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May 09, 2014

HP bets "Hey! You'll, get onto your cloud!"

TalltorideHewlett-Packard announced that it will spend $1 billion over the next two years to help its customers built private cloud computing. Private clouds will need security, and they'll begin to behave more like the HP 3000 world everybody knows: management of internal resources. The difference will reside in a standard open source stack, OpenStack. It's not aimed at midsize or smaller firms. But aiding OpenStack might help open some minds about why clouds can be simple to build, as well as feature-rich.

This is an idea that still needs to lift off. Among the 3000 managers we interview, there are few who've been in computing since the 1980s who are inclined to think of clouds much differently than time-sharing, or apps over the Internet. Clouds are still things in Rolling Stones or Judy Collins choruses.

The 3000 community that's moving still isn't embracing any ideal of running clouds in a serious way. Once vendor who's teeing up cloud computing as the next big hit is Kenandy. That's the company built around the IT experience and expertise of the creators of MANMAN. They've called their software social ERP, in part because it embraces the information exchange that happens on that social network level.

But from the viewpoint of Terry Floyd, founder of the manufacturing services firm The Support Group, Kenandy's still waiting for somebody from the 3000 world to hit that teed-up ball. Kenandy was on hand at the Computer History Museum for the last HP3000 Reunion. That gathering of companies now looks like the wrong size of ball to hit the Kenandy cloud ERP ball.

"Since we saw them at the Computer History Museum meeting, Kenandy seems to have has re-focused on large Fortune 1000 companies," Floyd said. There are scores of HP 3000 sites running MANMAN. But very few are measuring up as F1000 enterprises. Kenandy looks like it believes the typical 3000 site is not big enough to benefit from riding a cloud. There are many migrated companies who'd fit into that Fortune 1000 field. But then, they've already chosen their replacements.

The Kenandy solution relies on the force.com private cloud, operated by Salesforce.com. Smaller companies, the size of 3000 customers, use Salesforce. The vendor's got a force.com cloud for apps beyond CRM. But the magnitude of the commitment to Kenandy seems larger than the size of the remaining 3000 sites which manufacture using Infor's MANMAN app.

"Most MANMAN sites don't meet their size requirements," Floyd said. "I have a site that wants to consider Kenandy next year, but so far Kenandy is not very interested. We'll see if they are serious when the project kicks off next year, because we think Kenandy is a good fit for them."

The longer that small companies wait out such cloud developments as HP's $500 million per year, the better the value becomes for getting onto their cloud, migrating datacenter ops outside company walls. HP is investing to convince companies to build their own private clouds, instead of renting software from firms like Kenandy and Salesforce. Floyd and his company have said there's good value in switching to cloud-based ERP for some customers. Customization of the app becomes the most expensive issue.

This is the central decision in migrating to cloud-based ERP from a 3000. It's more important than how much the hardware to support the cloud will cost. HP's teaming up with Foxconn -- insert snarky joke here -- to drive down the expense of putting up cloud-optimized servers. But that venture is aimed at telecommunications companies and Internet service providers. When Comcast and Verizon, or Orange in Europe, are your targets, you know there's a size requirement.

You might think of the requirements for this sort of cloud -- something a customer would need to devote intense administrative resources to -- as that sign at the front of the best amusement park rides. "You must be Fortune 1000 tall to ride this ride," it might say. Maybe, over the period of HP's new cloud push, the number on the sign will get smaller.

10:04 AM in Migration, News Outta HP | Permalink

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