The details of the acquisition were not disclosed, but we would be surprised if Cisco made back any of the $180m it paid for Composite Software in 2013. Cisco did at least manage to grow the data virtualization business during its ownership. The company told us in September 2016 that it had 250 paying customers for what was then Cisco Data Virtualization (up from 200 at the time of its acquisition of Composite Software). The deal is expected to close in the coming weeks.
As part of CoreOS’s conference this week, 451 put out a sponsored study on container orchestration. It’s been much cited and is free, so it’s worth taking a look. Here’s my highlights and notes:
- Leadgen yourself to CoreOS get a copy of the report.
- This report is really more of a “container orchestration usage” report than much about “hybrid cloud.”
- “We surveyed 201 enterprise IT decision-makers in April and May 2017. This was not a survey of developers; rather, we received responses from those in C-level and director-level positions, including CISO, CTO, CIO, director of IT, IT Ops and DevOps, and VPs and managers of IT.”
- All from the US
- “All of our survey respondents came from organizations using application containers, and all were familiar with their organization’s use of containers.” – This survey, then, tells you what people who’re already using containers are doing, not what the entire market is thinking and planning on.
- “A significant slice of the survey respondents represented large enterprises.”
- Organizations are hoping to use containers for “[a] ‘leapfrog’ effect, whereby containers are viewed as a way to skip adoption of other technologies, was tested, and a majority of respondents think Kubernetes and other container management and orchestration software is sufficient to replace both private clouds and PaaS.”
- Obviously I’m biased, being at Pivotal, but the question here is “to do what?” As we like to say around here, you’re going to end-up with a platform. People need a “platform” on-top of that raw IaaS, and as things like Icito show (not to mention Pivotal’s ongoing momentum), the lower levels aren’t cutting the mustard.
- There’s an ongoing semantic argument about what “PaaS” means to be mindful of, as well: in contexts like these, the term is often taken to mean “that old stuff, before, like 2009.” At the very least, as with Gartner’s PaaS Magic Quadrant, the phrase often means means “only in the public cloud.” Again, the point is: if you’re developing and running software you need an application development, middleware, and services platform. Call it whatever you like, but make sure you have it. It’s highly likely that these “whatever you want to call ‘PaaS’ PaaSes” will run on-top of and with container orchestration layers, for example, as Cloud Foundry does and is doing.
- That said, it’s not uncommon for me to encounter people in organizations who really do have a “just the containers, and maybe some kubernates” mind-set in the planning phase of their cloud-native stuff. Of course, they frequently end-up needing more.
- Back to the survey: keeping in mind that all respondents were already using containers (or at least committed to doing so, I think), ~27% had “initial” production container use, ~25% of respondents had “broad” containers in production. So, if you were being happy-path, you’d say “over half of respondents have containers in production.”
- In a broader survey (where, presumably, not every enterprise was already using containers), of 300+ enterprises, production container use was: 19% in initial production, 8% were in broad production implementation.
- Nonetheless, 451 has been tracking steady, high growth in container usage for the past few years, putting the container market at $2.7B by 2020 and $1.1bn in 2017.
- As the report says, it’s more interesting to see what benefits users actually find once they’re using the technology. Their original desires are often just puppy-love notions after actual usage:
- Interesting note on lock-in: “Given that avoiding vendor lock-in is generally a priority for organizations, it might seem surprising that it was not ranked higher as an advantage since much of the container software used today is open source… However, our respondents for this study were users of containers, and may have assumed that the technology would be open source and, thus, lock-in less of a concern.” (There’s a whole separate report from Gartner on lock-in that I’ll take a look at, and, of course, some 140 character level analysis.)
- On marketshare, rated by usage, not revenue:
- On that note, it’s easy to misread the widely quoted finding of “[n]early three-quarters (71 percent) of respondents indicated they are using Kubernetes” as meaning only Kubernetes. Actually, people are using many of them at once. The report clarifies this: “The fact that almost 75% of organizations reported using Kubernetes while the same group also reported significant use of other container management and orchestration software is evidence of a mixed market.”
As one last piece of context, one of the more recent Gartner surveys for container usage puts usage at around 18%, with 4% of that being “significant production use”:
Of course, looks at more specialized slices of the market find higher usage.
This early in the container market, it’s good to pay close attention to surveys because the sample size will be small, selective, and most people will only have used containers for a short while. But, there’s good stuff in this survey, it’s definitely worth looking at and using.
Simon Sharwood pulls together some shipment numbers to put VR headset shipments in context.
The tl;dr on annual shipments: 9.2m VR headsets, vs. 135.6m wearbles, vs. ~1.5bn smartphones.
VR headsets have a runrate of, like, 9.2m units:
Virtual reality headsets are moving at a rate of 2.3 million a quarter
But, fast growing:
IDC says shipments are up 77.4 per cent year over year.
Meanwhile, wearables are at something like “33.9 million shipments a month,” like a runrate of 135.6m units.
Meanwhile, taking from this year’s Internet Trends report (sourced from Morgan Stanley), smart phone shipments are under 1.5bn, though slowing in growth:
And then smartphone shipments from IDC (probably where Morgan got those numbers):
For the full year [of 2016], the worldwide smartphone market saw a total of 1.47 billion units shipped, marking the highest year of shipments on record, yet up only 2.3% from the 1.44 billion units shipped in 2015.
Casper had been out raising a large round of funding when the talks started, sources said. The startup generated around $200 million in sales in 2016 — its second full year in business — and was valued at around $550 million after its last private investment in 2015.
And, as the headline says: “Target looked at buying the mattress startup Casper for $1 billion but will invest instead.”
There’s a fair amount of commentary on this type of e-commerce stuff in this year’s Internet Trends report as well.
Shareholders will also be asked to approve a $500m return of value, approximately $2.09 per share,” the statement to the City added.
Well, who doesn’t like money?
That said, performance is declining:
The [HPE Software?] business has shrunk in recent years, with turnover dropping from $4.06bn in fiscal 2012 ended 31 October to $3.19bn in fiscal 2016. Profit before tax during that period slipped too. In HPE’s Q1 ended January, sales in the software arm fell 8 per cent year-on-year to $721m.
All that M&A didn’t work out too well:
The software division at HPE is made up of a collection of separate units including Autonomy, Mercury Interactive, ArcSight, three businesses that alone cost HPE more than $16bn to acquire. Other elements include Vertica (buy price undisclosed) and relatively smaller IT management ops outfits.
For more context, see my notebook on the HPE/Micro Focus merger back in September, 2016.
According to a recent research report from eMarketer, 60.5 million Americans will talk at least once a month to their virtual personal assistants named Siri, Cortana, Alexa, and other as-yet unknowns this year. “That equates to 27.5% of smartphone users, or nearly one-fifth of the population,” eMarketer said. Link
More details on the study:
- “The e-commerce giant’s Amazon Echo and Echo Dot devices will claim a 70.6 percent share of the U.S. market this year, the study found.”
- That 60.5m figure is more like “penetration,” people who have tried voice stuff but aren’t active users. By device ownership (I don’t know if this includes or excludes phones with Siri and such): “The number of active U.S. users will more than double for the devices this year, to 35.6 million, eMarketer said.”
Personally, I still find all this obnoxious. But (a.) I’m more of a podcast and text person, and, (b.) hey, the Echo is a really nice Bluetooth/Spotify speaker.
Some highlights from a recent survey on container usage among 338 respondents to a Anchore/DevOps.com survey:
…approximately one third of the participants are running containers in production, with development coming in slightly higher.
Looking at the top five host operating systems across user roles we see Ubuntu having a particular strong lead among developers and architects.
Interestingly Mesos still features strongly with architects. Among developer communities we very rarely hear Mesos mentioned anymore. On the other hand we frequently encounter architects have invested in Mesos from the perspective of their big data environments and are looking at a common approach for their container strategy. That said, this entire market is extremely fluid at the moment.
…the combination of Jenkins and CloudBees (commercial Jenkins) approaching 50%.
Bluntly put [security] presents a barrier to adoption, and an opportunity for conservative organisations to hold off on adopting new technologies.
Our population breaks out with over 60% working in companies of greater than 100 people [and ~30% working in companies of greater than 5,000 people]…. With any data set of this nature, it is important to state that survey results strictly reflect the members of the DevOps.com community.
- As you’ll recall, 451 estimates that the container market will be $2.7bn in 2020.
- A 451 Research 1Q16 survey puts production use of containers at ~14%. It’s likely risen sense then, of course: maybe to around 18 to 20%?
- A 3Q2015 survey put “container orchestration” use at just ~9%. Presumably this is dev/test and production, all uses. And, again, you’d assume that it’s risen since then. The question would be: are people using containers in production without orchestration? That seems slightly crazy except for the simplest workloads, eh?
One of the more common questions I’ve had over the years is: “but, surely, everyone is just in the public cloud, right?” I remember having a non-productive debate with a room full of Forrester analysts back in about 2012 where they were going on and on about on-premise IT being dead. There was much talk about electricity outlets. To be fair, the analysts were somewhat split, but the public cloud folks were adamant. You can see this same sentiment from analysts (including, before around 2011, myself!) in things like how long it’s taken to write about private PaaS, e.g., the PaaS magic quadrant has only covered public PaaS since inception).
Along these lines, the Uptime Institute has some survey numbers out. Here’s some highlights:
Some 65% of enterprise workloads reside in enterprise owned and operated data centers—a number that has remained stable since 2014, the report found. Meanwhile, 22% of such workloads are deployed in colocation or multi-tenant data center providers, and 13% are deployed in the cloud, the survey found….On-prem solutions remain dominant in the enterprise due to massive growth in business critical applications and data for digital transformation, Uptime Institute said
Some 95% of IT professionals said they had migrated critical applications and IT infrastructure to the cloud over the past year, according to another recent survey from SolarWinds.
That survey also found that nearly half of enterprises were still dedicating at least 70% of their yearly budget to traditional, on-premise applications, potentially pointing to growing demand for a hybrid infrastructure….
Nearly 75% of companies’ data center budgets increased or stayed consistent in 2017, compared to 2016, the survey found.
Metrics, KPIs, and what organizations are focusing on (uptime):
More than 90% of data center and IT professionals surveyed said they believe their corporate management is more concerned about outages now than they were a year ago. And while 90% of organizations conduct root cause analysis of an IT outage, only 60% said that they measure the cost of downtime as a business metric, the report found.
Demographics: “responses from more than 1,000 data center and IT professionals worldwide.”
Pretty much all Pivotal Cloud Foundry customers run “private cloud.” Many of them want to move to public cloud in a “multi-cloud” (I can’t make myself say “hybrid cloud”) fashion or mostly public cloud over the next 5 to ten years. That’s why we support all the popular public clouds. Most of them are doing plenty of things in public cloud now – though, not anywhere near “a whole lotta” – and there are of course, outliers.
This does bring up a nuanced but important point: I didn’t check out the types of workloads in the survey. I’d suspect that much of the on-premises workloads are packaged software. There’s no doubt plenty of custom written application run on-premises – even the majority of them per my experience with the Pivotal customer base. However, I’d still suspect that more custom written applications were running in the public cloud than other workloads. Just think of all the mobile apps and marketing apps out there.
Also, see some qualitative statements from CIO types.
So, the idea that it’s all public cloud in enterprise IT, thus far, is sort of like, you know: ¯_(ツ)_/¯
[Q3, FY 2017] Also of note, we closed our second OpenShift deal over $10 million and another OpenShift deal over $5 million. And significantly, we actually had over 50 OpenShift deals alone that were six or seven figures, so really strong traction. [Q4, FY 2017] with our largest deals in Q4 approximately one-third had an OpenShift container platform component.
During the final three months of last year, subscription revenue for Red Hat’s application development-related [JBoss, etc] and other emerging technologies – which includes OpenShift – hit $125 million, a 40 percent increase from the same period in 2015, and revenue for the group accounted for about 20 percent of Red Hat’s overall revenues for the fourth quarter.
Today, we also announced that Barclays Bank, the Government of British Columbias Office of the CIO, and Macquarie Bank are also using Red Hat OpenShift Container Platform to modernize application development…. airplane manufacturer Airbus about their DevOps journey, and digital travel platform Amadeus about their transformation of handling 2,000x the number of online transactions…. how Amsterdams Schipol Airport (AMS) is using OpenShift to redefine the in-terminal travel experience, how Miles & More GmbH is better managing rewards programs for travelers, and how ATPCO is rethinking how they publish fare-related data to the airline and travel industry.
The OpenShift Commons community has 260+ member organizations….Red Hat engineers lead or co-lead in 10 of the 24 Kubernetes SIG activities.
The huge architectural shift that we made a few years ago in adopting open standards for containers and the Kubernetes container scheduler has allowed us to delivered a unified platform to containerize existing applications and deliver agility and scalability for cloud-native applications and microservices. We call this combination Enterprise Kubernetes+, or Enterprise-Ready Kubernetes.
With DockerCon this week, there’s no end of Docker quotables and items. Here’s my collection
Once landed in an account, Docker usage grows their CEO says:
There has also been expansion within customers, with organizations that start with Docker expanding their usage on average by five times within six months
Way back in 2015, the (now annual?) DataDog study of Docker usage among their customers said that 2/3 of companies that try Docker adopt it. Which is all to say: once it gets in, it spreads.
A toolkit for putting together docker stacks:
In essence, Moby is the build system that creates Docker Community Edition, which is akin to Fedora, and Docker Enterprise is derived from Moby and is akin to Red Hat Enterprise Linux. Link
People got all freaked out. I’d even say “freaked the fuck out.” Competitors, of course, gloated, if only in silence. Criticism of handling the announcement aside (ideally, you wouldn’t like to kick up a stink), I feel like it was more like a tempest in a teapot.
Docker momentum/penetration and types of applications/workloads
Global 2000 customers have somewhere on the order of thousands to tens of thousands of applications, and across these major firms, less than 5 percent of the applications have been containerized so far. While somewhere between 5 percent and 10 percent of the applications that are being containerized are net-new, microservices-style applications that everyone is talking about all the time, the other 90 percent to 95 percent are just lifting and shifting legacy applications from bare metal or virtual machines to containers. Link
VMware threat…or just legacy gobbling?
Docker bounces back and forth between “replacement for VMware” and “a different thing, so don’t worry about VMware.” In this round of Docker news, there’s been some strong pull towards the “replacement for VMware” camp. To be fair, it’s more like doing both:
In general, says Johnston, customers who move from bare metal or VMs to Docker containers can provision, scale, and deploy applications up to 75 percent faster, and those moving from bare metal to containers can save 50 percent on compute and those who are moving from VMs will save around 25 percent. Link
This might also come from the obvious move to start gobbling up legacy (more accurately “existing”) applications. Here, Docker had two customer reference:
Northern Trust, a leading international financial services company, experienced deployment times that were 4X faster and noted a 2X improvement in infrastructure utilization
And, Microsoft IT:
Microsoft is not only a partner in this program; their IT organization is also a beta customer. Microsoft IT increased app density 4X with zero impact to performance and were able to reduce their infrastructure costs by a third.
There was also a story of Visa using Docker:
Kocherlakota said Visa is aiming to move as many workloads at it can to the container model to help improve overall efficiency.
Other tech companies are often cautious about working with Docker. They’re not really certain about how it helps or threatens their position in the IT stack and, therefore, their ability to sell higher profit margin products and services. No one wants to become the x86 manufacturer of the cloud (read: low margin, commodity).
I’ve noticed this cautiousness slightly melting as more and more vendors are at least putting their stuff in Docker images and, on the public cloud front, supporting the use of Docker. My company, Pivotal, ingests Docker images.
A brief whack at why Microsoft cares, from Christopher Tozzi:
Although there remains work to do to get Docker on Windows ready for prime time, the platform will be important in helping Windows Server stay as nimble as Linux environments in hosting the workloads of the future…. Microsoft’s interest in Docker may seem strange. Microsoft already offers traditional virtual machine products, most notably Hyper-V. In some respects, Docker containers compete with virtual machine platforms…. But that’s not necessarily the case. Depending on how they’re used, containers can complement virtual machines, rather than replace them. If you use virtual machines to host the environment in which Docker runs, your Docker environment becomes more scalable and portable than it would be if it ran on bare metal. That’s likely the type of use case Microsoft envisions for containers on Windows.
More from Nick Martin on Microsoft and Docker.
Oracle becomes the latest enterprise IT vendor to jump on the Docker container bandwagon as it seeks to expand its reach in the public cloud market. Among the container-based application, middleware and development tools made available on the container platform are Oracle’s MySQL database and its WebLogic server. Those tools are in addition to the more than 100 images of Oracle products already available on Docker Hub, its cloud-based image registry.
So, what’s going on here? Staking a claim on The New Stack
I’m often asked to explain all the various cloud stacks, to help Pivotal buyers sort out what CaaS, PaaS, cloud-native, and “cloud strategy” means. They’re trying to figure out their planning for building out new IT, for “doing DevOps.” It’s a mess out there w/r/t to figuring all this out if you’re not a vendor or analyst who’s steeped in this shoggoth every day.
In all the Docker, container, and cloud-native wars, the revenue battle for vendors is mostly about two things:
- The pool of money in simply migrating the VMware workload to a new, more efficient layer, hence the ongoing attention to “the VMware threat” that Docker poses). I’m not sure how big this market is because, as a disruptive shift (cf. Linux vs. UNIX vs. Windows vs. z) part of it is reducing the overall spend through lower prices and more efficient usage. But, the existing virtualization market is best described as “fucking huge.”
- Fighting over who “owns” (and therefore collects the most profit from) the stack that companies are using to build and run their software. By my estimate, this is something like around a $20-25bn market in the future. You can see a Spanish Civil War like precursor going on in the Java application server market; it’s spreading to a “World War” with respect to all custom software stacks.
On that second point, here’s my latest attempt to describe how things are shaking out category/definition wise:
Of all the SPI cloud categories, PaaS is the most problematic place as all us vendors hate the PaaS term and are trying to re-define what it means. I would break PaaS into two categories currently: (1.) container orchestration, and, (2.) cloud platform.
Container orchestration takes an IaaS and manages the installation and configuration of container images on your new cloud. By “images” here, I mean that you’ve chosen to put your software (probably custom written software, not packaged software) into containers (or the delegated way we do it with buildpacks in CF), specified how all the different nodes are wired together with all the ACLs and configuration, and then given it over to the orchestration software to deploy those containers, set the configuration, and do the ongoing health-checks/remediation.
Ideally, the orchestration platform should also have “day 2” tools to help you monitor and manager (“fix”) problems that happen in production. I assume things like kubernetes, the Docker/Moby constellation of things, Mesosphere, etc. fit here.
People are obsessed with container orchestration now and it’s pretty much all anyone talks about. I think all this is what’s becoming known as “CaaS” – Containers as a Service.
(On this next section, I’m extremely monetarily biased, of course:) A cloud platform either has or depends on an orchestration layer, but adds in integrated middle-ware, ALM tools (from basics like “cf push”, and an overall programming and deployment model with all the tools and enforcements. Heroku is the classic example here in public cloud, and now Cloud Foundry (CF) has taken over this model in public and private cloud, the second (it seems) where most of the usage and money is, at least in the enterprise space. I’d argue, that CF is the enterprise market-leader (by revenue at least, but increasingly penetration in the F500 – while Pivotal has impressive numbers, throw in the other CF distros and it’s even larger, no doubt); at the very least, “the highest growth and in enterprise production usage.” That all depends how you slice it, and of course my slicing favors me.
A cloud platform “pulls together” everything into a fully working “cloud” that deploy and provisions the servers, builds/maintains/deploys the containers, takes care of your networking configuration and concerns (inc. firewalls, etc.), and configs/manages all the middleware needed (e.g. “I want a database” means you just ask for it, instead of having to configure it and make container images of it and specify how it all works together).
The end goal of a cloud platform is the original end-goal of a PaaS: developers don’t have to “setup” any of the infrastructure or, really, middleware (databases, queues, etc.) that they use: they just write the “business logic” of their applications.
All this standardization is technically “restrictive” (developers can’t just install anything they download off the Internet, it has to be integrated into the platform). This is why we often call this model “opinionated,” but it follows the same contract/promises model that Google SREs follow: we promise we can support your applications in production if you use only the things we support, otherwise it’s all on you.
However, the benefit of such opinions is a huge jump in productivity as we see at all our customers: one Pivotal customer manages 1,000+ applications (all angles toward very frequent, DevOps-style releases for fast feedback loops and all that small batch stuff) with just 4 PCF operations staff, etc.
Our DIY white paper makes the case that snow-flaking this all out is a bad idea. At the very least, if you build your own platform, you should try to just have one used organization wide.
In comparing CaaS and cloud platform, the key distinction to me is that a cloud platform bundles and integrates together all your middleware and “services” frameworks. For example, if you want to do microservices with all the bulk-heads and such, that functionality should be built into the cloud platform – you should have to go read-up how to set most of that up. PCF, of course, has Spring Cloud and more for that. All of the systems management tools (thing used in production to detect and fix problems) should also be built in, or the cloud platform should be instrumented so deeply that third party tools can do the managing as well.
Now, these two categories are likely to converge, and then the discussion will just be which cloud platforms are more featureful and better. It’ll be like battling Java application servers.
I haven’t made one of my own “burger” stacks of all this in a long time, but I think (again, highly biased) the ones we use for PCF are pretty good:
- A simple, cartoon one.
- More detailed stack, emphasizing “the value line,” i.e., “all things below this line have no differentiating business value and you should therefore buy instead of build them.”
- A pretty good, fancy-pants one.
- Some general analysis of Docker being used for mixed workloads and “hybrid cloud,” from Rhett Dillingham at Moor Insights & Strategy.
- As a reminder, 451’s container market-sizing: Container market to be $2.7B by 2020, from $762m in 2016.
- And, Microsoft’s purchase of Deis recently is another good example of stuff going on in this space.
In case you don’t know, working at Pivotal, I obviously have a stake in how all this turns out, so I’m biased on multiple angles of the above whether I want to be or not.