Expect more ‘mega partnerships’ among technology vendors

These partnerships, exemplified by SAP and IBM are generally “good news” for CIOs, but those whose providers are outside these agreements should carefully look at their contracts and SLAS, says Holger Mueller of Constellation Research.

SAP’s latest deal with IBM, as it expands into the cloud, is just the latest trend in the industry today - ‘mega partnerships’ among major technology providers.

"CIOs should expect more partnerships like these," says Holger Mueller, principal analyst and vice president Constellation Research.

In the latest deal, IBM and SAP announced a partnership to move the SAP HANA Enterprise Cloud onto IBM’s cloud, powered by SoftLayer.

“Large vendors that previously may not have partnered in the past are now finding synergistic partnerships and at the same time trying to get a leg up on their competitors,” he states.

"This is a win/win for joint customers of SAP and IBM," he says. “Customers get an enterprise friendly cloud infrastructure with a high number of geographical locations.

“SAP gets a partner in building out IaaS infrastructure and can focus more on enterprise software investments while IBM gets key load for its cloud on a worldwide scale.

“Going forward we need to see how attractive this partnership will be for customers that are not already IBM customers."

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“CIOs who are customers of such a joined partnership should see this as good news,” he adds. “Those whose products and services are outside these mega partnerships should carefully look at contracts and SLAs so their enterprise does not get lost in the process.”

Mueller, meanwhile, notes how the partnership will impact both SAP and IBM customers.

SAP customers worried about SAP’s expertise to build out data centres can now rely on a proven vendor with more than the SAP load, he states. Concerns about SAP not having local data centres maybe addressed by the IBM existing and planned data centre locations.

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CIOs whose products and services are outside these mega partnerships should carefully look at contracts and SLAs so their enterprise does not get lost in the process.

Holger Mueller, Constellation Research

Enterprise loads that may not have moved to the cloud because of data residency and privacy concerns may now be moved, if IBM Cloud can provide in country or economic region based data centres.

Existing IBM Cloud customers that also use SAP now have more load that can be brought to their cloud infrastructure of choice. Negotiate SLAs and discounts hard with IBM, he advises.

“Also, before going ‘all in’ with IBM (as with any other cloud provider), customers need to think twice, both from a contractual and commercial tie in with a single vendor,” he adds.

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“If the SLA may transfer to SAP, look at the fine print. And inquire on the timelines of the HANA on POWER certification project, as this may offer better price / performance ratio and will certainly see IBM being motivated to promote its POWER platform.”

The partnership also has impact for their competitors, as IBM competitors will try to get their SAP partnerships in place ASAP, he states.

SAP is the largest single vendor for potential enterprise software load, and too big target not to compete for. But IBM is the first out of the gate and if data centre locality matters, it has an advantage in terms of earlier investments.

“We expect both VMware and other cloud services providers to ramp up SLA level and guarantees, using partner data centres."

Read more: Finzsoft moves core and vertical banking applications to IBM cloud

Send news tips and comments to divina_paredes@idg.co.nz

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