UPDATED 12:40 EDT / OCTOBER 25 2017

CLOUD

Google and Cisco join forces on hybrid cloud computing push

Google LLC and Cisco Systems Inc. said today they’re joining forces to help corporate enterprises more easily develop software that spans private data centers and public cloud computing.

The deal is intended to allow companies to run software consistently in a so-called hybrid computing environment in which some work can be done in the cloud while also continuing to do some computing jobs in on-premises data centers.

Both companies have been scrambling to contend with the rise of cloud computing led by Amazon Web Services Inc. and Microsoft Corp.’s Azure cloud. Google was a latecomer to the cloud market despite running its huge search and advertising infrastructure largely in a cloud environment, while Cisco’s networking hardware businesses have been slammed as customers decide to get the similar capabilities from cloud providers.

The nonexclusive pact points up the reality that many large companies aren’t ready to move all their operations to the cloud because of potential business disruptions or regulatory requirements concerning data. But the two companies are hardly the first to push hybrid cloud computing.

Everyone from Oracle Corp., Microsoft Corp. and Dell Technologies Inc. to a raft of hard-charging startups such as Nutanix Inc. is already well along in that market. AWS also has a wide-ranging deal for hybrid offerings with VMware Corp., which is under the Dell umbrella following the completion of Dell’s acquisition of EMC Corp. about a year ago. But Google and Cisco are still two very potent forces in their respective sets of markets.

“While it might feel like a me-too announcement, there’s a stronger base on which this relationship is built,” said Eric Hanselman, chief analyst at 451 Research. “Enterprises are struggling to sort out how they’ll realize the promise of hybrid architectures. Bridging on-premises and cloud is where real value can be generated.

It’s still fuzzy precisely what the joint Google-Cisco offerings will comprise, however. And they won’t be generally available until the second half of next year.

Google’s contribution is its cloud platform, a collection of computing, storage, database, analytics, machine learning and other services provided online. “This partnership enables developers and IT departments to seamlessly take advantage of the most open, secure tools for building modern applications in a hybrid environment,” Diane Greene, senior vice president in charge of Google Cloud Platform, said in a statement.

Cisco’s offering includes networking, security and related services. Both will be providing open-source technologies in the mix. The goal is to provide the same networking and security policies across private data centers and the cloud.

“Our solution abstracts the various capabilities in environments – including on-premises and in the cloud – enabling applications to connect with the native capabilities in whatever environment they are run in,” Kip Compton, vice president of Cisco Cloud Platform and Solutions, explained in a blog post. “This means developers can build modern applications wherever they want and deploy wherever they want, unlocking tremendous developer productivity. Now, you don’t need to ‘lift and shift’ to get cloud speed and agility.”

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Both companies could benefit if customers bite. Google has struggled to gain a significant presence in large corporate enterprises, where most of the opportunity in cloud computing will be in coming years. Despite years of effort, Google has only a 5 percent share of the cloud infrastructure services market, according to Synergy Research Group, while AWS has 34 percent. Allying with an enterprise stalwart such as Cisco could help crack open larger accounts.

“For Google it’s a win because an onramp into the enterprise,” said Marty Puranik, chief executive of cloud hosting provider Atlantic.Net. “It becomes a traction channel for high-quality customers.”

As for Cisco, it has been in a slow transition away from a dependence on hardware to becoming more of a software and services company with more steady subscription-based revenues. Earlier this week, for instance, it spent $1.9 billion to buy business communications services firm BroadSoft Inc. for its subscription-based business. Joining with Google, a unit of Alphabet Inc., gives it some cutting-edge cloud capabilities with a company that now seems fully engaged in becoming a force in cloud computing.

“The interesting opportunity for a partnership between Cisco and Google is the combination of Cisco’s strong enterprise and service provider presence with the open source connectivity from Google,” said Stu Miniman, senior analyst with Wikibon. In particular, he called out the two key technologies involved in the deal: Kubernetes, which “orchestrates” or manages software containers used to allow applications to run easily across many computing environments, and Istio, a “service mesh” that provides functions such as traffic management and authentication that cloud applications need.

“Orchestration and service mesh services are strong fit for coordination with networking in a multicloud world,” Miniman said. “Customers are in need of partners that can help them span across many environments and have consistency of data management and security.”

Still, how much difference the alliance will make for either company remains uncertain. The deal is an acknowledgment by each company that it lacks what the other has. “Google saying to Cisco, ‘We have the tech, give us your channel — we need help in the enterprise,’” said Wikibon Chief Analyst Dave Vellante.

But Puranik pointed out that there are many competing alliances in hybrid cloud computing that suggest the market won’t settle down anytime soon. “The market is moving and everyone is positioning, but there isn’t a clear winner yet,” he said.

Image: Adina Voicu

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