Qualcomm, the Server Supplier: Not Quite as Funny (or Easy) as it Sounds

Brad Shimmin
Brad Shimmin

Diversity drives innovation. Operating systems, storage devices, or networking equipment, and yes, even server architectures all took dramatic leaps forward in capability at various points in the storied but short history of enterprise technology, owing to innovation that was fueled by competition. For that reason alone, the idea of Qualcomm pushing the ARM chip into the server market, as was announced last week, is quite exciting. Why? If anything, ARM chips have proven that you can be both quick and energy efficient, two traits that are most welcome in any data center. Perhaps because of this we will see more emphasis placed upon this combination of traits from the incumbent market leaders. For more on this interesting development and how it might play out for enterprise buyers, I’ve included below some thoughts from my colleague, Peter Jarich.

Summary Bullets:

  • Qualcomm announced a plan to move into the server space at its 2014 Financial Analyst Meeting
  • While ARM expertise will play in Qualcomm’s favor, it may take a while for that to matter to buyers

Last week, Qualcomm used its 2014 Financial Analyst Meeting to signal an entry into the server market. You can be completely forgiven for not paying attention: it doesn’t seem like the media picked up on this much, and the notion of Qualcomm – a vendor known best for supplying silicon into mobile and connected deices – moving into a crowded server chipset space might seem like a typo or misunderstanding as much as it does a business reality.

Alas, it’s true. It’s also not that surprising.

At a very basic level, the logic is super-simple. Cloud business and architecture evolutions – including the move towards NFV in the telecom space – promise to drive server sales through the medium-term. ARM architectures have long been touted as critical for supporting scalable, energy-efficient server designs and data center growth. Qualcomm, thanks to its position with mobile and connected devices, is one of the market’s dominant ARM-based silicon providers. Where there’s expertise and a market that expertise plays into, it only makes sense to connect the dots, right?

Maybe.

Qualcomm’s position in the ARM ecosystem cannot be denied. Near-term market interest in ARM-based servers is another topic. Yes, ARM’s focus on energy efficiency is a major selling point. Yet, whenever I ask telecom vendors how much energy they’re putting towards ARM in their NFV efforts, the answer is essentially, “none.” The rationale? Operators just aren’t asking for ARM-based solutions yet. Admittedly, this is a relatively narrow anecdote. It’s telling, nonetheless. In their NFV efforts, after all, carriers are responding to the efficiencies obtained by web-scale and data center players. If neither party looks to be too excited about ARM in the near-term, what does that mean for Qualcomm?

While that was a rhetorical question, I can provide something of an answer: nothing. Connected device sales and technology development will keep the company busy for some time. Time enough, in theory, to build up its server credibility and allow for ARM demand to grow.

Vodafone – Riding its Competitive Advantage to Expand in Adjacent Markets

ITCB-HarishTaoriSummary Bullets:

  • In its annual global analyst event, Vodafone emphasized its evolution as a global “Total Communications” service provider.
  • Planned new investments, under Project Spring, to enhance the network (NFV, SDN) and solutions (M2M, Cloud connect, UCaaS) capabilities globally.

Vodafone hosted its annual global analyst event this year in London. This blog post summarizes some of the key takeaways from that event, and analyzes the implications on industry and enterprises.

  • The key theme was Vodafone’s strategy to become a global total communications service provider. Vodafone is making concerted efforts to enable this strategy by expanding global network (fixed and mobile) reach and related communication services (cloud, mobility unified collaboration, and M2M) portfolios.
  • Vodafone has deep network reach in 60 countries with 211 fixed PoPs in 161 cities. In AMEA, Vodafone has recently added new PoPs in Philippines, Taiwan and 22 African countries expanding its network presence in 14 Asia-Pacific, three Middle East and 24 African countries. Vodafone intends to expand its global coverage to 92 countries by end of 2016. Under Project Spring, Vodafone commits to invest GBP 500 million in five years to scale up its network and solution capabilities, people and offices across Asia and Africa
  • Vodafone has witnessed good momentum in its M2M portfolio, especially from automotive, consumer electronics and utilities verticals. The acquisition of Cobra consolidated Vodafone’s position in automotive, as Cobra’s clientele includes Porsche, Ferrari, Renault, and Toyota. Furthermore, Cobra enables Vodafone to provide solutions for embedded and aftermarket automotive opportunities in 41 markets as well as in fleet management for rental, leasing, and sharing of cars.
  • Vodafone reiterated its competitive advantage in mobile networks. Leveraging its core capabilities, Vodafone is offering comprehensive enterprise mobility solutions. Vodafone is further extending its service portfolio in adjacent businesses – cloud and hosting, unified communications and collaboration. Currently these services are available in US and Europe and expected to come in AMEA by next year.
  • Vodafone Global Enterprise (VGE) is targeting 1,700 global MNCs. Its key value proposition for these customers is a consistent global SLA across Vodafone and partner networks. ‘Mobile First’ people and process initiatives are key themes among VGE customers. Vodafone has also created a business unit to target SMEs. SME products and solutions are expected to roll out in AMEA by next year.

Implications on SP and enterprise ICT buyers:

  • Vodafone – Vodafone’s ICT solutions are primarily available in Europe. It needs to ramp up efforts to promote its ICT solution portfolio in APAC and MEA, to be seen as an end-to-end solution provider for global MNCs interested in expanding their operations in emerging markets. Furthermore, the company has to articulate its value proposition, specifically for verticals, to differentiate itself from its global and regional competition.
  • Enterprises – Asian automotive OEMs can evaluate Vodafone’s capabilities to provide M2M solutions for Infotainment, connected cars and insurance companies for usage based insurance (UBI) service. Global and regional MNCs expanding their business outside Asia can consider Vodafone’s network and ICT solution capabilities for cloud, M2M, and unified communications/collaboration against similar offerings from other global and regional service providers.