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Atos future-proofs compute ahead of Great Acceleration

As the world awaits the scientific discoveries needed to bring quantum processors to commercial applicability, Atos’ BullSequana XH3000 allows for ecosystem participation within the compute platform itself and future-proofs any early buyer investments. In its Feb. 16 official announcement of the XH3000 supercomputer, for which TBR was provided pre-briefing access, Atos claims the product will have a six-year life cycle and that it is an open architecture capable of housing up to 38 blades. The blades can accommodate a mix of different XPU processors, with more under consideration and development.

The rapid rise in large data sets and evolving AI/machine learning (ML) algorithms have driven this global appetite for greater compute capacity — an appetite that many data scientists believe will only be sated once quantum computers reach commercial viability. Atos’ early lead in quantum simulators and alliances with various quantum systems vendors imply the company will be capable of pivoting its high-performance computing (HPC) offerings quickly to accommodate the addition of commercial-grade quantum processors when they arrive. Atos’ flexible hybrid supercomputing architecture will sell well in Europe for a variety of reasons and may enable Atos to gain share against notable HPC vendors in North America and Asia.

Data and AI require new compute platforms to address intractable problems

Atos correctly asserts the state of compute trails the size of the data sets that are available to run algorithms. Specifically, the world is running out of computational capacity to address the complex problems that can now be simulated and analyzed through increasing digitization.

Proof points offered in the Atos announcement included:

  • Average HPC job durations grow as larger data sets will be applied against systems with as many as 10,000 nodes and 25,000 endpoints.
  • Application refactoring and algorithm refinements can provide as much as a 22x speed improvement.
  • Data centricity and edge processing grow in use case applicability, requiring greater hierarchical depth and more localized compute near the application.
  • Hybrid Sim/AI Workflows for approximate computing are nearing reality. Atos offered the example of Alphafold 2 for protein folding prediction reaching over 90% accuracy, whereas classical methods currently achieve between 30% to 40% accuracy.
  • Yet another industry prediction of reaching the physical limits of Moore’s law now that the industry is at 3nm technology.
  • Extending the performance gains from classical computing while quantum discovery and commercialization advance will require greater innovation around multiple XPU architectures. These hybrid or heterogenous compute architectures need a new compute system structure, which Atos believes the XH3000 system provides.

The Atos Exascale strategy is a hybrid approach that serves many masters

Atos states the future of supercomputing will be hybrid. According to Atos, the future of supercomputing will involve a hybrid approach, consisting in the near term of a blend of classical CPU configurations and specialized processor architectures to address specific workload requirements. Presently, Atos collaborates with AMD (Nasdaq: AMD), Intel (Nasdaq: INTC), Nvidia (Nasdaq: NVDA), SiPearl and Graphcore, among others. Eurocentric chips based on ARM designs are also in the news and have been discussed by Atos.

Atos has addressed the need for future-proof flexibility in its designs by building the standard chassis of the BullSequana XH3000 to accommodate up to 38 compute/switch blades on one rack to be mixed and matched as workflows require from the different blades currently available and available in the future.

This hybrid architectural design approach serves many masters, such as those addressing:

  • Sustainability: Different cooling and processing designs not only generate greater computational capacity but also, when coupled with the hybrid configurations and algorithm innovations, can lead to lower power consumption, and therefore lower carbon footprints.
  • Sovereignty: Technonationalism is not going away, and Atos is a flagship European technology vendor. Former Atos CEO Thierry Breton is now the commissioner for internal market affairs within the European Union (EU) and has been tasked with managing many elements pertinent to digitization and “enhancing Europe’s technical sovereignty.” The EU has clearly stated its intentions to ensure there are European-controlled processors in market. Hybrid computing structures enable companies to select different processors to address the computational requirements amid the increased attention nation states place on compute access as a strategic national interest.
  • Higher performance: The HPC market increasingly takes on the dynamics of emerging ecosystem business models and requires a physical compute stack that can accommodate the many tech stack variations the ecosystem can create to address the world’s compute and AI challenges. Atos claims it also has built the architecture to be resilient and adaptable for six years without forklift upgrades. This flexibility, Atos asserts, can accommodate new discoveries as the unknowns around deep learning, algorithm development and new processor developments in the classical and quantum computing realms come into view.

Hybrid delivery models, diversified partnerships and expanded portfolios alleviate vendor revenue pressures

Key Insights

Hybrid delivery — Virtual selling and management consulting service delivery replace face-to-face interactions between vendors, clients and partners.

Partnerships — Emerging technologies necessitate more complex ecosystems, pressuring all players in the IT services space to partner differently.

Portfolio expansion — Vendors are establishing applications and infrastructure managed services capabilities to provide design-build-run solutions.

The Management Consulting Benchmark provides key service line, regional, vertical and operational data and analysis for 13 leading management consulting firms. The research program also includes a deep dive into 11 vendors’ management consulting business strategies as well as SWOT analysis.

Hybrid engagements will become necessary and valuable in 2021

Here comes hybrid

Hybrid engagements, in which IT services vendors and consultancies deliver both virtually and face-to-face, did not first arrive in 2020, but there has been one dramatic change from pre-pandemic days: universal acceptance that hybrid engagements will be necessary and can be a valuable way to conduct business. In 2021 vendors and consultancies with the perfect hybrid engagement model will outperform peers and accelerate consolidation across the IT ecosystem.

We always come back to the idea that services is fundamentally about people delivering value to other people. And for years, we have heard IT services vendors and consultancies extol the values of connecting humans and machines, expanding human experiences with artificial intelligence, and improving human work with robotic process automation. The human + machine future is here now, and it is hybrid. For many IT services vendors and consultancies, accelerating that digital transformation journey to hybrid engagements will require retraining talent, reconvincing clients of value and partnering differently across the ecosystem.

Maybe the best example of the hybrid engagement model for IT services vendors and consultancies is the application of hybrid in American schools as a reaction to COVID-19. U.S. elementary school teachers — whose average age is over 40 — have become more technologically adept and better at delivering lessons to both a camera and a classroom. Teachers have learned to manage virtual breakout pods and gauge virtual interactions. Students know the social benefits of being in the classroom but now understand that remote learning can include more depth and detail and a more concentrated learning process. (Of course, this is not true for all students and teachers, just as hybrid IT services and consulting engagements have not been perfect for all IT services vendors and consultants.) IT services professionals and consultants can now become far more adept at delivering both in person and remotely and have made collaborative technologies a natural extension of the job. Clients now receive services and adapt to different ways of working, recognizing the value, cadence and duration of services relationships can be sustained without face-to-face encounters. And just as everyone wants students back in the classroom full time, everyone also realizes on some level that some things have changed forever. No more snow days, ever. Business travel will never be the same. Digital transformations will accelerate and emerging technologies will increasingly permeate every aspect of IT services and consulting, bringing newfound speed and adoption both virtually and in person.

The following predictions examine how hybrid engagements might develop further in 2021, the potential impact of hybrid engagements on IT services vendors’ and consultancies’ technology partner ecosystems, and the revival of industry clouds across the entire IT market.

2021 Predictions

  • Hybrid selling and delivery replaces face-to-face as the standard and preferred engagement model
  • Emerging technologies necessitate more complex ecosystems, pressuring all players in IT services to partner differently
  • Industry clouds return, with competitive consequences for it services vendors and consultancies 

Register for TBR’s 2021 Services & Digital Predictions webinar, Hybrid engagements will become necessary and valuable in 2021, Jan. 20, 2022.

Technology Business Research 2021 Predictions is a special series examining market trends and business changes in key markets. Covered segments include cloud, telecom, devices & commercial IoT, data center, and services & digital.

Technology Business Research announces 2021 Predictions webinar schedule

Technology Business Research, Inc. (TBR) announces the schedule for its 2021 Predictions webinar series. 2021 Predictions is a special series examining market trends and business changes in key markets. Covered segments include telecom, cloud, devices & commercial IoT, data center, and services & digital.

Jan. 6            COVID-19 changes everything: What’s next for devices and IoT?

Jan. 13         2021 will bring more demand, more partnerships and more industry innovation to cloud

Jan. 20         Hybrid, ecosystems and industry clouds shape the future for consulting, IT services and digital transformation

Jan. 27         CSPs face brave new world in 2021

Feb. 3           COVID-19 necessitates data center investments, becoming a catalyst for digital transformation

TBR webinars are held typically each Wednesday at 1 p.m. EDT and include a 15-minute Q&A following the main presentation. Previous webinars can be viewed anytime on TBR’s Webinar Portal.

For additional information or to arrange a briefing with our analysts, please contact TBR at [email protected].

Hybrid, ecosystems and industry clouds shape the future for consulting, IT services and digital transformation

Join Patrick M. Heffernan and members of TBR’s Professional Services and Digital Transformation teams as they explore three developing trends: the evolution of hybrid consulting, new ways of partnering across a changing IT services ecosystem and the return of industry clouds. Additionally, the teams will review 2020 performance and strategies of key players in the market and predict the impact of these trends in 2021.

Don’t miss:

  • How the consulting business model has finally begun shifting to accommodate a post-pandemic world, with face-to-face selling and delivery replaced by a hybrid engagement experience
  • Why maturing emerging technologies necessitate more complex ecosystems, pressuring all the players in the IT services space to partner differently
  • After the death of digital in 2020 and as cloud providers begin reintroducing industry clouds, how professional services vendors will partner to accelerate previously lethargic cloud adoption, even as they ward off encroachment by those same cloud vendors into services opportunities

Mark your calendars for Wednesday, Jan. 20, at 1 p.m. EST,
and REGISTER to reserve your space.

TBR webinars are held typically on Wednesdays at 1 p.m. ET and include a 15-minute Q&A session following the main presentation. Previous webinars can be viewed anytime on TBR’s Webinar Portal.

For additional information or to arrange a briefing with our analysts, please contact TBR at [email protected].

3 ways hybrid engagements will change consultants’ innovation & transformation centers

Join Principal Analyst Patrick M. Heffernan, Senior Analyst Boz Hristov and Analyst Kelly Lesiczka as they detail three key forces shaping the way IT services vendors and consultancies adjust their innovation and transformation centers to the new reality of hybrid engagements. With over 50 on-site visits to these digital experience centers prior to the COVID-19 pandemic, Patrick, Boz and Kelly bring firsthand understanding of how these centers have been designed, staffed and operated as well as what changes customers can expect from these centers going into 2021.

Don’t miss:

  • What the best-prepared consultancies did to shift to all-virtual engagements, and how quickly they will evolve to a hybrid model
  • How clients’ expectations changed before the pandemic, and what new demands will emerge in 2021
  • Why hybrid engagements at innovation and transformation centers signal a shift to hybrid consulting

HPE’s array of hybrid workplace offerings provides silver lining for customers amid the pandemic

HPE bundles its existing portfolio in a GreenLake wrapper

When CEO Antonio Neri initially announced in June 2019 that HPE (NYSE: HPE) will offer everything “as a Service” by 2022, many were skeptical that the plan would resonate with the market as a whole. It was clear that pockets of customers would buy into this offer, particularly in the SMB space, where pricing can have a greater impact. But for major customers, the conversation often boiled down to something as trivial as where to put the expense on the balance sheet for stakeholders. However, considering the changing market dynamics over the last six months due to the pandemic, this aggressive marketing campaign could not have come at a better time. Because HPE has been pushing GreenLake hard since 2019, the vendor is now serendipitously ahead of peers on its “as a Service” offerings.

HPE’s “as a Service” push is directly related to increases in IT sprawl. “Sprawl” is a concept the IT industry has grappled with for decades. Prior to distributed IT environments, the term was used to describe the increase in the variety of workloads in each environment. Now, it is used when describing a single-pane-of-glass management console to ease the burden placed on IT personnel when managing a diverse environment of IT infrastructure. Sprawl is now the upshot of the increasingly diverse application of technology to business, or digital transformation. Diverse applications lead to diverse IT requirements, from the edge to the core to the cloud, making cloud an integral piece of the story and establishing the importance of bundled solutions that provide business outcomes, which is precisely what GreenLake can provide.

GreenLake does come at a premium, as software and services are baked into hardware deals consumed through this model in many cases, but pricing it as a monthly subscription makes these solutions more available and affordable to firms with less capital support. HPE GreenLake clearly resonates with customers, as key competitors Dell Technologies (NYSE: DELL) and Lenovo both formalized their own consumption-based pricing offerings after GreenLake began to gain traction, although Dell Technologies did have informal offerings emerge around the same time as GreenLake initially. With COVID-19, the edge becomes increasingly more important as organizations deploy new workloads in their factories, office spaces and retail locations to ensure public safety while returning to work.

HPE’s workplace portfolio of solutions is attractive for several reasons. HPE’s existing infrastructure portfolio is augmented by HPE Aruba’s connectivity engine and associated services through HPE Pointnext Services, which combines expertise across workplace networking and IoT. The combined offering is then layered with GreenLake and sold as a use-case-based package to end customers, the primary benefits being the efficiencies gained in conjunction with the fact that the solutions are positioned and sold as business outcomes. Essentially, HPE takes care of the grunt work normally weighing down the end user but offers increased manageability and increased control at a reduced effort through GreenLake, leveraging the existing expertise within its organization to reimagine how the world of knowledge-based employees works and what is necessary to make it operate seamlessly in a hybrid model.

IT vendors are poised to solve the challenges that have arisen in the wake of the COVID-19 outbreak, and Hewlett Packard Enterprise (HPE) is a prime example of a vendor that, in response to the pandemic, is addressing previously unforeseen challenges by formalizing offerings pertaining to the workplace. Hybrid working was a pre-existing trend that COVID-19 has accelerated. However, for those individuals working in a knowledge-based field or with school-aged children, how they work and learn has fundamentally and permanently shifted. Further, people with non-knowledge-based jobs, many of whom lost work due to COVID-19, will find in-person work again, and these jobs will also see a fundamental shift in how they are performed to ensure safety and productivity. HPE’s announcements today at Workplace Next highlight how the company’s portfolio can be leveraged to ease customers’ COVID-19 mandated digital transformations.

Vendors with hybrid strategies gain revenue opportunity

Hybrid deployments on the rise

Hybrid-influenced vendors are benefiting from instituting a vendor-agnostic approach, working with third-party vendors that offer cloud management tools and services. TBR expects IBM’s position in the hybrid market has been greatly strengthened since the company obtained a powerful integration layer for hybrid multicloud environments through the acquisition of Red Hat. However, other vendors like Microsoft, and now VMware, will challenge IBM’s PaaS-led approach going forward. As more vendors like VMware rapidly exit lower-margin software and instead battle for hybrid workloads, the competitive landscape will shift.

TBR’s Hybrid Benchmark helps providers of hybrid environments and their partners align to growing opportunity, highlighting the market size of hybrid-influenced public cloud, hosted private cloud and traditional software; the go-to-market strategies vendors are using to drive revenue in the hybrid IT space; gaps in the current ecosystems for enterprises; how vendors are addressing customers’ integration challenges; and more.

Hybrid-influenced vendors respond to customer demands, including limited vendor lock-in and seamless, secure integrations

Hybrid-influenced vendors sit in a high-growth market as they rely on proprietary infrastructure to architect in-demand hybrid solutions. Microsoft (Nasdaq: MSFT) is separating itself from much of the market as many enterprises use Office 365 in a hybrid environment and as the vendor wins legacy VMware (NYSE: VMW), Oracle (NYSE: ORCL) and SAP (NYSE: SAP) workloads. Among vendors competing for legacy workloads, TBR expects Amazon Web Services’ hybrid-influenced revenue will continue to grow as the vendor strongly competes against Microsoft for the enterprise migrations.

TBR’s Hybrid Benchmark helps providers of hybrid environments and their partners align to growing opportunity, highlighting the market size of hybrid-influenced public cloud, hosted private cloud and traditional software; the go-to-market strategies vendors are using to drive revenue in the hybrid IT space; gaps in the current ecosystems for enterprises; how vendors are addressing customers’ integration challenges; and more.