Smarter Computing. Erich Amrehn Distinguished Engineer Chief Architect Smarter Computing technical enablement IBM Corporation

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1 Smarter Computing Erich Amrehn Distinguished Engineer Chief Architect Smarter Computing technical enablement 2011 IBM Corporation

2 Smarter computing HAS BEGUN!

3 We Are Seeing Dramatic Shifts

4 Three years ago we started describing the Smarter Planet we saw emerging, fueling innovation across industries. Neonatal Care Law Enforcement Telecom Fraud Prevention Resource Management Traffic Control Manufacturing Trading

5 Smarter Planet Solutions Increase Demands on IT 1.2 zettabytes (1.2 trillion gigabytes) exist in the digital universe 50% YTY growth 25% of data is unique; 75% is a copy 32.6 million servers worldwide 85% idle computer capacity 15% of servers run 24/7 without being actively used on a daily basis Data centers have doubled their energy use in the past five years 18% increase in data center energy costs projected Internet connected devices growing 42% per year Between 2000 and 2010 servers grew 6x storage grew 69x Virtual machines growing 42% per year But IT budgets are growing less than 0.8% per year

6 IBM Confidential: For internal training purposes only This has created an IT conundrum meeting exploding demand for service on a flat budget. Incomplete, Untrusted Data: Always Guessing Decisions are made on incomplete data, big ideas are seen as risky, and small decisions aren t optimized. Sprawling IT: More Cost Every IT investment leads to more sprawl which drives up infrastructure and management costs. Inflexible IT: Reactive Inflexibility of infrastructure limits integration across silos and responsiveness to customer demands IBM Corporation

7 Resulting Sprawl Drives Unsustainable Costs Cost to Manage Growth of Inventory Consumes IT Budget

8 Meeting These Challenges Leading clients are already addressing this IT conundrum through SMARTER COMPUTING Strategies to Transform IT to Deliver Breakthrough Economics and Value

9 IBM Confidential: For internal training purposes only Smarter Computing is an IT infrastructure that is designed for data, tuned to the task and managed in the cloud. Tuned to the task: Optimized Systems Remove financial barriers by driving greater performance and efficiency for each workload. Managed in the Cloud: Cloud Remove barriers to rapid delivery of new services and reinvent business processes to drive innovation. Designed for data: Big Data Remove barriers to harnessing all available information and unlock insights to make informed choices IBM Corporation

10 Smarter Computing 1. What is Smarter Computing 2. Smarter Computing delivering IT Economics 3. Smarter Computing Base Building Blocks Cloud Computing Optimized Systems Big Data 14

11 As a result, IT is transforming and entering a new phase in Computing Centralized Computing Distributed Computing Networked Computing Smarter Computing ~2010 ~2011 Adoption of mainframe computing Automated, frequent, standardized transactions E.g. government benefit payments Adoption of Personal Computing Moved computing to white collar workers E.g. prepare reports, sales, marketing, strategy Adoption of Internet based computing Drove process automation E.g. business process reengineering, ERP, CRM Adoption of new service delivery models like Cloud Drive business agility E.g. reengineering of data center and connected infrastructure High-Frequency Transactions Individual Transactions Key Business Processes Entire IT Infrastructure 15

12 Smarter Computing The Vision Why We see shifts in IT that signal a New Era of Computing. We call it Smarter Computing. The new era is driven by: Access from attached workstations to ubiquitous smart devices Application from core business applications to real-time insight for the individual Architecture - from heterogeneous silos to integrated, flexible architectures Which means enterprises can now apply Systems Level thinking to transform IT and innovate in ways that dramatically improve their economics New opportunities are made possible: Business models Ways to deliver technology-based services Insights from IT What However, new challenges have to be met: Productivity of Information Technology Security of information and the IT infrastructure Management of integrated IT systems To take advantage of these opportunities and address the related challenges clients must focus on what matters most: Cloud for breakthroughs in service delivery Big Data to create new insight from analytics Optimized Systems to efficiently perform the work How Integrate existing and new data, processes and IT systems into a single system-level design IBM can help with how to proceed based on patterns we have experienced with clients project that: Automate IT for greater productivity Clients benefit from Smarter Computing - double capacity for IT services, hold IT costs flat and implement breakthrough new services Secure the IT infrastructure 16 Let s build a Smarter Planet.

13 These leaders are transforming economics to enable innovation Traditional approach Total IT cost Potential for re-investment Smarter computing Reduce Server Acquisition cost by up to 56% Reduce Labor overhead by up to 62% Reduce storage costs by up to 49% Reduce Power consumption by 80% Total cost per Workload 55% less Double capacity on a flat budget Capability and capacity 17

14 Smarter Computing is the transformation of IT based on what matters in this era; cloud, big data and optimized systems Cloud Big Data Optimized Systems 18

15 Smarter Computing yields the benefits of innovative and efficient IT University of Pittsburgh Medical Ctr. Doubled IT capacity on flat budget Delivered smart hospital room, reduce staff documentation by 50% GHY International Reduce hardware mgmt by 95% Track cross border shipments in real-time Cloud Virginia Commonwealth University Cost / TB down 50 55% Enabled anywhere, anytime access to clinical apps and patient data Acxiom 5X capacity with no additional floor space New cloud-based model for real-time marketing services Cardinal Health Infrastructure TCO dropped by more than 60% Transformed supply chain to improve compliance 19 Big Data Optimized Systems City of Norfolk Doubled capacity, cut power consumption in half Deployed automated parking systems, police in-car video surveillance

16 Designed for Data Big Data for better decision making

17 Imagine the possibilities made by possible by harnessing all available information to unlock insights. Information from Everywhere Extreme Scalability Radical Flexibility

18 Data Explosion

19 Integrating Big Data will Unlock New Insights Non-traditional/ internet data Streams filters incoming data Traditional Data Reuse Warehouse Analytic models Persistent Data In-Motion Data 23

20 IBM can provide the full set of capabilities to build any organization s information supply chain. Manage Integrate Govern Analyze Cut database licensing and maintenance costs by 25% Slash cost & time to publish product data sheets by up to 95% Pass SOX audit while reducing costs by up to 76% Reduce time to process valuations by up to 66% DB2, Informix InfoSphere: InfoSphere: InfoSphere FileNet Information Server Information Server BigInsights soliddb Warehouse Optim Warehouse Master Data Management Guardium Streams Information Protection Services Storage Efficiency and Best Practices Stop storing so much Move data to right place Store more with what s on floor Data Compression Data Deduplication Infrastructure strategy & planning for storage Automated Tiering Automated Data Migration Policy based management Intelligent storage services catalog Storage Virtualization Thin Provisioning Consolidated Storage Mgmt. 24

21 Tuned to the Task Optimized Systems for superior economics

22 Different workloads have different characteristics. Transaction Processing and Database Thousands of online users Large transactional databases 24x7 operation Business Intelligence and Analytics Fewer users Complex queries Multiple data sources Large data warehouse Business Process Management Unite content, people and process flows Orchestrate multiple services Empower business users

23 Optimized Systems will Address the Unique Needs of Specific Workloads Workload characteristics Microprocessor cores Applications Middleware Operating Systems Caches Package Semiconductors Domain Knowledge Interdependencies Interconnect I/O Software Stack integration Middleware tuned for hardware Integrated management across architectures Hardware Architecture options Multi-core architectures Advanced threading Low latency

24 Managed as a Cloud Cloud to reinvent business processes and drive innovation

25 Cloud Will Play a Fundamental Role in this New Era Cloud Masks complexity of underlying components Rapid deployment of processes and infrastructure Consumer driven services, process, deployment Business Services Consume business processes, analytics, applications running on Cloud infrastructure Platform Deploy consumer created or acquired applications on the Cloud infrastructure Infrastructure Rapidly provision computing resources for deploying and running software Public Hybrid Private

26 IBM Systems Provide an Ideal Foundation for Smarter Computing System z Power Systems System x IBM Storage Freedom by Design Performance Redefined Defining the Next Generation of x86 Servers Storage Reinvented Achieve up to 55% lower TCO per workload fit for purpose Power Systems running DB2 as low as 1/3 the cost of Oracle Database* Industry leading Intel performance and lower management cost by 50% Reduce power, operating and cooling costs by up to 60% Source: Based on IBM internal studies *Pricing comparison based on US list prices of IBM DB2 Advanced Enterprise Edition and the Oracle software with analogous capabilities: Oracle Database Enterprise Edition, Advanced Compression, Active Data Guard, Label Security, Partitioning, Oracle Enterprise Manager, Internet Developer Suite, Diagnostics Pack, Oracle-to-Oracle Federation, Golden Gate. All list prices based on US and valid as of 01/26/2011.

27 Watson Showcased the Capabilities of IBM s Workload Optimized Systems Built on Power 7 Technology A System Designed for Answers Built on a cluster of commercially available Power 750 servers Run 32 simultaneous tasks 8 Cores per processor 4 threads per core Twice the bandwidth of other commercially available systems, 500 GB per chip 15 terabytes of RAM

28 IBM s Integrated, Workload Optimized Systems Accelerate the Path to Smarter Computing Tightly Integrated Appliances Up in 24 hours or less Wire speed processing Data security, 5x less time Flexible Integrated Systems Deploy systems in days vs. months Reduce storage costs by 40% Lower energy consumption by 70-90% IBM WebSphere DataPower IBM Smart Analytics System IBM InfoSphere Guardium IBM PureScale Application System IBM Netezza IBM Cloudburst Source: Based on IBM internal studies

29 Through our work with thousands of clients, IBM has identified projects that enable any client to start their Smarter Computing journey Integrate 1 Optimize 2 Optimize Service 3 Infrastructure Delivery Workload Consolidation Systems Virtualization Data compression & deduplication IT Process management Master Data Management Drive Innovation Big Data Integration Business Service Management Automate Provisioning Automation Storage Tiering Automation Service delivery automation Application transparent database scaling Cloud Management Service optimization analytics Event correlation Value realized Secure 37 Value Delivered Identity and Access Management Vulnerability Intrusion Management Optimize utilization and performance across silos Operational Security Data audit Transform operations to manage in the context of the services delivered Relative scope and complexity of change Enterprise IT & Data Governance Enable new services and new business models

30 Smarter Computing And IT Economics

31 Improve IT Economics With Optimized Systems IBM Software Designed to exploit IBM hardware features automatically Optimized Systems IBM Servers and Storage Fit for Purpose servers and appliances Delivering more cores per server Plus purpose-built hardware innovations (Turbo Core, purescale, SSD, Easy Tier, Max5, Parallel SysPlex, DataPower ) IBM software optimized for IBM hardware features Lowest Cost Per Workload 44

32 Optimized Systems Examples Optimized by Design Packaged Solutions Appliances Capability DB2 & WebSphere on IBM Systems IBM Smart Analytics System 7600 IBM Netezza TwinFin IBM WebSphere Datapower XC10 Appliance Install Time Days Weeks Days Hours Technical Skills Flexible Deep Product and Performance Tuning Knowledge Basic Product Knowledge Focused Little or No Product Knowledge

33 Purpose-Built DataPower XI50z Appliance Delivers Stunning Price/Performance Enterprise Service Bus benchmark comparison BizTalk Server Microsoft BizTalk Server Windows on Intel Server 4 sockets, 32 cores 128 GB 492 messages per sec $764 per mps Windows OSB Linux Competitor Service Bus Oracle Linux on HP DL380 2 sockets, 12 cores 128 GB 5,839 messages per sec $120 per mps messages messages DataPower XI50z Tests consists of measuring maximum throughput of ESB while performing a variety of message mediation workloads: pass-through, routing, transformation, and schema validation DataPower XI50z in zbx 5,117 messages per sec $33 per mps 46

34 Hybrid Case Study Before Picture Multiple Workloads That Access System z Web Facing 30 workloads each driving 1975 tps CICS DB2 Competitive Application Server 30 Oracle SPARC T2+ T5440 servers, each 32 cores Service Bus 2 HP DL380 servers, each 12 cores z/os z196 GPs

35 Compare 3 Year Costs For Hybrid Web Workloads None IBM App Server 57 SPARC T3-1B blades in 2 SUN racks 2 HP DL380 servers 936 cores total $11.7M Web Facing 30 workloads each driving 1975 tps Option 1 30 SPARC T core servers 2 HP DL380 servers 984 cores total $23.7M WebSphere App Server 28 POWER7 blades 2 DataPower XI50z in 1 zbx rack 224 cores total zenterprise $4.9M

36 Improve IT Economics with Private Clouds and New Service Delivery Models IBM Software Virtual server lifecycle management Self-service automated provisioning Metering and billing Private Cloud IBM Hardware Capabilities Large scale server and storage virtualization Multi-architecture cloud platform Purpose-built innovations (Cloudburst, Cast Iron ) Transform IT service delivery Elastic scale Near instant self service provisioning Pay as you go

37 zenterprise Broadest Architectural Support for Private Clouds in One Integrated Platform z/os Linux on System z AIX on Power Blades Appliance Blades Linux on System x Blades* Fit-For-Purpose Strategy Workload z/os Workload Linux Image z/vm zenterprise z196 Workload AIX Workload Workload Linux zenterprise BladeCenter Extension (zbx) Assign workloads to the environment that best satisfies requirements Integrated Service Management Visibility, Control, Automation Achieves overall lowest cost per workload *Statement of Direction

38 Private Cloud on zenterprise A Perfect Example of Smarter Computing Principles Integrated Traditional mainframe strengths integrated with blade technologies Optimized environments for deploying diverse workloads z/os and Parallel Sysplex for large scale transaction processing z/vm for large scale consolidation and heavy IO workloads Smart Analytics Optimizer for analytic workloads DataPower for ESB workload Integrated management Automated Cuts down labor to setup and configure hypervisor and network environments avg time for network setup & configuration reduced from 26 hrs to 5 hrs in lab test zmanager ensures service levels are met automatically Secure Builds on the highest levels of security that mainframes have provided Comprehensive, sophisticated security features pre-built into everything from processors, networks, channels, virtualization environments and software EAL5 for PR/SM, Hipersockets, hardware crypto support, DB2 MLS, many others Transforming service delivery to achieve breakthrough IT Economics

39 Leading IT Organizations Are Engaging with IBM to Succeed in the New Era of Smarter Computing Our approach is inclusive no rip and replace IBM can deliver experts and expertise required IBMers are extending our portfolio to address the biggest challenges in computer science Proven innovator for 100 years Source: IBM Investor Relations *IBM Systems & Technology Group Finance, **IBM Software Group Finance

40 SMARTER COMPUTING use of hardware and software technologies to increase operational efficiencies and optimize workload performance while reducing Total Cost of Ownership Doing More for Less

41 Let s Build a Smarter Planet Thank You

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