BriefingsDirect SOA Insights Analysts Examine Microsoft SOA and Evaluate Green IT

Edited transcript of weekly BriefingsDirect[TM] SOA Insights Edition podcast, recorded October 26, 2007.

Listen to the podcast here.

Dana Gardner: Hello, and welcome to the latest BriefingsDirect SOA Insights Edition, Volume 27. A weekly discussion and dissection of Services Oriented Architecture (SOA) related news and events with a panel of industry analysts, experts and guests.

I'm your host and moderator, Dana Gardner, principal analyst at Interarbor Solutions. We’re joined today by a handful of prominent IT analysts who cover SOA and related areas of technology, business, and productivity.

Topics we're going to discuss this week include the SOA & Business Process Conference held by Microsoft in Redmond, Wash., at which Microsoft announced several product roadmaps and some strategy direction around SOA.

We're also going to discuss issues around "Green SOA." How will SOA impact companies, as they attempt to decrease their energy footprint, perhaps become kinder and gentler to the environment and planet earth, and what SOA might bring to the table in terms of a long-term return on investment (ROI), when energy related issues are factored in?

To help us sort through these issues, we’re joined this week by Jim Kobielus. He is a principal analyst at Current Analysis. Welcome back, Jim.

Jim Kobielus: Hi, Dana. Hello, everybody.

Gardner: We're also joined by Neil Macehiter, principal analyst at Macehiter Ward-Dutton in the UK. Thanks for coming along, Neil.

Neil Macehiter: Hi, Dana. Hi, everyone.

Gardner: Joe McKendrick, an independent analyst and blogger. Welcome back to the show, Joe.

Joe McKendrick: Thanks, Dana, glad to be here.

On Microsoft-Oriented Architecture and the SOA Confab ...

Gardner: Let’s dive into our number one topic today. I call it Microsoft Oriented Architecture -- MOA, if you will -- because what we've been hearing so far from Microsoft about SOA relates primarily to their tools and infrastructure. We did hear this week some interesting discussion about modeling, which seems to be a major topic among the discussions held at this conference on Tuesday, Oct. 30.

It's going to be several years out before these products arrive -- we probably won’t even see data until well into 2008 on a number of these products. Part of the logic seems to be that you can write anywhere, have flexibility in your tooling, and then coalesce around a variety of models or modeling approaches to execute through an über or federated modeling approach that Microsoft seems to be developing. That would then execute or deploy services on Microsoft foundational infrastructure.

I'm going to assume that there is also going to be loosely coupled interoperability with services from a variety of different origins and underlying infrastructure environments, but Microsoft seems to be looking strategically at this modeling layer, as to where it wants to bring value even if it’s late to the game.

Let’s start with Jim Kobielus. Tell us a little bit about whether you view Microsoft's moves as expanding on your understanding of their take on SOA, and what do you make of this emphasis on modeling?

Kobielus: First, the SOA universe is heading toward a model-driven paradigm for distributed service development in orchestration, and that’s been clear for a several years now. What Microsoft has discussed this week at its SOA and BPM conference was nothing radically new for the industry or for Microsoft.

Over time, with Visual Studio and the .NET environment, they've been increasingly moving toward a more purely visual paradigm. "Visual" is in the very name of their development tool. Looking at the news this week from Microsoft on the so-called Oslo initiative, they are going to be enhancing a variety of their Visual Studio, BizTalk Server, BizTalk Services, and Microsoft System Center, bringing together the various metadata repositories underlying those products to enable a greater model-driven approach to distributed development.

Gardner: They get into some BizTalk too, right?

Kobielus: Yes, BizTalk Server for premises-based and BizTalk Services, software as a service (SaaS), the channel through which it can deliver BizTalk functionality going forward. I had to pinch myself and ask myself what year this is. Oh, it’s 2007, and Microsoft is finally getting modeling religion. I still remember in 2003-2004 there was a big up swell of industry interest in model-driven architecture (MDA).

Gardner: We've had some standards developed in the industry since then too, right?

Kobielus: I was thinking, okay, that’s great, Microsoft, I have no problem with your model-driven approach. You're two, three, or four years behind the curve in terms of getting religion. That’s okay. It’s still taking a while for the industry to completely mobilize around this.

In order words, rather than developing applications, they develop business models and technology models to varying degrees of depth and then use those models to automatically generate the appropriate code and build the appropriate sources. That’s a given. One thing that confuses me, puzzles me, or maybe just dismays me about Microsoft’s announcement is that there isn't any footprint here for the actual standards that have been developed like OMG’s unified modeling language (UML), for example.

Microsoft, for some reason I still haven’t been able to divine, is also steering clear of UML in terms of their repositories. I'm not getting any sense that there is a UDDI story here or any other standards angle to these converged repositories that they will be rolling out within their various tools. So, it really is a Microsoft Oriented Architecture. They're building proprietary interfaces. I thought they were pretty much behind open standards. Now, unless it’s actually 2003, I have to go and check my calendar.

Gardner: They did mention that they're going to be working on a repository technology for Oslo metadata, which will apparently be built into its infrastructure services and tools. There was no mention of standards, and part of the conceptual framework around SOA is that there has to be a fairly significant amount of standardization in order to make this inclusion of services within a large business process level of activity possible.

Some of the infrastructure, be it repository, ESB, management, or governance, needs to be quite open. So, you're saying you're not sure that you're seeing that level of openness. It reminds us of the CORBA versus COM and DCOM situation. OMG was involved with that and supported the development of CORBA

Let’s go to Neil Macehiter. Do you see this as MOA or do you think that they are going to have to be open, if it’s going to be SOA values?

Macehiter: I don’t see this as exclusively Microsoft-oriented, by any stretch. I’d also question Jim’s comment on there being nothing radically new here. There are a couple of elements to the strategy that Microsoft’s outlined that differentiate it from the model-driven approaches of the past.

The first is that they are actually encompassing management into this modeling framework, and they're planning to support some standards around things like the service modeling language (SML), which will allow the transition from development through to operations. So, this is actually about the model driven life cycle.

The second element where I see some difference is that Microsoft is trying to extend this common model across software that resides on premises and software that resides in the cloud somewhere with services. So, it has a common framework for delivering, as Microsoft refers to it, software plus services. In terms of the standard support with respect to UML, Microsoft has always been lukewarm about UML.

A few years ago, they were talking about using domain specific language (DSL), which underpin elements of Visual Studio that currently exist, as a way of supporting different modeling paradigms. What we will see is the resurgence of DSL as a means of enabling different modeling approaches to be applied here. The comment regarding UDDI is only one element at the repository, because where Microsoft is really trying to drive this is around a repository for models, for an SML model or for the models developed in Visual Studio, which is certainly broader.

Gardner: There really aren’t any standards for unifying modeling or repository for various models.

Macehiter: No, so this smacks of being a very ambitious strategy from Microsoft, which is trying to pull together threads from different elements of the overall IT environment. You've got elements of infrastructure as a service, with things like the BizTalk Services, which has been the domain of large Web platforms. You've got this notion of computer applications in BPM which is something people like IBM, BEA, Software AG, etc. have been promoting.

Microsoft has got a broad vision. We also mustn’t forget that what underpins this is the vision to have this execution framework for models. The models will actually be executed within the .NET framework in the future iteration. That will be based on the Window’s Communication Foundation, which itself sits on top of the WS-* standards and then also on top of Windows Workplace Foundation.

So, that ambitious vision is still some way off, as you mentioned -- beta in 2008, production in 2009. Microsoft is going to have to bring its ISVs and systems integrator (SI) community along to really turn this from being an architecture that's oriented towards Microsoft to something broader.

Gardner: Now, Neil, if Microsoft is, in a sense, leapfrogging the market, trying to project what things are going to be several years out, recognizing that there is going to be a variety of modeling approaches, and that modeling is going to be essential for making SOA inclusive, then they are also going to be federating, but doing that vis-à-vis their frameworks and foundations.

If there is anything in the past that has spurred on industry standards, it's been when Microsoft puts a stake in the ground and says, “We want to be the 'blank,'” which, in this case, would be the place where you would federate models.

Kobielus: I’m glad you mentioned the word "federation" in this context, because I wanted to make a point. I agree with Neil. I’m not totally down on what Microsoft is doing. Clearly, they had to go beyond UML in terms of a modeling language, as you said, because UML doesn’t have the constructs to do deployment and management of distributed services and so forth. I understand that. What disturbs me right now about what Microsoft is doing is that if you look at the last few years, Microsoft has gotten a lot better when they are ahead of standards.

When they're innovating in advance of any standards, they have done a better job of catalyzing a community of partners to build public specs. For example, when Microsoft went ahead of SAML and the Liberty Alliance Federated Identity Standards a few years back, they wanted to do things that weren't being addressed by those groups.

Microsoft put together an alliance around a spec called WS-Federation, which just had sort of hit-and-miss adoption in the market, but there has been a variety of other WS-* standards or specifications that Microsoft has also helped to catalyze the industry around in advance of any formal, de-jure standard. I'd like to see it do the same thing now in the realm of modeling.

Macehiter: My guess is that’s exactly what they’re doing by putting a stake in the ground this early. "This is coming from us. There are going to be a lot of developers out there using our tools that are going to be populating our repositories. If you're sensible, you're going to federate with us and, therefore, let’s get the dialogue going." I think that’s partly why the stake is out there as early as it is.

Gardner: Let’s go to Joe McKendrick, Joe, we've seen instances in the past where – whether they're trailing or leading a particular trend or technology -- Microsoft has such clout and influence in the market that they either can establish de-facto standards or they will spur others to get chummy with one another to diminish the Microsoft threat. Do you expect that Microsoft's saying they're going to get in the modeling federation and repository business will prompt more cooperation and perhaps a faster federated standard approach in the rest of the market?

McKendrick: Definitely more and more competitive responses. Perhaps you’ll see IBM, BEA, Oracle, or whatever other entity propose their own approaches. It's great that Microsoft is talking SOA now. It's only been about a year that they have really been active.

Gardner: They didn’t even want to use the acronym. Did they?

McKendrick: I think what's behind this is that Microsoft has always followed the mass market. Microsoft’s sweet spot is the small- and the medium-business sector. They have a presence in the Fortune 500, but where they’ve been strong is the small to medium businesses, and these are the companies that don’t have the resources to form committees and spend months anguishing over an enterprise architectural approach, planning things out. They may be driven by the development department, but these folks have problems that they need to address immediately. They need a focus and to put some solutions in place to resolve issues with transactions, and so forth.

Gardner: That’s interesting, because for at least 10 years Microsoft has had, what shall we say, comprehensive data center envy. They've seen themselves on a department level. They've been around the edges. They've had tremendous success with the client and productivity applications with some major components, including directory and just general operating system level to support servers, and, of course, their tools and the frameworks.

However, there are still very few Fortune 500 or Global 2000 companies that are pure Microsoft shops. In many respects, enterprise Java, distributed computing, and open-standards approaches have dominated the core environment in architecture for these larger enterprises. If Microsoft is going to get into SOA, they're in a better position to do what we’ve been calling Guerrilla SOA, which is on a project-by-project basis.

If you had a lot of grassroots, small-developer, department-level server-oriented activities that Microsoft infrastructure would perhaps be better positioned to be dominant in, then that’s going to leave them with these islands of services. A federated modeling level or abstraction layer would be very fortuitous for them. Anyone have any thoughts about the comprehensive enterprise-wide SOA approach that we have heard from others vendors, versus what Microsoft might be doing, which might not be comprehensive, but could be in a sense grassroots even within these larger enterprise.

Macehiter: The other vendors in the non-Microsoft world might talk about enterprise-wide SOA initiatives and organizations that are planning to adopt SOA on an enterprise-wide basis, based on their infrastructure. The reality is that the number of organizations that have actually gone that far is still comparatively small, as we continually see with the same case-study customers being reintroduced again and again.

Microsoft will have to adopt an alternative model. For example, I think Microsoft will follow a similar model and explore the base they had around the developer community within organizations with things like Visual Studio.

SQL Server is pretty well deployed in enterprise elements of the application platform, by virtue of their being bundled into the OS already. So, they're quite well-positioned to address these departmental opportunities, and then scale out.

This is where some of the capabilities that we talked about, particularly in combination with things like BizTalk Services, allow organizations to utilize workflow capabilities and identity management capabilities in the cloud to reduce the management overhead. The other potential route for Microsoft is through the ISV community.

Gardner: I suppose one counterpoint to that is that Microsoft is well positioned with it's tools, frameworks, skill set, and entrenched positions to be well exploited for creating services, but when it comes to modeling business processes, we're not really talking about a Visual Studio-level user or developer. Even if the tools are visually oriented, the people or teams that are going to be in a position to construct, amend, develop, and refine these business processes are going to be at a much higher level. They're going to be architects and business analysts. They're going to be different types of persons.

They are going to be people who have a horizontal view of an entire business process across the heterogeneous environments and across organizational boundaries. Microsoft is well positioned within these grassroots elements. I wonder if they can, through a modeling federation layer and benefit, get themselves to the place where they are going to be the tools and repository for these analysts and architect level thinkers.

Kobielus: I think they will, but they need to play all this Oslo technology into their dynamics strategy for the line of business applications. The analysts that operate in the dynamics world are really the business analyst, the business process re-engineering analysts, etc., who could really use this higher layer entity modeling environment that Microsoft is putting there. In other words, the analysts we are discussing are the analysts who work in the realm of the SAP or Oracle applications, or the dynamic applications, not the departmental database application developers.

Macehiter: The other community there would be the SIs, who do a lot of this work on behalf of organizations. As part of the Oslo messaging, Microsoft has talked about this sort of capability being much more model-driven than a high level of abstraction, as a means to allow SOAs to become more like all ISVs, in terms of delivering more complete solutions. That’s another key community, where Microsoft just doesn't compete, in contrast to IBM, which is competing directly with the likes of Accenture and CapGemini. That’s another community that Microsoft will be looking to work very closely with around this.

Gardner: In the past, Microsoft did very well by targeting the hearts and minds of developers. Now, it sounds like they are going to be targeting the hearts and minds of business analysts, architects, and business-process level oriented developers. Therefore, they can position themselves as a neutral third party in the professional services realm. They can try to undermine IBM’s infrastructure and technology approach through this channel benefit of working with the good tooling and ease of deployment at the modeling and business-process construct level with these third-party SIs. Is that it?

McKendrick: As an addendum to what you just said, Microsoft isn't necessarily going to go directly after customers of IBM, BEA, etc. IBM is providing this potential to companies that have been under-served, companies that cannot afford extensive SOA consulting or integration work. It's going after the SMB sector, the Great Plains, the dynamics application that Jim spoke of. Those are SMB application. The big companies will go to SAP.

Gardner: So, Microsoft could have something that would be a package more amenable to a company, of say, 300-to-2,000 seats, maybe even 300-to-1,000.

McKendrick: Exactly, Microsoft is the disrupter in this case. There are other markets where Microsoft is being disrupted by Web 2.0, but in SOA, Microsoft is playing the role of disrupter and I think that’s what their strategy is.

Kobielus: I want to add one last twist here. I agree with everything Joe said. Also, the Oslo strategy, the modeling tools, will become very important in Microsoft’s overall strategy for the master data management (MDM) market they have announced already. A year from now, Microsoft will release their first true MDM product that incorporates, for example, the hierarchy and management and cross-domain catalog, management capabilities from their strategic acquisitions.

What Microsoft really needs to be feature-competitive in the MDM market is a model-driven, visual business-process development and stewardship tool. That way teams of business and technical analysts can work together in a customer data-integration, product information-management, or financial consolidation hub environment to build the complex business logic into complex applications under the heading of MDM. If Microsoft's MDM team knows what they are doing and I assume they do, then they should definitely align with the Oslo initiative, because it will be a critical for Microsoft to compete with IBM and Oracle in this phase.

Gardner: As we've discussed on this show, the whole data side of SOA in creating common views, cleaning and translating, schemas and taxonomies, and MDM is extremely important. You can’t do SOA well, if you don’t have a coherent data services strategy. Microsoft is one of the few vendors that can provide that in addition to many of these other things that we're discussing. So, that’s a point well taken. Now, to Joe’s point about the SMB Market, not only would there be a do-it-yourself, on-premises approach to SOA, but there are also SaaS and wire-based approaches.

We've heard a little bit about a forthcoming protocol -- BizTalk Services 1 -- and that probably will relate to Microsoft's Live and other online-based approaches. The end user, be they an architect and analyst or someone who is going to be crafting business processes, if they're using a strictly Web-based approach, they don’t know or care what’s going on beneath the covers in terms of foundations, frameworks, operating systems, and runtime environments. They are simply looking for ease of acquisition and use productivity-scale reliability.

It strikes me that Microsoft is now working towards what might be more of a Salesforce.com, Google, or Amazon-type environment, where increasingly SOA is off the wire entirely. It really is a matter of how you model and tool those services that becomes a king maker in the market. Any thoughts on how Microsoft is positioning these products for that kind of a play?

Macehiter: Definitely. The software plus services, which is the way that Microsoft articulates this partitioning of capability between on-premise software and services delivered in the cloud, is definitely a key aspect of the Oslo strategy and BizTalk Services. It’s just one element of that.

For example, if an organization needs to do some message flow that crosses between organizations over the firewall, BizTalk Services will provide a capability that allows you to explore that declaratively. You can see that evolving, but that’s more infrastructure services. Clearly, another approach might be a high-level service, an application type service, and this architecture that Microsoft is talking about is attempting to address that as well.

This is definitely a key element of the story, which is about making sure that Microsoft remains relevant in the face of in an increasing shift, particularly in the SMB market, towards services delivered in the cloud. It’s about combining the client, the server and services, and providing models in terms the way you think about the applications you need and in terms of the way you manage and deploy them that can encompass that in a way that doesn’t incur significant effort.

Gardner: Perhaps the common denominator between the on-premises approach -- be it departmental level, enterprise-wide, SMB, through the cloud, or though an ecology of providers -- is at this modeling layer. This is the inflection point where, no matter how you do SOA, you’re going to want to be in a position to do this well, with ease, and across a variety of different approaches. Is that fair?

Macehiter: Yes. That’s why this is a better attempt by Microsoft to change the game and push the boundaries. It’s not just a model-driven development revisited in a NDI and a .NET world. This is broader than that.

Gardner: This is classic Microsoft strategy, leapfrogging and trying to get to what the inflection point or the lock-in point might be, and then rushing to it and taking advantage of its entrenched positions.

McKendrick: Forming the mass market, exactly.

Gardner: Let’s move on to our next subject, now that we’ve put that one to rest. The implications are that Microsoft is not out of the SOA game, that it's interested in playing to win, but, once again, on its own terms based on its classic market and technology strategies.

McKendrick: And reaching out to companies that could not afford SOA or comprehensive SOA, which it's done in the past.

On Green SOA and the IT Energy-Use Factor ...

Gardner: Let’s move on to our new subject, Green SOA. SOA approaches and methodologies bring together abstractions of IT resources, developing higher level productivity through business process, management, organization, and governance. How does that possibly impact Green IT?

It's a very big topic today. In fact, it was the top of the strategic technology areas that Gartner Group identified for 2008. Green IT was named number one, a top-ten strategic technology area. How does SOA impact this? Jim Kobielus, you have been given this a lot of thought. Give us the lay of the land.

Kobielus: Thank you, Dana. Clearly, in our culture the Green theme keeps growing larger in all of our lives, and I'm not going to belabor all the ramifications of Green. In terms of Green, as it relates to SOA, you mentioned just a moment ago, Dana, the whole notion of SOA is based on abstraction, service contracts, and decoupling of the external calling interfaces from the internal implementations of various services. Green smashes through that entire paradigm, because Green is about as concrete as you get.

SOA focuses on maximizing the sharing, reuse, and interoperability of distributed services or resources, application logic, or data across distributed fabrics. When they're designing SOA applications, developers aren't necessarily incentivized, or even have the inclination, to think in terms of the ramifications at the physical layer of these services they're designing and deploying, but Green is all about the physical layer.

In other words, Green is all about how do human beings, as a species, make wise use and stewardship of the earth’s nonrenewable, irreplaceable resources, energy or energy supplies, fossil fuels, and so forth. But also it’s larger than that, obviously. How do we maintain a sustainable culture and existence on this planet in terms of wise use of the other material resources like minerals and the soil etc.?

Gardner: Isn't this all about electricity, when it comes to IT?

Kobielus: Yes, first and foremost, it’s pitched at the energy level. In fact, just this morning in my inbox I got this from IBM: "Join us for the IBM Energy Efficiency Certificate Announcement Teleconference." They're going to talk about energy efficiency in the datacenter and best practices for energy efficiency. That’s obviously very much at the core of the Green theme.

Now, getting to the point of how SOA can contribute to the greening of the world. SOA is the whole notion of consolidation -- consolidation of application logic, consolidation of servers, and consolidation of datacenters. In other words, it essentially reduces the physical footprint of the services and applications that we deploy out to the mesh or the fabric.

Gardner: Aren't those things independent of SOA? I mean, if you're doing datacenter consolidation and modernization, if you are moving from proprietary to standards-based architectures, what that has got to do with SOA?

Kobielus: Well, SOA is predicated on sharing and reuse. Okay, your center has a competency. You have one hunk of application logic that handles order processing in the organization. You standardize on that, and then everybody calls that, invokes that over the network. Over time, if SOA is successful other centers of development or other deployed instances of code that do similar things will be decommissioned to enable maximum reuse of the best-of-breed order-processing technology that’s out there.

As enterprises realize the ROI, the reuse and sharing should naturally lead to greater consolidation at all levels, including in the datacenter. Basically, reducing the footprint of SOA on the physical environment is what consolidation is all about.

Gardner: So, these trends that are going concurrently -- unification, consolidation, and virtualization -- allow you to better exploit those activities and perhaps double down on them in terms of a fewer instances of an application stack, but more opportunity to reuse the logic and the resources more generally. So a highly efficient approach that ultimately will save trees and put less CO₂ in the atmosphere.

Kobielus: I want to go back to Microsoft. Four years ago, in 2003, I went to their analyst summit in Redmond. They presented something they called service definition modeling language (SDML) as proprietary spec and a possible future spec for modeling services and applications at the application layer and physical layer. An application gets developed, it gets orchestrated, it gets distributed across different nodes, and it allows you to find the physical partitioning of that application across various servers. I thought:

That’s kind of interesting. They are making a whack at both trying to model from the application down to the physical layer and think through the physical consequences of application development activities.

Gardner: Another trend in the market is the SaaS approach, where we might acquire more types of services, perhaps on a granular level or wholesale level from Google, Salesforce, Amazon, or Microsoft, in which case they are running their datacenters. We have to assume, because they're on a subscription basis for their economics, that they are going to be highly motivated toward high-utilization, high-efficiency, low-footprint, low-energy consumption.

That will ultimately help the planet, as well, because we wouldn’t have umpteen datacenters in every single company of more than a 150 people. We could start centralizing this almost like a utility would. We would think that these large companies, as they put in these massive datacenters, could have the opportunity for a volume benefit in how they consume and purchase energy.

Gardner: Neil Macehiter, what do you make of this Green-SOA relationship?

Macehiter: We need to step back and look at what we are talking about. You mentioned ROI. If we look at this from a Green ROI perspective, organizations are not going to be looking at SOA as the first step in reducing their Green footprint. It's going to be about server and storage consolidation to reduce the power consumption, provide more efficient cooling, and management approaches to ensure that servers aren’t running when they don’t need to be. That’s going to give them much bigger Green bang for the buck.

Certainly, the ability to reuse and share services is going to have an impact in terms of reducing duplications, but in the broader scheme of things I see that contribution as being comparatively small. The history that we have is largely ignoring the implications of power and heat, until we get to the size of a Google or a Microsoft, where we have to start thinking about putting our datacenters next to large amounts of water, where we can get hydroelectric power.

So, IT has a contribution to make, but there isn't anything explicit in SOA approaches, beyond things like service reuse and sharing that can really contribute. The economies of scale that you get from SaaS in terms of exploiting those services come from more effective use of the datacenter resources. This is those organizations' business, and, given the constraints they operate under, they can’t get datacenters big enough, because then there are no power stations big enough.

Gardner: Your point is well taken. Maybe we're looking at this the wrong way. Maybe we’ve got it backwards. Maybe SOA, in some way, aids and abets Green activities. Maybe it's Green activities, as they consolidate, unify, seek high utilization, and storage, that will aid and abet SOA. As Gartner points out, in their number one strategic technology area for 2008, Green initiatives are going to direct companies in the way that they deploy and use technology towards a situation where they can better avail themselves of SOA principles. Does that sound right, Joe McKendrick?

McKendrick: In an indirect way, it sounds right, but I want to take an even a further step back and look at what we have here. Frankly, the Green IT initiative is misguided and the wrong questions are being asked about Green IT. Let me say that I have been in active environmental causes and I have done consulting work with a company that has worked with utilities and ERP Electric Car Research Institute on energy saving initiatives.

It's great that IT is emphasizing efficient datacenters, but what we need to look at is how much energy IT has saved the world in general? How much power is being saved as a result of IT initiatives? SOA rolls right into this. For example, how many business trips are not being taken now, because of the availability of video conferencing and remote telecommuting, telework and things of that sort? We need studies. I don’t have the data on this and there isn’t any data out there that has really tracked this. In e-commerce, for example, how many stores have not been built because of e-commerce?

Gardner: These are really good points that the overall amount of energy consumption in the world would be much greater and productivity. It's very difficult to put all the cookie crumbs together and precisely measure the inputs and outputs, but that’s not really the point. We're not talking about what we would have saved, if we didn’t have IT for saving. What can we do to refine even further that what which we have to use to create the IT that we have?

Macehiter: The reality is that we can’t offset what we’ve saved in the past against what we are going to conceive in the future. We are at a baseline and it is not about apportioning blame between industries and saying, "Well, IT doesn’t have to do so much, because we’ve done a lot in the past."

McKendrick: But, we are putting demands on IT, Neil. We're putting a lot of demands on IT for additional IT resources.

Macehiter: If you go into a large investment bank, and look at what proportion of their electricity consumption is consumed by IT, I'd hazard a guess that it's a pretty large chunk, alongside facilities.

McKendrick: And probably lots of demands are put on those datacenters, but how much energy is that saving because of additional services being put out to the world, being put out to society?

Gardner: What's your larger point, Joe, that we don’t need to worry too much about making IT more energy efficient because it's already done such a great job compared to the bricks-and-mortar, industrialized past?

McKendrick: The problem is, Dana, we don’t know. There are no studies. I'd love to see studies commissioned. I'd love to see our government or a private foundation fund some studies to find out how much energy IT has been saving us.

Kobielus: I agree with everything you guys are saying, because the issue is not so much reducing IT’s footprint on the environment. It’s reducing our species' overall footprint on the resources. One thing to consider is whether we have more energy-efficient datacenters. Another thing to consider is that, as more functionality gets pushed out to the periphery in terms of PCs and departmental servers, the vast majority of the IT is completely outside the datacenter.

Gardner: Jim, you are really talking about networked IT, so it's really about the Internet, right? The Internet has allowed for a "clicks in e-commerce" and not a "bricks in heavy industries" approach. In that case, we're saying it's good that IT in the Internet has given us the vast economies of scale, productivity, and efficiency, but that also requires a tremendous amount of electricity. So, isn’t this really an argument for safe nuclear and to put small nuclear reactor next to datacenters and perhaps not create CO₂?

Macehiter: Let's not forget that this isn't just about enterprise use of IT. If I look at my desk, as a consumer of IT, I've got a scanner, hard disk, two machines, screen, two wireless routers, and speakers that are all consuming electricity. Ten years ago, I just wouldn’t have had that. So, we have to look broader than the enterprise. We can get into a whole other rat’s nest, if we start into safe nuclear power or having wind farms near our datacenter.

Gardner: It's going to be NOA, that’s Nuclear-Oriented Architecture…

Kobielus: In the Wall Street Journal this morning, there was an article about Daylight Saving Time. This year, in the US, Daylight Saving Time has been moved up by a week at the beginning in March and moved back by a week into November. So, this coming Sunday, we are going to finally let our clocks fall back to so-called Standard Time.

The article said that nobody has really done a study to show whether we are actually saving any energy from Daylight Saving Time? There have been no reliable studies done. So, when the legislatures change these weeks, they're just assuming that, by having more hours of daylight in the evening, we are using less illumination, therefore the net budget or net consumption of energy goes down.

In fact, people have darker mornings, and people tend to have more morning-oriented lives. People in the morning quite often are surfing the Web, and viewing the stuff on their TiVo, etc. So, net net, nobody even knows with Daylight Saving Time whether it's Green friendly, as a concept.

Gardner: Common sense would lead you to believe that you’re just robbing Peter to pay Paul on this one, right? Perhaps there are some lessons to be learned on that same level for IT. We think we're saving footprints in data centers and we are consolidating and unifying, but we are also bringing more people online and they have larger energy-consuming desktop environments or small-office environments that Neil described. If there are 400 million people with small offices and there are a billion people on the Internet, then clearly the growth is far and away outstripping whatever efficiencies we might bring to the table.

McKendrick: The efficiencies gained by IT might be outstripping any concerns about green footprints with datacenters. We need data. We need studies to look at this side of it. The U.S. Congress is talking about studying the energy efficiency of datacenters, and you can imagine some kind of regulations will flow from that.

Kobielus: I'm going to be a cynic and am just going to guess that large, Global 2000 corporations are going to be motivated more by economics than altruism when it comes to the environment. So back to the announcement today, on Nov. 2, about IBM launching an initiative to give corporate customers a way to measure and potentially monetize energy efficient measures in their datacenters.

I think IBM is trying to come up with the currency of sorts, a way to earn energy-efficient certificates that can then apply some kind of an economic incentive and/or metric to this issue. As we discussed earlier, the Green approach to IT might actually augment SOA, because I don’t think SOA leads to Green, but many of the things you do for Green will help people recognize higher value from SOA types of activities.

Gardner: Let's leave it at that. We're out of time. It's been another good discussion. Our two topics today have been the Microsoft SOA conference and abstract relationship between Green IT and SOA. We have been joined with our great thinkers and fantastic contributors here today including Jim Kobielus, principal analyst at Current Analysis. Thanks, Jim.

Kobielus: Thank you, Dana. I enjoyed it as always.

Gardner: Neil Macehiter, principal analyst at Macehiter Ward-Dutton. Thanks, Neil.

Macehiter: Thanks, Dana. Thanks, everyone.

Gardner: And, Joe McKendrick, the independent analyst and blogger extraordinaire. Thanks, Joe.

McKendrick: Thanks, Dana. It was great to be here.

Gardner: This is Dana Gardner, principal analyst at Interarbor Solutions. You’ve been listening to BriefingsDirect SOA Insights Edition, Volume 27. Come back again next time. Thank you.

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Transcript of BriefingsDirect SOA Insights Edition podcast, Vol. 27, on Microsoft SOA and Green IT. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.

BriefingsDirect SOA Insights Analysts on Citrix, XenSource, HP and Opsware

Edited transcript of weekly BriefingsDirect[TM] SOA Insights Edition podcast, recorded August 13, 2007.

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Dana Gardner: Hello, and welcome to the latest BriefingsDirect, SOA Insights Edition, Volume 24, a weekly discussion and dissection of Services Oriented Architecture (SOA) related news and events with a panel of industry analysts and guests.

I’m your host and moderator, Dana Gardner, principal analyst at Interarbor Solutions, and ZDNet blogger. We are joined by a large stable of experts and analysts this week, and this is the week of August 13, 2007. Let me go through our list of contributors. First I would like to welcome Jim Kobielus, principal analyst at Current Analysis.

Jim Kobielus: Good morning, everyone.

Gardner: We are also joined by Neil Macehiter, research director at Macehiter Ward-Dutton in the U.K. Hello, Neil.

Neil Macehiter: Hello, everyone.

Gardner: Making his debut on our show, Dan Kusnetzky, principal analyst and president of the Kusnetzky Group. Hello, Dan.

Dan Kusnetzky: Good day, everyone.

Gardner: A return guest, Brad Shimmin, principal analyst at Current Analysis.

Brad Shimmin: Greetings, everybody.

Gardner: Also, a regular these days, Todd Biske, enterprise architect at Monsanto, formerly with MomentumSI.

Todd Biske: Hi, everybody!

Gardner: And one additional newcomer, JP Morgenthal, CEO of Avorcor. Welcome to the show.

JP Morgenthal: Hello, everyone.

Gardner: And last, but not least, Tony Baer, principal of onStrategies. Thanks for joining, Tony.

Tony Baer: Good morning, Dana and everybody.

Gardner: We want to jump into two major topics this week, and they are both a result of mergers and acquisitions. First, we're going to discuss something that has further highlighted a hot area, virtualization. That is the acquisition by Citrix of XenSource. We're going to look at virtualization as a result of this $500 million deal at a very high multiple. We're going to look at the implications for Microsoft, for open source, and for virtualization in general.

We're also going to step back a few weeks into July and discuss the $1.6-billion acquisition of Opsware by HP. This is a case where we are looking at management, and an acquisition that might help redefine or expand the role of management, automation, and operations, and perhaps have an impact on SOA as well.

First, let's get the low down on the XenSource and Citrix deal. Why don’t you give us a quick recap on that Tony Baer?

Baer: Well, Citrix has made roughly a $500-million offer to buy XenSource, which is itself a company that was formed around commercializing the Xen hypervisor open-source technology. In fact, it only morphed into a real commercial company within the past 12 months or so, maybe even less.

The interesting thing about XenSource is that it’s been considered to be the leading, emerging alternative to VMware. It essentially virtualizes the machine to a slightly more native approach than VMware. It's a very interesting acquisition because Xen has had a relationship with Microsoft, where it gets access to Microsoft's virtualization technology, and it also fills a key gap for Citrix.

Dana, you and several of the other folks here who were on the call raised a lot of questions in terms of how this impacts the relationship between both companies and Microsoft.

My quick take on it is that in the grand scheme of things, it's not going to make huge changes. Of course, there's a lot of wiggle room here, but my sense is that, when all the debris settles, Microsoft will still need some way of interoperating its hypervisor with the Linux environment. So, even though the relationships may change somewhat in the long run, there will still be some sort of technology sharing here.

Gardner: Let's go to Neil Macehiter. The question for you is how big a deal is this really, and is it a game-changing event, given the high multiple?

Macehiter: I'm not sure one can necessarily equate the high multiple with its being a game-changing event. Clearly, XenSource has about $8 million revenues. We think its paid revenue is $20 million next year. So, it's a monstrous multiple, which indicates that virtualization is very hard, as we have seen with the VMware's IPO. They are now the top publicly traded software company in the world, based on market cap. What this acquisition emphasizes, more than anything else, is where the temperature is rising, and it's not in the core hypervisor.

The hypervisor that Citrix has acquired in Xen is actually open source, and the commitment is to retain that as an open-source initiative. The real value in this acquisition is XenEnterprise v4, which addresses some of the lifecycle management issues around virtual machine infrastructure provisioning, image management, etc. That’s where the temperature is already rising, and it was an acknowledged gap in the Citrix portfolio around desktop virtualization. So, I think it is indicative that virtualization management is hard. I must admit I was quite surprised that Citrix was the acquirer. I was thinking that XenSource was an acquisition target, but I was thinking more of the OS providers, the Red Hats or Novells, acquiring the capability, particularly around the management.

The Microsoft relationship isn't game changing, primarily because Microsoft’s hypervisor technology and the management around it, in Viridian and Virtual Machine Manager, is still a year or so away. It's going to be very interesting to see how the relationship morphs, as Microsoft becomes less dependent by virtue of having it's own hypervisor within Windows Server. Microsoft Research in Cambridge, just down the road for me, was involved in some of the early development at Xen, because that came out of Cambridge university.

Gardner: Okay, Dan Kusnetzky, you write the Virtual Man blog on ZDNet, and you have been covering virtualization for a long time. As a former IDC Group head, tell us a little bit about your perspective on this. From what we saw, from quotes out of Citrix, this deal had been under discussion for a long time. The fact that it came within days of the VMware IPO, which had very great reception, doesn’t seem to be related to this. The timing doesn’t seem to be related, and is somewhat of a coincidence. What's your perspective on this virtualization market?

Kusnetzky: First, I want to expand the notion of virtualization, and to point out it's not anything that’s really new. The model of virtualization that I have been using to examine the market includes seven different layers of technology, each moving some part of an application environment from living in a physical world, to move in a logical or virtual world. If we look at Citrix's strengths, they've always played very well in access virtualization, that is, making it possible for an application to display on a remote device without the application having to know a great deal about what the remote device looks like, the network that it's on, or anything.

They've also got some form of application virtualization, allowing applications to be accessed regardless of where they are, what operating systems they're running on, and the like. They’ve never had a very strong processing virtualization, storage virtualization, network virtualization, security story for the virtualized environment, or management of physical and virtual resources.

If we look at just the idea of what XenSource was doing with their processing virtualization management security, particularly their recent announcement of partnership with Symantec for the Veritas Storage Foundation software to be included in XenEnterprise, you could see that Citrix starts to have a more top-to-bottom virtualization story than they every had before. So, from a product portfolio view, this acquisition appears to make some sense.

From another point of view, though, I have some pretty serious doubts. If we look at the history of technology company acquisitions in the past, corporate culture and management style makes a very big difference in retention of key developers, key architects, and key strategists.

We don’t have to look too far to see some pretty major disasters where a big company acquired a smaller company that had a different approach to business and the key designers left. You could look at IBM acquiring Rohm to get into the telecommunications market, and very short order, all of the people who had made Rohm what it was, went to Northern Telecom. Another example would be Computer Associates acquiring Ingress, and the significant designers and architects moving to Sybase and Oracle, leaving CA with a shell of a company.

Gardner: Alright. So, given that there is some inherent risk in mergers and acquisitions generally, there doesn’t seem to be any obvious cultural symmetry or alignment between these two companies.

Kusnetzky: There are even strong differences. Citrix has been married to Microsoft for years, even though it had technology that allowed it to work with Unix, Solaris in particular, and Linux. They really didn’t focus on that because it would anger the folks in Redmond.

Gardner: Right, and they have managed that relationship very well. It’s been something that I was thinking would not last very long, but it has. Nonetheless, so what gives with this deal? If there are these risks, this lack of symmetry culturally, this high multiple, is this a desperation move, and why the big land grab in the case of this virtualization technology?

Kusnetzky: If we look at Citrix's portfolio, every single piece, service, or product offering is matched by something Microsoft is pushing now. That, in essence, means that Microsoft is trying to acquire the business that Citrix has and slowly remove Citrix from the limelight and off to the sidelines.

They have their own presentation services in the form of terminal services. They have their own clustering. They have their own Go-to-Meeting-like software with the acquisition of another company’s business. Go-to-Meeting was Citrix and Live Meeting is Microsoft. If you go down the list, Citrix is being increasingly pushed off into the corner, and they needed to do something that allowed them to come back and be focused. They needed a broader strategy, one that wasn’t focused solely on access mechanisms. The acquisition of XenSource gives them a broader story.

Gardner: Is Citrix drawing a line in the sand and saying finally, "Okay Microsoft, we played this competition thing for a long time. We've been the little sucker fish on the side of the big shark for a long time, but now we're going open source. We are going to use that strategically, and we are going to go off on our own and try to make real hay on this virtualization thing."

Kusnetzky: That is, at least, a possibility. The majority of Citrix's business is centered on Windows, so they can’t go too far along the path of angering Microsoft, because it would become very difficult for them to get access to key technologies that allow their product to work.

Gardner: Let’s look for a little level set with some practitioners in the field. First, Todd Biske, how interesting is virtualization to you as an architect? Is this something you see off in the future? Is this something you look only for operational efficiency or do you see this as something strategic and perhaps related to SOA?

Biske: Virtualization is definitely something that organizations are looking at right now. For the clients I've worked with, it's been a mix. Some are really trying to embrace it on the server side and make use of it right now. Others are looking at possibly using it on the desktop for developers, when they need to get a specific development environment, but it’s definitely in people’s minds today. So, I would definitely classify it as in the list of strategic initiatives that companies are looking at and determining how to use appropriately.

This is a really interesting acquisition that will help XenSource at least get more mind share in the enterprise. Companies obviously have lots of Microsoft investments on all their desktops. There's a good chance that major enterprises have significant investments in Citrix as well, if they've got any need for remote access for their systems, terminal services, etc. It will open it up to a few more environments to add in this virtualization capability for organizations that were still unsure about what to do with open source. It’s a good thing from that perspective.

Gardner: Citrix is in a lot of major accounts, they're well entrenched, they have a sales force, and they have a presence.

Biske: Absolutely. I compare it to IONA’s acquisition of LogicBlaze. For companies that were looking at open source, having IONA behind that was a good thing, because they've now got a strong name, somebody they can go to for the support around that. Now, you've got the same situation with XenSource. When you have these smaller companies trying to commercialize open source, they still haven’t built the reputation of these larger vendors. So, overall for XenSource it’s a good thing. We’ll have to see whether it really enables them to compete even more with VMware and Microsoft’s coming solution in the space.

Gardner: Let’s go to another practitioner. , tell us a little bit about your company and then quickly how you see this virtualization trend appearing in your client base?

Morgenthal: Thanks. Avorcor is delivering what we call the supply chain as a service. We're really involved heavily in a vertical market SOA around supply-chain management. We've been doing a lot with taking SOA and driving it out in a vertical nature, not just horizontal, where I see a lot of the early work being done. Because of what we're doing, we are working with clients who are facing these issues.

I’ll give you an example where the state of art is, where the state of the decision making is. We have a client that is looking to make a very large enterprise application decision. The company from which they're buying their enterprise application software refuses to commit to virtualization or running on a virtualization architecture. Even though there has been significant evidence of enhanced performance that are running natively on a flat Windows platform in a virtual machine, this company would not commit to running in production in a virtualized architecture. On the other hand, we find that we’d perform better in a virtualized architecture.

We've been dealing with issues of the Microsoft platform for a long time around resource management, where we're fighting with SQL server and other applications or resources, and each one has different memory requirements. This virtualized environment allows us to focus on giving our application 100 percent of the resources, and thereby never running out of things like TCP/IP sockets or having memory thrashing errors slowing down wireless communications, which is critical to Web services doing their job. So, it’s having a profound effect on the production environment.

Gardner: Is virtualization making the operations and architects an offer that they can’t refuse, and is Microsoft going to have to adjust to this reality?

Morgenthal: From a development perspective, that's a given. I, myself, have done what no one expected. I'm actually running on a Macintosh, and that's because I run all my development from my Windows platform stuff in a parallel virtual machine. The reason I do that is because the the MacBook Pro is one of the best Intel machines on the market today. It’s solid. It’s stable. The applications and everything else I do using the Web in my job, run perfectly in that environment, and when I need to do development. So, from a development perspective, it’s a given that people are moving in this direction in busloads.

Gardner: How about the datacenter side?

Morgenthal: On the datacenter side, the promise there is better utilization of resources. As I said, if you really want to get into it, you could find a way to tune Microsoft, but I have a sys admin working in one of my clients who is fighting with this 3GB initialization parameter. When he puts it in one way, one app gets hit when he puts in there. When he doesn’t put it in, other apps get hit, but mine works fine.

This is a clear case of where you go out and get an additional operating system license and put this into each application and in its own VM running on a four-way or eight-way Intel Duo Core 2 machine -- they are running an SAN -- and you have one of the cleanest, most high performing environments I've ever seen.

Gardner: Let's go to Brad Shimmin. Brad, were talking now about the big issue: the high cost of ongoing operations and the interdependency between applications and services within an infrastructure. What’s your take on this virtualization opportunity? Is this really going to be a matter of economics pure and simple?

Shimmin: Absolutely, it's a matter of economics, but not just for the reasons we were talking about. We were mentioning that this is something that helps you better utilize your hardware. This lets you better utilize your software. It basically frees you from having to worry about the stack and the interoperability issues that arise over time in managing a stack.

Gardner: If I can just pause you there and stay on what you just said. SOA is, in effect, heightening this issue, because of the need for discrete services running with their own horses and their own power. What do you think is the relationship between the emergence of virtualization and the accelerating effect that SOA is playing?

Shimmin: You're right there, Dana. There are two levels where this really takes effect. One is, as you were just describing, on a broader level, you need to have interoperability. That interoperability is something that is multilayered and something that you need to be able to standardize over time in a SOA infrastructure and virtualization, once you abstract away all those things that mitigate your ability to do so.

On a more finite level, the part that interests me is the fact that, when you set up a SOA installation, you have a lot of issues you have to resolve initially in terms of, "I'm going to have this version of the operating system, and this version of application server, and this version of USB up the stack."

As we've seen a lot of the vendors, Red Hat and now Novell with their agreement with IBM this week, are trying to say, "Okay, look, we are going to, standardize the stack for you. We're going to tell you that it's definitely something you can count on over time. It's not going to break every time we version a piece of it." What virtualization does is let you set up that verified stack on your server and not have to worry about breaking it down the road, because it's sitting in it's own virtual environment.

Gardner: And doesn’t virtualization also allow you, if you're have a Microsoft shop or you have a lot of Microsoft applications running, to continue to exploit and leverage those investments, but extend them, and without an additional high cost on the infrastructure side of it?

Shimmin: Absolutely. Your lifespan for software is dramatically increased by virtualizing it.

Gardner: Alright. Jim Kobielus, what are we missing here? Is there something that we are not addressing in terms of the impact of 1) this deal, 2) the emphasis that’s placed or the spotlight it's placed on virtualization, and then, 3), how does virtualization affect Microsoft going forward?

Kobielus: I don’t know if we're missing it, but may just overlooking the fact that virtualization is hot this week. Clearly, there have been very important announcements, both XenSource with v4 of its product, the IPO by VMware, and, of course, the acquisition of XenSource by Citrix. That’s hot this week, but really SOA is a virtualization approach.

Virtualization is a long-stroke perspective, as is any approach that further decouples the application logic from the underlying metal. That’s what SOA is all about. Another way of putting that is, abstracting the external calling interface from the underlying implementation of a service or set of services. Virtualization has been around since the dawn of computing. When we stopped programming in machine code and started using FORTRAN, COBOL, as well as compilers and so forth, to put greater distance between the logic and the metal, that’s when virtualization, as an approach, began. It was the big bang of the 1950s and 1960s in computing.

So, in a sense, virtualization is like a cosmic background radiation that still radiates and still manifests itself in complex ways, including, of course, this new focus, this recent focus on hypervisors and so forth.

Cycling back to the importance of this week’s events from Microsoft, what happened this week is good for all three major players. It's good for XenSource, Citrix, and Microsoft. Clearly, it's good for XenSource, because, they've got a tough challenge. They're in a market where their primary competitor, VMware, currently has 85 percent of the market for server virtualization. So, XenSource needed its own mini big bang to give it further momentum to overtake VMware/EMC fairly soon.

Citrix is much larger, more deeply capitalized, richer in R&D and has extensive global sales and marketing, and is a logical suitor for XenSource. It's good for Citrix, because Citrix has several people who have been in the access and presentation of virtualization space for quite some while, and it's well entrenched as a Microsoft partner. So, this allows Citrix, by acquiring XenSource, to put together a complete end-to-end virtualization platform, from storage to processor, to server and access virtualization -- the whole soup to nuts.

Gardner: What about this notion of desktop as a service, where you are not just delivering, as Citrix has done, application interfaces? We're not just talking about the back end, where we are virtualizing instances of a runtime environment, operating system, or stack, but are talking about delivering to end users, the essential ingredients of a operating system desktop with all the associated services and applications that come down in that environment. That's something that might be of great interest to your cable company or telco or someone who is working towards software as a service, but wants to expand on that in to a fuller environment subscription based business model. Does this set Citrix up to move in that direction?

Kobielus: Oh, sure. They've been moving in that direction, of course -- thin-client application virtualization and a multi-client environment focused on mobility. It definitely positions them better. Citrix acquired NetScaler, a year or two ago, and they've got their own MetaFrame Technology. I'm hoping that they will then unify or de-siloize their various virtualization product Citrix upon Xen as their dominant hypervisor, without losing any connectivity or interoperability with Microsoft, on both the access side and on Viridian, as Viridian gets built up.

One of the most powerful things is that Citrix is now the bridge, virtualization-wise, with the open-source community. Clearly, Xen has great traction with Red Hat, Linux SuSE, and, of course, Microsoft, because they have been Microsoft’s primary access virtualization partner for quite sometime.

I want to close the loop on your question, Dana. The XenSource acquisition by Citrix is good for Microsoft, because it allows Microsoft to buy some time until Viridian is ready. A year from now, Microsoft can say, “Oh yeah, we don’t have Viridian ready just yet, but look at this. Two of our primary virtualization partners have gotten together to field an ever more comprehensive virtualization product portfolio, which is integrated or will be integrated fairly tightly with Viridian when that comes out."

So, we'll hear Microsoft saying, “We don’t have it all together today, but we have partners who can give you a fuller virtualization portfolio to compete with EMC/VMware."

Gardner: Hold on. What you're saying is that Microsoft is saying, “We will let our partners go out and to get the beachhead on this business, compete against VMware in the short-term, but then we'll come up and take the whole thing later."

Kobielus: Right. I was surprised that we haven’t seen Microsoft acquire Citrix outright.

Gardner: There's another thing I've seen on the blogosphere is people saying, “This sets Citrix up to be an acquisition target.” It might explain why they went for such a high multiple. They think they can recover some of that from perhaps an acquisition from Microsoft, HP, or maybe even IBM.

Macehiter: Can I just chip in one quick thing here?

Gardner: Certainly. Go ahead.

Macehiter: One interesting element of the acquisition is that historically XenSource has been primarily focused on virtualization in the server infrastructural environment. Citrix has historically focused on virtual desktop, and VMware had it's VDI initiative around that. One question about this is the extent to which the Xen capabilities are harnessed by Citrix to address some limitations of the virtual desktop infrastructure environment, in terms of an integration with things like the Citrix Desktop Server. That becomes the primary focus in terms of offering a virtual desktop infrastructure, the expense of the core backend server infrastructure virtualization.

There's an interesting dynamic there. Although, in principle, they have the soup-to-nuts solution, the question is whether they bundle this as a core capability, which means that they are primarily focusing on virtual desktop, versus virtualization across the page. A key issue is the scalability limitations around things like presentation server, where you just see organizations throwing in more and more servers just to deliver the scalability of presentation server.

Gardner: Let's go back to Tony Baer. Obviously, it's a very complex acquisition in terms of its implications. I think we're still wondering. There's a lot of mud in the water. Microsoft can play this in a number of different ways. Tony, do you have a contrarian view about whether this is good or bad for Microsoft?

Baer: I've also been monitoring a bunch of the blogs, one of the more interesting cases that I have seen is that -- and which actually makes some sense -- is that Citrix is not, at its base, an open-source company. As Dan was talking about before, there are some cultural challenges there. XenSource was an academic project at Cambridge, and was then spun off into a non-rofit foundation like the Eclipse.

That would clear the way for Microsoft to pursue an acquisition here, and make for a nice clean break. I don’t know if that answers your questions, Dana. but my sense here is that this might actually smooth some rough edges around the challenges Microsoft has had in developing Viridian.

Gardner: So, you think that they would maintain a close relationship with Citrix, start begging off some of the technology from the open-source community around XenSource, and use that to bolster its entry into the market, particularly to compete against VMware.

Baer: If you have that clean break, where the open-source stuff is taken care by an outside foundation, that could set some sort of precedent from Microsoft, because Microsoft had been making some initiatives towards the open-source community in the area of interoperability.

Gardner: Microsoft is the only major software company in the world that doesn’t have an open-source benefit that helps it with its R&D, helps it in terms of its entry to market, or it gets community to help it develop around the edges of commercial products. That’s not sustainable, is it?

Baer: Not in the long run, but my sense is that, what Microsoft is trying to do in sort of a life-extension mode is organize these interoperability agreements with folks like JBoss. That type of precedent could happen here with the Xen Technology, and if XenSource under Citrix divests the technology and it's absorbed into an open-source foundation, that would clear the way for Microsoft to open up a much closer relationship with Citrix. Ultimately, Microsoft could acquire them, if Viridian is further down the pike that they think.

Microsoft has had challenges developing this technology over the past few years, and Microsoft hasn't been reluctant in the past to acquire technology. The only thing that might be a game changer is that Microsoft tends to acquire small start-up companies, and Citrix wouldn't fit that mold. But, this does open up some possibilities.

Gardner: Todd Biske, as a practitioner in the field, you're dealing with a lot of environments where there's Windows. There are application costs that are increasing and there’s complexity around SOA creating the need for automation. Do you think that this deal for a buyer in an enterprise makes any sense, and how would it help them?

Biske: If you start getting into the automation space, the HP-Opsware deal is obviously the more interesting one. There's a natural connection between the virtualization space and some of the movements in the management space. Your panel here discussed SOA and virtualization almost a year ago, and I have some comments on my blog about it.

When you really embrace SOA, you're going to wind up with more moving parts for a given solution. And in doing so, you could create this management challenge of how to allocate resources for each of these individual services that have their own life cycle. There's a natural potential to move towards server virtualization to do that, so you can get your arms around that whole management concept. Where I've been disappointed in the management space, however, was that we really haven’t seen anything from the large systems management vendors to start tackling this problem.

Gardner: That’s a great segue, and let's go right into the next subject. We found that SOA will have an accelerating effect on the need for, or the pursuit of, virtualization benefits. The same can probably be said for management, but management is, like virtualization, a large and nebulous topic that encompasses many different things. We’ve talked a lot on this show about the governance and design-time management issues, but how do we start looking towards some automation on the operations side to create some kind of a feedback-loop opportunity for services, how they are used, how they are provisioned, and how they are governed?

So, to this Opsware deal. Opsware was founded and created by Marc Andreessen of Netscape fame. It had an interesting see-saw ride in terms of its market capitalization and then the dot-com boom and bust, hung on through the tough times, and now has been acquired by Hewlett-Packard. Tell us again with a little bit more depth, if you would, Todd, how you see management on the operations side and SOA relating?

Biske: What's most interesting for me is applying SOA to the management space. So, if we are creating lots and lots of services -- you may now have 500 or 1,000 services -- you have to look at that and say, "I have a bigger management problem." There's no reason we can’t take the concepts of SOA and apply them to the management environment.

So, whether it's automated provisioning of solutions, automated policy management, a need to change SOA’s or enable more resources for a particular consumer, there is no reason that I shouldn’t be able to have my management systems call a service to do that. I may want to set up custom orchestrations for how to manage my infrastructure. I may want it all automated out of the box and just push a switch and have it happen.

In order to get there, we've got to have management services on all of our infrastructure, and that’s where there's a huge gap. Everything is still intended to be used by a person. Maybe with some creative scripting, people are able to do it, but you can compare it to the days of Web-enabling mainframes, where the technique was to screen scrape off the green screens. You almost have to do the same thing from the management side now. Look at these user-facing consoles, figure out what glue you can put in front of it to script it, and automate it.

Gardner: Let's go to Brad Shimmin. Brad, are we in an area here where we've got management integration pains, and is HP in a position through acquisitions in it's OpenView legacy to help solve some of that?

Shimmin: They're absolutely in a position to help us with this, both from what Todd was just saying there, and the inverse of what Todd was saying, which I want to talk about, but they have the products and the technologies. The Systinet acquisition that I think is the linchpin here for making this all work together. As you were saying, we’ve seen precious little come out of them and others in the space. The real go-getter here for me is the opposite of what Todd was saying. I would want to see my SOA installations able to speak to and hear from my datacenter systems management solutions. And right now, for that closed loop you were talking about, everything we see is the basic SNMP traps that may get read by Tivoli’s program.

That lets you say, "Okay, there is an alert that one of my servers is overrun on memory. I’ve got these applications running on it, I am going to need to do something, and I see an alert that I can drill down on, and do some basic root-cause analysis." That’s not enough for a true business technology optimization and being able to utilize the resources you are trying to marshal for a SOA environment. I want my Tivoli Application Manager to fully automate that process, look at the variables and the event stream coming from my systems, correlate that, and put it into some sort of context with my applications that are running on it.

Gardner: Morgenthal, in some of the installations that you’ve been working with on SOA, has management already become an issue? That's to say, it’s hard to factor what’s running where and how, and getting a holistic view is next to impossible.

Morgenthal: I had a conversation with Paul Preiss, who heads up IASA, the International Association of Software Architects, about this very thing. He has raised a point and is trying to drive attention towards the exponential growth of SOA, as people start to add services and services become dependent upon services and organizations. I don’t see that problem. One of the differences is that when you come at it from an enterprise IT perspective, and when you come at it from a product perspective, you end up with two different SOAs.

From a product perspective, when you deliver a product as a SOA, you're delivering the architecture, and then you are delivering the implementation of that architecture. Therefore, you have a very controlled instance in which you can manage very easily without needing large governance controls, because you're providing all the infrastructure for management of that SOA as part of your application.

Yes, when you have a lot of legacy infrastructure and legacy investment, and people without the sophisticated SOA architecture experience on staff start developing services, you open yourself up for potential disaster. In those instances, the organization has to ask itself, "Are we ready to invest here?" Every organization obviously wants to take advantage of the latest technologies. This is one of them that can really end up biting them if they are not careful.

So, they need to step back and think about what it takes to invest in SOA and start to wrap their legacy systems and make them available. For one client I worked with -- I love to tell the story, it’s hysterical to me -- we went in, did a big installation, and they knew nothing about Web services. We introduced a lot of the organization to what the Web services can do. Before we knew it, there was a line out the door: "Can I have a Web service. Can I have a Web service?" We had opened up doors to data that had been previously locked tight and made it very difficult for them to do their jobs.

I told the CIO, "You have to think about a security architecture around this," and he agreed. I came back three months later to do a follow-up meeting with him, and I said, "What did you end up choosing?" And they hadn’t. And this is an environment where they don’t even allow you out to your Yahoo Mail. Every Website is locked down tight, but anybody with a notepad, and knows how to write an XML document, can now get whatever data they want out of the mainframe.

So, you see what’s happening. Governance is at the point already where you have a consolidated approach. Prior to that, you need a plan, you need a well thought out approach to what it means to invest in this type of technology and architecture.

Gardner: Neil Macehiter, it looks as if HP is drawing some lines between governance and operational management. Clearly, they’ve got a lot that they can pull together to pull off something like that. In your thinking, is governance more important or is management something we need to address in the context of governance? How does management governance SOA fit in your thinking?

Macehiter: I take a slightly different perspective on the distinction between governance and systems management. I actually think it’s a continuum. Governance is about the way you manage the entire service lifecycle. Historically, there has been this distinction between the governance of design-time processes and the design and development of application solutions, and the governance of the operational environment. Primarily, that’s been because applications have been developed and thrown over the wall.

As we move toward more of a service-oriented approach, the service actually becomes a common element that spans development and operations. That’s one of the key benefits of a service-oriented approach. The implication of that is that you can’t make these broad distinctions. There needs to be continuum. And that’s where things like the registry and the repository become key, because they contain and manage the artifacts that can provide that linkage in terms of things like contracts, and then policies.

There has to be more of a joined perspective. HP, in principle, through its acquisitions, has the assets. For example, when they acquired Talking Blocks that was one the early Web services management players that had assets around management of Web services. Now, they're using it to manage their infrastructure, using Web services. But the Systinet acquisition was part Mercury, which is primarily focused on the design-time. HP really needs to join this up. The other issue is around granularity. When a lot of the management vendors talk about managing a SOA, they're really talking about managing the service-oriented infrastructure, rather than managing the services themselves. So, there is a granularity issue.

Opsware is very good at automating provisioning in the lifecycle, but it’s around the infrastructure that’s running the services, not the services themselves. That’s where the linkage needs to come. I tend to share Todd's views. The vendors in the space -- the BMCs, IBMs, HPs, all of them -- have really missed this, and they’ve been lacking in explaining how they're really going to manage the services, because they're so fine-grained. Historically, managing an instance of an SAP application server is very coarse-grained, and that’s comparatively straightforward. But, when you're talking about disaggregating that and having application components everywhere, you have to disaggregate the way you manage as well.

Gardner: It's a much more complex situation. Tony Baer, in the past, we’ve seen two different directions, when we were looking for a continuum-type benefit. If we're looking for a management and governance benefit around SOA implementations, it seems we can go with one big honking vendor who can do all of this. There are probably only a handful of those. Or, we can look toward standards, and such that many different parts can play together and create a solution approach.

It seems like we’re missing not only, as Neil pointed out, a vendor to step up to the plate and solve this on their own, but we are also certainly missing a management-standards approach that would allow a solution-based, ecology-based, or even an open-source based approach. What do you make of that?

Baer: There’s no question about that. Part of the problem is that at that level, when you start dealing with questions of what defines a service level and a service-level compliance and that starts to get into some higher level areas. When you look at the history of standards, the OSI stack is probably a great example of this with the seven layers. I may get my numbers wrong here, but it was relatively easy to standardize Layers 1 through 4, but when you got to layers 5, 6, or 7, where you get close to the application layer, it gets a lot closer to a lot of the assets that vendors consider to be their value adds.

So, I wouldn’t hold my breath waiting for standards. I have always been concerned about what I wrote about a couple of years back as sort of a blood-brain barrier, which is that you had this conception of runtime governance of SOA, then you had this idea of runtime management, which is essentially more of an infrastructure area. They're handled by two different constituencies, one area being handled by datacenter operators and sys admins, and the other area being handled more by the application folks.

So, when I speak with the AmberPoints of the world they say, "Well, what we deal at service level, we're just dealing with it more in terms of tracking -- is the service level maintained -- but we are not going back to the root cause, which is that a particular data server goes down or something like that." There’s just a huge gap there. I was very disappointed with HP, after they acquired Talking Blocks. I never saw much action there in terms of trying to bring that more into what was then OpenView.

HP has a golden opportunity right now, especially with the way they’ve been running HP software. They reversed the acquisition, where they buy Mercury and then put most of the Mercury execs in charge of strategy, which is a brilliant move. They never had much strategy there before that, but they also were taking management to a much higher level. They need to do provide that sort of unity there. That way that you can get a pass-through, so that, for example, when Mercury Quality Center is recording a problem with the design time, that can trigger a test.

Another area is what I would call IT process automation, which traditionally has been called "run book automation." You might recall Opsware had acquired this company called iConclude, which had that type of product that allows you to automate the workflow of running the data center. This is another way of looking at it. You could call that workflow as a service, and that’s something that is an incredibly open opportunity.

Gardner: And, interestingly, will probably play a huge rule in virtualization, if that scales out.

Baer: Exactly, The other thing that Brad and Neil referred to is the whole idea of governance and governance as a lifecycle. It’s not synonymous with systems management, because that’s just an instance of runtime. There’s the whole design time, change time, and retirement time.

Again, there's a huge possibility for the HPs of the world to knit together a nice federated solution here. There are a lot of opportunities that vendors have not exploited so far, where we could finally start to make runtime governance a real actionable component, as opposed to something in which I just look at a dashboard and then get on the phone to my systems operator.

Gardner: Okay. I hope we haven’t presented more questions than we’ve answered today, but clearly two areas that need a lot of attention over the coming months and years are virtualization and how SOA is a catalyst towards a deeper use of virtualization and more economic benefits from virtualization, and, on the other hand, management, how it relates to governance and how SOA will accelerate the need for more of this continuum benefit. Management on the operations side, governance, services, orchestration, infrastructure of services all need to somehow be manageable.

I’d like to thank our panel for joining. These are topics I’m sure we will be revisiting. We’ve had great insight today from Jim Kobielus, principal analyst of Current Analysis; Neil Macehiter, research director at Macehiter Ward-Dutton; Dan Kusnetzky, principal analyst and president of Kusnetzky Group; Brad Shimmin, principal analyst at Current Analysis; Todd Biske, enterprise architect at MomentumSI; Morgenthal, CEO of Avorcor and Tony Baer, principal at OnStrategies.

I'm Dana Gardner, principal analyst at Interarbor Solutions. Thanks for joining. Come back next time.

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Transcript of BriefingsDirect SOA Insights Edition podcast, Vol. 24, on industry mergers and acquisitions. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.