I had the opportunity to attend IBM InterConnect in Las Vegas this week. The conference was very well attended with over 25k attendees, over 40% being first time attendees. That number has to be taken with a grain of salt, as the conference itself is new – combining the former IBM conferences called Pulse, Impact and Innovate. And while the event was spread out over the MGM and the Mandalay Bay conference centers, with frequent shuttle services, walks and related complaints, it makes sense to combine these events. Anyone complaining about the ‘commute’ should consider going to Las Vegas / Orlando for another combined 4-6 days, which effort wise makes the short commute on the Las Vegas Strip a worthwhile and easy endeavor.

In contrast to last year’s events, there were no major announcements – e.g. BlueMix was launched a year ago, but we saw a number of medium size announcements, which all point towards steady progress. And that IBM is staying the course, something the vendor would not do if they would not see good traction with prospects and customers.

So here are my top 3 takeaways (my Day #1 Keynote takeaways are here):

  • The products gets ready for the hybrid cloud – In hindsight it became clear to me that 2014 was all setup by IBM to show that the vendor understood cloud, was ready for it and a player in the public cloud game. With that established, barbs traded with Amazon, IBM can now pivot to where both business and expertise are – in the combination and co-existence of both on premise and cloud assets for its customers. In short the hybrid cloud scenario. More specifically this means that new code needs to run on premise, and as new code is built with BlueMix, it means BlueMix needs to run on premise. And that is exactly what IBM unveiled with BlueMix Local. BlueMix Local enables customers to deploy BlueMix on local hardware, with IBM taking over the maintenance of the environment from a product code support perspective. More specifically this means that IBM will upgrade all BlueMix Local instances for the customer, in synch with BlueMix cloud releases. Or maybe a few days later. Cloud Purists will be shocked, but customers are likely to see value, e.g. in regulated industries, government, cloud sceptic and high latency geographies. Once you have the infrastructure to propagate and install code like this, it is also easy to create dedicated managed instances of BlueMix, something IBM calls BlueMix Dedicated and has signed a first partnership on this with Indian SI Tech Mahindra.

LeBlanc kicks of with Airbus
  • The Organization gets ready for hybrid cloud – To enable the better support for hybrid cloud, IBM has re-organized its development organizations, pretty fundamentally. When a software vendor supports hybrid deployments, it can no longer align product organizations along deployment paths. Inevitably, the development organizations shifts into a matrix modus operandi, with assets being re-used in multiple product or deployment options. When the vendor, like IBM needs to execute a push in a certain direction (here cloud), it means that dotted reporting lines need to be created in the development organization. As such IBM has likely just done the most significant re-organization of its development organization. Speaking with IBM veterans the last similar re-organization of that scale was when IBM created the software group itself. More remarkably the newly created very large product teams have also gone new ways (for IBM) to organize themselves – one of the largest one opting for a functional organization with a centralized product management lead for the complete team. It’s good to see IBM taking bold steps to address the product development organization to align with what the vendor wants (and needs) to deliver to prospects and customers.
    Does it matter how vendors are organized in their product development organizations? Certainly, as software is still build by people and understanding as prospect, customer or ecosystem player how e.g. IBM is organized is important to understand when trying to predict future success, software quality and overall organizational agility.
Hybrid Cloud is the way forward
  • BlueMix is the Future – As mentioned above, BlueMix is the PaaS but also the 21st century Rational for IBM, running on premise with the announcement of BlueMix Local. BlueMix is the way how IBM wants customers and developers to build applications, regardless of the deployment and operational model. While BlueMix is based on Pivotal CloudFoundry, it was interesting to see how IBM executives kept stressing how much more IBM had to create around CloudFoundry to make it work for the IBM purposes. And while in the past CloudFoundry was the one and only deployment option, with InterConnect it was clear that IBM considers CloudFoundry only as one of three deployment options, as BlueMix applications can be delivered to run on OpenStack as well as container (Docker – what else) environments. Considering BlueMix is not even one year old (it was launched February 28th 2014) it has made massive progress. A year ago IBM needed partners like Twilio to show standard orientation, partner openness and cool tools, as the vendor had very little functionality / services compared to today… Today BlueMix has over 50 services, and they are not lightweight, but real and key components to build a next generation application.
    3 User Categories

    So let’s look at the key BlueMix additions beyond Local / Dedicated (see above and the press release here):
  • Container support – BlueMix goes the trend of time, but not without IBM making the containers ‘enterprise grade’ and containers deployable in a hybrid way.
  • DataWorks comes to BlueMix – Originally a new development from the former InfoSphere family, DataWorks was everywhere with its capabilities to make sense, transform and combine data value added services. Something a PaaS needs, and IBM did well leveraging this asset.
  • Collaborative Operations – With this IBM refers to the management tools for hybrid environments, a logical consequence from supporting hybrid.
  • Orchestration – Vendors that support hybrid deployments create an orchestration problem, and IBM does well addressing that.
  • Security – Always a potential concern and IBM is bringing its security assets to BlueMix, powered by analytics that predict threats and vulnerabilities.
  • Secure Passport Services – When enabling hybrid operations, another set of security issues is introduced, using the passport concept to regulate what users are allowed and now allowed to do is a key consequence of supporting hybrid.
  • API Harmony – No conference without API management these days and IBM is adding this service to BlueMix, too.
  • Watson Zone – Watson brings a significant attraction and differentiation to BlueMix and IBM is shrewd at leveraging this capability in the new BlueMix Watson zone.

So overall good progress with BlueMix, which has focused IBM’s effort more than any development platforms of the last years. The bigger work that is happening behind the scenes is that IBM is working hard to realize the vision it laid out almost two years ago, with the API economy direction. And while BlueMix can consume existing and create next generation application APIs, IBM still needs to make APIs available for its 100+ product SaaS portfolio. And the code and deployment behind these applications needs to become more elastic to allow for cost efficient operations. Moreover IBM is active at signing up data provider partnerships, though it has stopped short of declaring that it is in the DaaS (Data as a Service) game (maybe we see at Insights 2015?).


Analyst Tidbits

  • Has Watson stalled? In contrast to Insights 2014 we saw only little progress on the Watson side. And maybe the InterConnect dates came at a bad timing for the product, but it was disappointing to see the same partners and customer on stage at InterConnect as at Insights. And an exclusive Healthcare focus as in the keynote does not do a good service to the potential of Watson, something that was corrected in more detail sessions, but you only have one chance to make a keynote impression. More Watson APIs and Services in BlueMix is certainly the right direction, as it helps Watson adoption and gives BlueMix a unique differentiator in the PaaS market. And maybe we analysts just have too high expectations for Watson, the engineering challenges behind Watson are certainly not trivial.
Watson at MD Anderson Cancer Center
  •  IBM Design is on track for its massive objective – It is around 2 years that IBM has started a push into the design space. The vendor has raised its profile in the creative and design community that is taking note of new developments like the IBM Design Language and a massive hiring drive. Like all vendors IBM has to address the challenge to move 100s of products and development teams and it has opted into a central hiring and training model that later embeds the designers with the product teams. It was good to see what thought has been put into putting designers into the right locations, work environment and review processes. In the past many UI initiatives at many vendors have fizzled, faced with the sheer enormous task. But the ongoing IBM effort is roughly 1/3 on the way in terms of product team reach, and the first results are encouraging.
SoftLayer expanding global footprint
  • SoftLayer keeps plowing on – IBM announced new recent locations, as usual and seems to be on track for the declared 48 locations by end of 2015. When IBM finds something that works for its customers, it puts its weight behind it, and SoftLayer is a great showcase for that. The need for finding load remains and IBM keeps signing up large deals, but by mid-year it will really be time for a load check on how much runs in SoftLayer across the world. The addition of Power and Watson services will certainly help, with Watson IBM has the option to create a unique environment to operate cognitive (aka performance sensitive and potentially data sensitive applications) applications more locally around the world than any competitor. And the addition of container support in BlueMix allows for the operation of unique applications where the code comes to the data, not the classic model of the data having to find the code.
Tables + Power = Happy Analysts!


A good event for IBM, as with all first time conferences attendees struggle with change, but bringing three conferences together is the right step in my opinion. There is too much overlap between the constituents of line of business, IT and developers on the product side not to have these groups together – they need to work as a team in their day to day jobs at enterprises anyway. Sending them to separate events is counterintuitive and counterproductive to a certain point. Now IBM needs to work on a format to make each constituent group happy and engaged at the event. Developers remains the smallest group attending from my observations. I am not sure if IBM has fully tapped into the large rational developer base yet and needs to find ways to tap more into the large developer pools out there.

On the product side we did not see major, major announcements like in 2014 (BlueMix, Watson GA, Marketplace etc.) – but that is a good sign, as IBM focusses on creating additional value for customers and taking customers live. Apart from new concerns around Watson progress it is encouraging to see how fast IBM is moving in the last quarters.

On the bigger picture IBM needs to use the time as traditional (hardware) competitors have not become fully operational in their cloud business. When those competitors find their stride it will be interesting how much of a lead IBM has been able to create and how much traction it has established in the coveted enterprise market. Stay tuned. 
Check out my colleagues takeway - they defintively beat me in video (Ray - here) and pictures (Alan - here).
More on IBM :
  • First Take - IBM InterConnect Day #1 Keynote - BlueMix, SoftLayer and Watson - read here
  • News Analysis - IBM had a very good year in the cloud - 2015 will be key - read here
  • Event Report - IBM Insight 2014 - Is it all coming together for IBM in 2015? Or not? 
  • First Take - Top 3 Takeaways from IBM Insight Day 1 Keynote - read here
  • IBM and SAP partner for cloud - good move - read here
  • Event Report - IBM Enterprise - A lot of value for existing customers, but can IBM attract net new customers? Read here
  • Progress Report - The Mainframe is alive and kicking - but there is more in IBM STG - read here
  • News Analysis - IBM and Intel partner to make the cloud more secure - read here
  • Progress Report - IBM BigData an Analytics have a lot of potential - time to show it - read here
  • Event Report - What a difference a year makes - and off to a good start - read here
  • First Take - 3 Key Takeaways from IBM's Impact Conference - Day 1 Keynote - read here
  • Another week and another Billion - this week it's a BlueMix Paas - read here
  • First take - IBM makes Connection - introduces the TalentSuite at IBM Connect - read here
  • IBM kicks of cloud data center race in 2014 - read here
  • First Take - IBM Software Group's Analyst Insights - read here
  • Are we witnessing one of the largest cloud moves - so far? Read here
  • Why IBM acquired Softlayer - read here
Find more coverage on the Constellation Research website here.
2012, 2013, 2014 & 2015 (C) Holger Mueller - All Rights Reserved