I brief described in my post Cisco’s data center virtualization strategy: an innovation cycle analysis. how Cisco was trying to implement his data virtualization vision through a platform innovation strategy without hurting his traditional Echo system. Cisco held this strategy until March 2009, when he announced to the world his concept of Unified Computing System.  The first analysis highlighted immediately that with this announcement Cisco was declaring war to Hp and also to IBM.  What happened to push Cisco to this new strategy?

Traditional Blade Architecture vs. Virtualization Architecture.

The first comments identified that reason to enter in the blades business.  With a little bit more time to think, it looked  clear that the blade business couldn’t be so interesting for Cisco to justify the announcement of a war.
Moore, in the 2005, said that “ Cisco organization is optimized for product innovation. Cisco is specifically interested in advanced technologies precisely for their potential for hyper growth adoption (tornado markets).” Even if interesting (especially for HP and IBM), it is very difficult to call the Blades business a tornado market.   So, why Cisco decided to propose his own blade solution? I think that the answer must be found in the original technology idea of Blades. The concept of blades was invented by RLX Technologies but the current architecture of blades has been technologically introduced by IBM and Intel in 2004
The basic concepts of this architecture are:
- the blades servers are the core of the datacenter.
- The networking must be integrated in the blade chassis.
- The management software lies in the blade chassis.
These three concepts are just incompatible with the virtualization vision of Cisco. Is some ways, Cisco was obliged to come out with his own proposal of Blades just because the two giants of Blades wouldn’t (or couldn’t) change their basic architecture.  At the core of the Unified Communication of Cisco there is the Switch and in the switch there is the software management for the whole virtualized structure . Hp itself, when they decided to answer to the attack of Cisco, didn’t concentrate his argumentation on the blades, even if it would be the easier point of attack for them. 

Tornado Market vs Main Street Market

Still to use the terminology of Moore, HP is structured to work in the Main Street Market. Hp is reacting to the attack of Cisco exactly how they did to the introduction of Blades from IBM and Intel some years ago. They are trying to minimize the innovative message of the competitor and exploit their huge based installation to push a much more traditional solution. Using Moore”s words, HP is using a Line Extension strategy and Enhancement Innovation strategy. I believe it is evident to see in practice this strategy in HP’s Matrix.
If you prefer, Cisco is targeting the Tornado Market of the Cloud Computing; Hp is growing by adapting a proven solution to a more specific context (Line Extension Innovation) and earning more margin dollars from existing customers, either by keeping them as loyal customers or by upgrading them to premium offerings (Enhancement Innovation strategy).

What is doing IBM?

What is doing the second blades vendor in the market? Until now the reaction of IBM was for sure defensive (they increase their relationship with Brocade and Nortel) but much more soft that HP. On the other part, Cisco never attacked frontally IBM; on the contrary, Cisco still open speaks about partnership.
I believe that IBM will collaborate with Cisco for at least 3  reasons:
1) IBM shares the same technological vision of Cisco -  a platform innovation strategy – but they have no current (of future) networking base installed to exploit or to protect;
2) IBM has already lost the battle vs HP  to be the leader of the blades server market.
3) IBM is making for sure good money from the blades architecture but it’s making even much more money from services that are not strictly related to the IBM Blades infrastructure (IBM Global Services); among them, there are important services and solutions related to Cisco’s solutions (for example Cisco Unified Communication).
So, I would not be surprise to see – even quite soon - a Cisco UCS 2100 in the IBM Blade Chassis and an integragration between IBM Director and Cisco UCS Manager.

What is the impact of this war for the ICT Channel?To understand the impact of this war in a long term is necessary to look at the more general picture of how the ICT channel will be impact by the Cloud Business. Truly, I am not yet ready to face this subject.
In a short term, if we limit the analysis at the blade market, it is possible to identify some clear tendencies in the Enterprise distribution channel and in the Var and System Integrator Channel.
I will write about these tendencies in my next post.
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To know more:
Is the success of Cisco UCS real?
HP punts turnkey Matrix cloud
IBM Acquires BLADE Network Technologies
Magic Quadrant for Blade Servers (update at 17/01/2011)
What’s behind the surge in HP Matrix customers?
Cisco Announcement Review: Assessing New Switch Functionality in 2011
HP Adds Egenera Blade Management To Battle Cisco
Cisco and cloud computing: Go with the networking giant?
Cisco UCS Networking videos (in HD), Updated & Improved!
Cisco impresses with UCS
Cisco Reaches 10,000 UCS Customers (January 2012)