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The Next Technology Boom is Already Underway at Cisco, F5 Networks, Riverbed and VMware

Clouds, Virtualization and IT Diseconomies

Greg Ness's Blog

Infrastructure2.0 is the next technology boom. It is already underway. Cisco, F5 Networks, Riverbed and even VMware promise to benefit from this new infrastructure and the level of connectivity intelligence it promises. (More about these companies and others later in this article.)


Cloud computing has become a reality, yet the hype surrounding cloud has started to exceed the laws of physics and economics. The robust cloud (of all software on demand that will replace the enterprise data center) will crash into some of the same barriers and diseconomies that are facing enterprise IT today.

Certainly there will always be a business case for elements of cloud, from Google's pre-enterprise applications to Amazon's popular services and the powerhouse of CRM, HR and other popular cloud services. Yet there are substantial economic barriers to entry based on the nature of today's static infrastructure.

We've seen this collision between new software demands and network infrastructure many times before, as it has powered generations of innovation around TCP/IP, network security and traffic management and optimization.

It has produced a lineup of successful public companies well positioned to lead the next tech boom, which may even be recession-proof. Cisco, F5 Networks, Riverbed and even VMware promise to benefit from this new infrastructure and the level of connectivity intelligence it promises. (More about these companies and others later in this article.)


Static Infrastructure meets Dynamic Systems and Endpoints

I recently wrote about clouds, networks and recessions by taking a macro perspective on the evolution of the network and a coming likely recession. I also cited virtualization security as an example of yet another big bounce between more robust systems and static infrastructure that has slowed technology adoption and created demands for newer and more sophisticated solutions.

I posited that VMware was a victim of expectations enabled by the promise of the virtualized data center muted with technological limitations its technology partners could not address quickly enough. Clearly the network infrastructure has to evolve to the next level and enable new economies of scale. And I think it will.

Until the current network evolves into a more dynamic infrastructure, all bets are off on the payoffs of pretty much every major IT initiative on the horizon today, including cost-cutting measures that would be employed in order to shrink operating costs without shrinking the network.

Automation and control has been both a key driver and a barrier for the adoption of new technology as well as an enterprise's ability to monetize past investments. Increasingly complex networks are requiring escalating rates of manual intervention. This dynamic will have more impact on IT spending over the next five years than the global recession, because automation is often the best answer to the productivity and expense challenge.

Networks Frequently Start with Reliance on Manual Labor

Decades ago the world's first telecom networks were simple and fairly manageable, at least by today's standards. The population of people who had telephones was lower than the population of people who today have their own blogs. Neighborhoods were also very stable and operators often personally knew many of the people they were connecting.



Those days of course are long gone, and human operators are today only involved in exceptional cases and highly-automated fee-based lookup services. The Bell System eventually automated the decisions made by those growing legions of operators, likely because scale and complexity were creating the diseconomies that larger enterprise networks are facing today. And these phone companies eventually grew into massive networks servicing more dynamic rates of change and ultimately new services. Automation was the best way to escape the escalating manual labor requirements of the growing communications network.

TCP/IP Déjà vu

A very similar scenario is playing itself out in the TCP/IP network as enterprise networks grow in size and complexity and begin handling traffic in between more dynamic systems and endpoints. The recent Computerworld survey (sponsored by Infoblox) shows larger networks paying a higher IPAM price per IP address than smaller networks. As I mentioned earlier at Archimedius, this shows clear evidence of networks growing into diseconomies of scale.

Acting on a hunch, I asked Computerworld to pull more data based on network size, and they were able to break their findings down into 3 network size categories: 1) under 1000 IP addresses; 2) 1k-10k IP addresses; and 3) more than 10k IP addresses. Because the survey was only based on about 200 interviews I couldn't break the trends down any farther without taking some statistical leaps with small samples.

Consider what it takes to keep a device connected to an IP network and ensure that it's always findable. First, it will need an unused IP address. In a 1.0 infrastructure administrators use spreadsheets to track used and available IPs and assign them to things that are "fixed", like printers and servers.

More Stories By Greg Ness

Greg Ness is a Silicon Valley marketing veteran with background in networking, security, virtualization and cloud computing. He is VP Marketing at CloudVelocity. Formerly at Vantage Data Centers, Infoblox, Blue Lane Technologies, Juniper Networks, Redline Networks, McAfee, IntruVerofficer at Networks and ShoreTel. He is one of the world's top cloud bloggers.

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