At the US VMworld 2013 conference, VMware did an excellent job of explaining how network virtualization and storage virtualization were going to work. Adding network virtualization and storage virtualization to the existing virtualization of compute (CPU and memory) along with API’s and policies to manage the whole thing is what creates a software defined data center.

 VMware NSX – The Networking Part of the Software Defined Data Center

VMware presented several detailed sessions on how NSX works. The key point of NSX is that you can define all of the layer 2 – 7 network services that you need, along with add-on services like software load balancers and firewalls, completely in vCenter.

The ability to define these services in vCenter leads to the first disruption that NSX will cause, which is a disruption to the way in which networking services are configured. No, you do not need a Cisco Certified Network Engineer to create a virtual network between two hosts or two guests. Any VMware Administrator with a reasonable background in networking will feel perfectly comfortable setting up these software-based networking services using their favorite administration tool.

VMware also pointed out the NSX runs across all networking hardware, with an emphasis on ALL. This means that NSX does not differentiate between expensive enterprise switches (Cisco), and commodity switches that cost far less. This leads to the second disruption that NSX will inevitably cause. While VMware executives tried to downplay the effect of NSX on vendors of expensive switches (Cisco), the economics are inexorable. As soon as customers determine that commodity switches combined with NSX meet their needs, expect Cisco to have a serious problem.

The ability to use commodity switches with NSX is also a crucial feature for VMware. VMware needs to deliver a hard dollar ROI for the Software Defined Data Center, and letting customers cut the amount of money that they spend on expensive networking hardware is one excellent way to deliver that ROI.

 VMware vSAN – The Storage Part of the Software Defined Data Center

VMware also announced vSAN, its initial entry into the world of storage virtualization. vSAN takes the direct-attached storage inside of servers, pools it, allows you to choose your level of file redundancy, and then presents this pool of storage to the guests as if it were network-attached storage.

VMware took pains to not position vSAN as an alternative to high end storage arrays from hardware vendors like EMC and NetApp. Rather, VMware positioned vSAN as a tier 2 or tier 3 storage offering intended to compliment high-end hardware storage. But then VMware had a demo in its booth of vSAN outperforming an all flash network array of storage for VDI boots and logons. So in spite of protestations to the contrary, VMware has shown that over time it intends to commoditize high-end storage hardware just as it is commoditizing high-end networking hardware.

Again, it is a great thing for VMware to allow customers to replace expensive disks in arrays with cheap disks in servers. Just as is the case with the commoditization of networking discussed above, saving customers money on expensive hardware allows VMware to deliver a hard dollar ROI to its customers.

Summary

In order to sell the Software Defined Data Center, VMware needs to prove that it delivers a hard dollar ROI to the customers of the Software Defined Data Center. Commoditizing the expensive networking hardware business and commoditizing the expensive storage hardware business are two excellent ways for VMware to deliver that hard dollar ROI and to be able to justify its price premium over competitive offerings.

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Bernd Harzog (336 Posts)

Bernd Harzog is the Analyst at The Virtualization Practice for Performance and Capacity Management and IT as a Service (Private Cloud).

Bernd is also the CEO and founder of APM Experts a company that provides strategic marketing services to vendors in the virtualization performance management, and application performance management markets.

Prior to these two companies, Bernd was the CEO of RTO Software, the VP Products at Netuitive, a General Manager at Xcellenet, and Research Director for Systems Software at Gartner Group. Bernd has an MBA in Marketing from the University of Chicago.

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