples to apples" pricing comparison with other integrated systems that run on an Oracle software stack. So, by embedding the software stack, Oracle's products demand the close participation of the lines of business, as well as procurement specialists, in the buying decision.

With only a small minority of the total Oracle software community addressed to date by Oracle's integrated systems, there is plenty of scope for Oracle to sell more systems. Ongoing surveys among Gartner clients indicate that most users still favor the generic hardware approach, so Oracle (and other vendors of integrated stack systems) must overcome fears of placing too much trust in and dependency on any one vendor. But the vendor has achieved clear market leadership for the use cases where users are willing to invest in an appliancelike solution that delivers very good workload performance, while greatly simplifying the task of workload integration and management — even when that comes with the potential for increased vendor lock-in.

Strengths
  • Oracle offers a strong (and growing) portfolio of integrated systems.
  • There are proven performance benefits for Oracle software workloads
  • The vendor has close alignment of its software and hardware strategies.
  • Oracle has an opportunity to cross-sell and upsell into its installed base.
  • The vendor has aggressive marketing and product strategies.
  • Oracle enables application owners to become an effective buying center and point of administration for its Engineered Systems.
Cautions
  • Gartner client inquiries demonstrate a fear of a greater degree of vendor lock-in when integrated systems extend to include the software stack.
  • Oracle's Engineered Systems are perceived as relatively expensive.
  • There is a greater risk of conflict if line-of-business administrator roles are not synchronized with the aims of the data center administrators.
  • Potential customers need to validate references and use cases for Engineered Systems other than Oracle Exadata Database Machine, as shipments to date are heavily skewed toward the latter.

SimpliVity

SimpliVity is a privately funded vendor of new-generation technology that started shipping products in 2013. The vendor is venture-funded, and has raised $101 million in funding so far. SimpliVity's value proposition consists of a highly innovative data virtualization platform that abstracts data from its underlying hardware to provide greater data mobility, operational efficiency and total cost of ownership reduction, while eliminating the risk and expense associated with the traditional technology refresh life cycle. The vendor's software platform is designed to run on any x86-based server; however, for the purposes of this Magic Quadrant, we have assessed SimpliVity based on its OmniCube hardware solution, a modular, server/storage complex based on x86 hardware and VMware hypervisor technology. SimpliVity's aim is to prove that OmniCube is the best platform for running vSphere, plus other virtualized workloads upon which core data center applications run, including Hyper-V and KVM in the future. But in the short term, users of other virtualization technology must validate this potential. SimpliVity claims that over 350 systems have shipped, and further claims that 80% are already in full production.

As well as integrating server, storage and network switch technology — a common trait of all integrated systems — OmniCube goes further by incorporating capabilities such as global namespace for centralized management of geographically distributed storage, built-in VM backup, and global in-line data deduplication, compression and optimization at the source. By reducing input/output operations per second (IOPS) — given that only unique writes generate IOPS — SimpliVity aims to reduce required storage capacity (primary, backup and archive data) and WAN traffic. It is also possible to run an instance of the software on Amazon Web Services (AWS) as a low-cost target for backup/restore.

OmniCube modules come in three different capacities, ranging from an 8-core, 5TB module to a 24-core, 30TB module at the high end. These 2U modules can, in theory, be stacked in an infinite number to create what SimpliVity calls a federation. This allows the user to add resources very incrementally, with the additional proviso that modules can be deployed across multiple locations to aid business continuity. SimpliVity also enables customers to connect third-party servers running VMs to the OmniCube systems for added flexibility and generational interoperability. SimpliVity's partner network now exceeds 150 partners in over 15 countries, with over 60% of sales in North America and about 30% in EMEA, plus emerging sales via key partners in other regions.

Strengths
  • OmniCube has a highly innovative design that incorporates in-line deduplication and data compression at origin, as well as global namespace and native VM backup.
  • The modularity of OmniCube theoretically enables very high scaling in small server/storage increments.
  • Wide-area support facilitates business continuity strategies, as well as unified management of remote sites.
  • Simplivity's management tools connect to existing management frameworks via vCenter/Openstack standard APIs.
  • Gartner client inquiries demonstrate very positive client feedback.
Cautions
  • SimpliVity is a nascent vendor that is dependent on venture funding.
  • International clients should validate the presales and postsales capabilities of local channel partners, and insist on talking with reference clients in the region (especially clients outside EMEA and North America).
  • The tight integration of compute and storage makes it particularly important for users to create collaboration between different administration teams.
  • As shipments of OmniCube only started in early 2013, the installed base is still very small, with relatively few reference accounts.

Teradata

Teradata is a leader in the enterprise data warehouse (EDW) market. However, for this Magic Quadrant, we are assessing only the integrated infrastructure capabilities of the Teradata platforms, not the integrated stack components, such as the Teradata Database and other business intelligence/data warehouse analytics software. The Teradata solution is based on x86-based technology primarily running SUSE Linux, although its installed base has a legacy Unix MP/RAS version that is gradually declining as the installed base converts to Linux. Teradata systems use an MPP topology (using virtual AMPS) with small two-way nodes connected via a high-performance, proprietary fiber switch called a Bynet. Although Teradata's solution traditionally was more expensive than its competitors' solutions, the price has been reduced, and it does offer the ability to mix new generations of hardware with older generations, thus protecting the customer's investment.

Teradata has always sold workload-specific platforms, and the range has expanded gradually to fit many data warehousing, data discovery and data staging needs. The common Teradata DBMS is deployed across the Active Enterprise Data Warehouse, the Data Warehouse Appliance, the Data Mart Appliance and the Extreme Data Appliance. For multistructured data discovery and data staging, Teradata has launched the Teradata Aster Big Analytics Appliance and Teradata Appliance for Hadoop. Because Teradata controls the stack, each platform is shipped ready to run a distinct workload.

Strengths
  • Teradata offers a portfolio of proven integrated systems, which started as an EDW solution, but is now joined by a growing range of stacks for analytics.
  • Teradata's solutions are built on value-added software and switch capabilities on other commodity components.
  • The vendor has a very loyal installed base and community.
  • Strong sales and service are associated with Teradata's stack and infrastructure.
Cautions
  • Teradata is still perceived as primarily a high-end solution and regarded as relatively expensive.
  • Teradata addresses only the markets for EDW/analytics, and has limited focus on opportunities for transactional workloads.
  • Teradata users are being offered more choices and alternate architectures or solutions through the introduction of competitive in-memory databases and disk caching technologies.
  • Open-source software (OSS) alternatives are raising the bar and diluting the market for specialist workload vendors.

Unisys

Unisys has had a long heritage in the mainframe market with ClearPath systems and services. While some would consider the mainframe as the ultimate integrated system, its proprietary software, hardware, application-specific integrated circuits (ASICs) and fabric result in a market disadvantage to the latest generation of integrated and converged fabric-based systems based on lower-cost compute, virtualization, storage, management software and applications. On the other hand, these mainframes were originally built to run the most mission-critical applications and are security-hardened to near invulnerability. Unisys is building on its mainframe credentials to participate in the broader integrated system blade market.

The vendor is leveraging foundational architectural attributes from its strong mainframe heritage, and reconstituting the design into a modular, open approach while retaining mainframe attributes. The strategy is called Forward, and its launch and go-to-market activity is in the earliest stages. Unisys brings its experience in airline reservations, banking, emergency service and government systems to a broader audience, who may not previously have been amenable to x86 servers running Linux and Windows for mission-critical applications. Forward is architected to enable multitenant partitions or standard virtualization, with mainframe- and Unix-level robustness, high-speed fabric interconnect, advanced grade security, and scale-up symmetric multiprocessing, as well as scale-out Hadoop processing with automation and orchestration management software.

With only barely a calendar year quarter of experience in shipping its re-engineered new systems, Unisys has little track record to prove its credibility in this nascent market. The early interest will be from existing mainframe users, those seeking rugged and reliable systems, and Unix shops exploring migration opportunities. Unisys's top-down core applications appeal will likely complement the bottom-up interest that IT shops with large stakes in x86 servers through e-commerce, mobility and modernized business applications represent. It's potentially possible that Unisys could talk to the same IT shop from a different perspective, even if the shop has integrated systems from other vendors. Unisys intends to broaden integrated systems to include integrated workload systems and more tightly integrated systems with existing storage partners (such as EMC and NetApp) this calendar year.

Strengths
  • Unisys is able to leverage attributes more commonly associated with high mainframe security, isolation and reliability.
  • Unisys has experience in application and industry sectors with stringent SLA requirements.
  • The Unisys isolated partition capability segregates users, data and applications to ensure compliance, but still enables users to benefit from consolidation.
  • Combined scale-up and scale-out can be achieved in a single consolidated system.
Cautions
  • The vendor lacks an experienced and verifiable installed base.
  • The Unisys ISV support program is at an early stage of certification.
  • With a young product, Unisys still has unproven automation and orchestration.
  • There is a lack of user data regarding time to build, deliver and productize.

VCE

VCE, a private company, was initially formed in 2009 by Cisco, EMC and VMware, and began shipping Vblock systems in 3Q10. The vendor has dispelled many of the earlier market doubts, and revenue in 2013 is now estimated to extend beyond $1 billion. The vendor's momentum is due, in large part, to growing adoption in large global organizations and among large service providers, reinforced by strong partners in Cisco and EMC that helped VCE compete against formidable competition. Its integrated best-of-breed components (i.e., Cisco UCS server blades and networking, and EMC storage combined with VMware virtualization) have been a major contributing factor to VCE's success. VCE has also applied its own engineering resources to create an integrated compatibility and test matrix to the patch and upgrade process in a single-source cooperative support agreement, including validated certification with its partners. The vendor continues to broaden its market opportunities by expanding ISV relationships, Specialized Systems (specifically optimized and tuned such as SAP Hana, VDI, Oracle DBMS), low-entry-priced configurations for remote and distributed sites, and its VCE Vision Intelligent Operations life cycle management software.

We do not believe that the alliance of VMware, EMC and Cisco is at imminent risk; however, as in any alliance, fragmentation can always occur. For example, VSPEX is an EMC channel partner program designed to promote integrated system reference architectures, EMC storage and other server blades in addition to Cisco's as solutions by third parties that can compete; Cisco is implementing storage-attached configurations from its recent acquisition of Whiptail; Cisco offers the FlexPod solution with NetApp storage that competes against EMC and is not part of the VCE reference build; and Cisco has an early relationship with Hitachi that will grow to compete. The cloud strategies of VMware and Cisco potentially create confusion for VCE adopters (such as VMware vCloud and Cisco Intelligent Automation for Cloud). VCE is positioning itself to offer the APIs for alternative higher stacks, but does not subsume these capabilities in VCE Vision Intelligent Operations.

VCE will integrate with and support Cisco's Application Centric Infrastructure (ACI) software-defined networking. VCE will not integrate VMware's software-defined networking solution, NSX, but NSX can run on Vblock with support from VMware. And, of course, there are IT preferences for component flexibility that will apply pressure on VCE to make judgments on implementing greater component flexibility and inclusiveness at the trade-off between greater complexity and engineering costs.

Strengths
  • VCE has had proven success across major global enterprises in banking, retail, healthcare and manufacturing.
  • It has a single-source cooperative support model with Cisco, EMC and VMware.
  • VCE Vision Intelligent Operations management complements Cisco UCS and VMware management.
  • Close alignment to EMC enables new business opportunities from EMC-led storage clients.
  • VCE benefits from Cisco's and VMware's broadly deployed incumbent footprints.
Cautions
  • There are potential conflicts among the partners' competitive interests.
  • Competition exists from channel programs and reference architectures (such as Cisco-NetApp FlexPod and EMC VSPEX).
  • Users who favor the more holistic single-vendor solution from vendors like Oracle, IBM and HP will be more likely to question a partner-dependent business model.
  • VCE is in the early phases of channel and geographic expansion.

Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as markets change. As a result of these adjustments, the mix of vendors in any Magic Quadrant or MarketScope may change over time. A vendor's appearance in a Magic Quadrant or MarketScope one year and not the next does not necessarily indicate that we have changed our opinion of that vendor. It may be a reflection of a change in the market and, therefore, changed evaluation criteria, or of a change of focus by that vendor.

Added

None; this Magic Quadrant is in its first release.

Dropped

None; this Magic Quadrant is in its first release.

Inclusion and Exclusion Criteria

There are many variations of integrated systems available, many of which are impossible to assess fairly and equally using the methodology of a Magic Quadrant. Many vendors are able to deliver an integrated system "experience," but through loose collaboration that creates a form of reference architecture or certified design. Bull, for instance, works with EMC, NetApp and IBM to create various integrated system designs; however, the solution failed the criteria for inclusion in this research.

We have defined the following eligibility criteria for inclusion in this Magic Quadrant:

  • Integrated systems must have servers, storage, network and a management software layer associated with them. Software-only integrated systems do not qualify at this time, as the customer or the integrator would have to layer the software on top of third-party hardware, and integrate and support the offering.
  • Integrated systems that fall into both the integrated infrastructure/stack and reference architecture categories are eligible, if they meet other required inclusion criteria. Each integrated system that leverages a reference architecture is assessed for inclusion based on its individual merits. Only reference architectures that are mutually inclusive between the partners would be eligible.
  • Reference architectures are a good way for two vendors to partner so that each other's weaknesses can be addressed to create an integrated system experience. However, if those reference architectures are expanded to multiple vendors, then those weaknesses are not consistent between all the partnerships, and the technology is not eligible for this Magic Quadrant.
  • An eligible integrated system must be based on an agreed-on short menu of server, storage and network elements; this could be as low as one per element (in fact, one is preferred), and would never be greater than a handful of options. End-user clients must be able to select based on a strong degree of predictability.
  • While an integrated system must have compute, storage, network and management functionality on board, we recognize that many — even most — offerings will involve a degree of vendor collaboration. Some vendors will also not have an integrated networking switch in hardware, but will deliver some or all of the functionality in the virtualization software layer.
  • If the end user has to do the integration, the technology is not an integrated system that is valid for inclusion; however, it may be an eligible reference architecture that delivers an integrated system experience. This, again, eliminates software-only solutions, because the customers have to configure their own hardware. The value proposition of an integrated system should remove the need for racking and stacking from the customers' hands.
  • A system that ships with included just a bunch of disks (JBOD) storage will not be an eligible integrated system, unless the vendor delivers integrated management capabilities for the storage and related processes (such as backup and recovery of workloads).
  • The support aspect is considered crucial. We believe that support Level 1 (call center/service desk) and Level 2 (escalation) must be integrated to facilitate quick and easy problem resolution. However, Level 3 (engineering) support can still be delivered separately for the individual components of integrated systems based on vendor partnerships.
  • Finally, we stipulate proven vendor collaboration regarding engineering, laboratory coordination, certifications, qualifications, testing, etc.

Evaluation Criteria

Ability to Execute

The market for integrated systems is complex, with greater dependency on very specific topics. We have, therefore, added several subcriteria to the standard list of criteria, to enable more accurate vendor assessment. For our assessment of Product/Service, we examine the degree of software integration available from the vendor or implementation partners, plus the vendor's ability to deliver on road map promises. Sales Execution/Pricing examines both direct and indirect execution, as most integration system strategies are highly dependent on the role of local channel partners.

Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria

Weighting

Product/Service

High

Overall Viability

High

Sales Execution/Pricing

Medium

Market Responsiveness/Record

Medium

Marketing Execution

Medium

Customer Experience

Medium

Operations

Low

Source: Gartner (June 2014)

Completeness of Vision

The market for integrated systems is complex, with greater dependency on very specific topics. We have, therefore, added several subcriteria to the standard list of criteria, to enable more accurate vendor assessment. As with Sales Execution/Pricing, the Sales Strategy criterion for Completeness of Vision assesses both the direct strategy and the channel partner strategy. Offering (Product) Strategy focuses on the breadth of the total solution (including software integration), the investment in management tools and the technology portfolio breadth. Business Model examines the implementation services that are available through the vendor or channel partners, and the variety of solutions and use cases that can be addressed.

Table 2. Completeness of Vision Evaluation Criteria

Evaluation Criteria

Weighting

Market Understanding

High

Marketing Strategy

Low

Sales Strategy

Low

Offering (Product) Strategy

Medium

Business Model

Medium

Vertical/Industry Strategy

Low

Innovation

High

Geographic Strategy

Low

Source: Gartner (June 2014)

Quadrant Descriptions

Leaders

Although the storage, compute and network technologies that comprise each vendor's integrated system are typically well-proven products in their own right, the integration of these technologies is a young market. As a result, the market is ripe for future evolution (and the potential emergence of new Leaders). Multiple Gartner client inquiries and surveys demonstrate that Cisco-based derivatives are the most prevalent technologies being shortlisted, and VCE takes the stronger position based on the active promotion of the Cisco, VMware and EMC alliance, and the strong factory integration capabilities that help to differentiate the Vblock product. However, the Cisco-NetApp FlexPod solution has also gained much ground recently, helped by the work that both vendors have done to prove FlexPod as a true integrated system, rather than a pure reference architecture. It is easy to overlook Oracle as an integrated system vendor. Its technology is based on rack-optimized servers rather than blades, and (with the exception of the Oracle Virtual Compute Appliance) all Oracle's products are targeted at specific software stacks or highly prescribed use cases.

Challengers

Teradata is the only Challenger, but the vendor is probably the most experienced integrated system vendor in the market. It is easy to overlook Teradata's products, as the "integrated systems" term has only been in use for a few years. But Teradata (and NCR, before Teradata became independent) has been building tightly integrated systems for a generation. Like Oracle, Teradata concentrates on tight software stack integration, and focuses its products only on markets related to data warehousing, business intelligence and analytics.

Visionaries

The integrated system market is founded on innovation, and attracts numerous startups that see the potential to penetrate a data center market normally dominated by the established vendors. Consequently, the Visionaries quadrant has five vendors, which we believe are pushing the boundaries of technology, but have yet to achieve enough market penetration to become Leaders. IBM's PureSystems family is a broad range of products that encompasses multiple processors, operating systems and software stack integration (both from IBM and third parties). HP also has a very broad portfolio of integrated systems, with the greatest innovation delivered by the radical Moonshot design, and the newly introduced ConvergedSystem 900 for SAP Hana. Dell's portfolio is broad, and has been recently boosted by the launch of VRTX (an integrated system well-suited to branch or departmental workloads). Finally, Nutanix and SimpliVity are both recent startups that are still venture-capitalist-owned. Their technologies deliver much greater bonds between compute and storage components, and each vendor focuses on the management software stack as a chief differentiator. Nutanix is more mature and has a much larger portfolio of clients; hence the stronger Visionary quadrant position. But SimpliVity has made great progress during 2013, and offers an even more radical integration story that extends to deduplication and negates the need for WAN optimization.

Niche Players

Hitachi delivers functionality in its designs that is highly differentiated from most peers, and has a strong management suite. Lack of global awareness is the biggest corporate challenge, but we expect Hitachi will build on its storage market recognition to counter this. Fujitsu is often overlooked as an integrated system vendor, again because of relatively low recognition in the North American market. But, like Teradata, Fujitsu has been shipping integrated systems for many years in the form of its FlexFrame appliance for SAP or Oracle workloads. Huawei holds a strong niche presence with its FusionCube offering, which is gaining in market recognition. While most market success will come from emerging geographies and Asia/Pacific region markets, Huawei's technology is highly innovative. Finally, Unisys is a very new entrant to the integrated system market, and only started shipping its Forward product in late 2013. Unisys can make progress by exploiting its strong vertical market recognition and technology expertise.

Context

This research is intended to help select the vendor approach that is most suited to an organization's integrated system needs.

Most traditional system vendors offer some type of preintegrated system comprising a server, a network and storage. Through appropriate planning, configuration analysis and consultation with the vendor, the user is promised delivery of a self-sustaining and supported system that requires little ongoing maintenance and operations management by IT. The value proposition most attractive to these organizations is the offloaded operations management and optimization of all the moving parts that make up the system as a service delivery platform. Many IT leaders intend these systems to be their foundation for cloud services, yet major cloud providers do not use integrated systems. They want to focus on automated management of the resources presented by the system to enable quick and agile responses to enterprise business needs.

Even though many vendors have entered the market, no two have the same equipment, software and services for the variety of solutions and workloads that IT wants to deliver. Therefore, while the integrated approach offers high potential returns, they are not cumulative across vendors. In other words, each vendor integrates within its own silo of technologies, and integrating across them, as if they were a best-of-breed choice, is a challenge, if possible at all.

Finally, the technology choice should not be taken within the IT organization alone; additional stakeholders need to be part of the decision process around integrated system acquisition. As data center technology becomes increasingly modular, IT organizations, procurement departments, lines of business and asset control departments must reassess life cycle and depreciation planning approaches, as well as purchasing policies, to account for the extended lifespans of integrated systems.

In using this research, IT organizations should take the following recommendations and guidelines into account:

  • Treat integrated systems and converged infrastructure as a data center modernization and transformation project, rather than a refresh or tactical upgrade strategy.
  • Validate whether convergence can be applied usefully toward your goals, infrastructure and experience levels, and include proofs of concept.
  • Plan a differential analysis on converged versus best-of-breed; legacy retention or legacy disposal; human resource retention, transference or reduction; and capital expenditure/operating expenditure (capex/opex) cost comparisons (including retooling).
  • Decide on the vendors and partners, as appropriate, through a detailed requirements checklist, maintenance support matrix, capacity planning and operational impact assessment.
  • Ask vendors to provide road maps equal to the life expectancy of the most durable integrated system components, and a "road map of road maps" for the entire asset.
  • Don't invest in any modular infrastructure without a clear view of which technologies can and can't be upgraded during their operational lifetime, and calculate capacity planning accordingly.
  • Restructure asset depreciation cycles to reflect the extended life span of integrated system assets.
  • Prepare to overhaul software licensing rules, discount calculations and ROI expectations for integrated systems- especially those that have embedded software stacks.

Market Overview

Based on 2013 revenue rates, we estimate the overall market for integrated systems will exceed $6 billion in 2014, with a growth rate of 50% over the prior year. This still represents a low percentage of the $80 billion total hardware market, but its continual growth rates will pose a challenge to the vendors to maximize share of wallet and margins with a compelling value proposition going forward in the future. The forces for acceleration are generally overcoming the inhibitors in discussions with IT decision makers. Among the drivers are:

  • Improved performance
  • Perceived lower operating expenditure costs and greater IT optimization
  • Increased automation
  • Simplified sourcing and support
  • Faster time to value with infrastructure
  • Support in moving from IT maintenance to IT innovation

Opposing forces are perceived premium pricing, desire to self-integrate using internal skills, greater perceived choice and less vendor lock-in. Integrated systems can satisfy user requirements in several different ways by addressing:

  • Integrated applications — around workload optimization and performance
  • Integrated infrastructure — for increased operational efficiencies, automation, simplified sourcing and support
  • Integrated reference architectures — using channel partners specific to industry and application needs, with the option of mixed vendor hardware components delivering a similar value proposition, as detailed above.

Evaluation Criteria Definitions

Ability to Execute

Product/Service: Core goods and services offered by the vendor for the defined market. This includes current product/service capabilities, quality, feature sets, skills and so on, whether offered natively or through OEM agreements/partnerships as defined in the market definition and detailed in the subcriteria.

Overall Viability: Viability includes an assessment of the overall organization's financial health, the financial and practical success of the business unit, and the likelihood that the individual business unit will continue investing in the product, will continue offering the product and will advance the state of the art within the organization's portfolio of products.

Sales Execution/Pricing: The vendor's capabilities in all presales activities and the structure that supports them. This includes deal management, pricing and negotiation, presales support, and the overall effectiveness of the sales channel.

Market Responsiveness/Record: Ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the vendor's history of responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the organization's message to influence the market, promote the brand and business, increase awareness of the products, and establish a positive identification with the product/brand and organization in the minds of buyers. This "mind share" can be driven by a combination of publicity, promotional initiatives, thought leadership, word of mouth and sales activities.

Customer Experience: Relationships, products and services/programs that enable clients to be successful with the products evaluated. Specifically, this includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups, service-level agreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure, including skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.

Completeness of Vision

Market Understanding: Ability of the vendor to understand buyers' wants and needs and to translate those into products and services. Vendors that show the highest degree of vision listen to and understand buyers' wants and needs, and can shape or enhance those with their added vision.

Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout the organization and externalized through the website, advertising, customer programs and positioning statements.

Sales Strategy: The strategy for selling products that uses the appropriate network of direct and indirect sales, marketing, service, and communication affiliates that extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base.

Offering (Product) Strategy: The vendor's approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature sets as they map to current and future requirements.

Business Model: The soundness and logic of the vendor's underlying business proposition.

Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including vertical markets.

Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, defensive or pre-emptive purposes.

Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the "home" or native geography, either directly or through partners, channels and subsidiaries as appropriate for that geography and market.