The New IT Cold War?

The talk and actions over the past 6 months clearly indicate that the IT industry is aligning for a new world.  Are these events a new trend or simply part of the constant expansion and contraction of the technology organism?  History has taught us that a strategy of “going at it” all alone can leave countries isolated.  However at the same time countries must be particularly careful in choosing their allies.  Without naming any countries, time has shown us that allies end up become enemies and vice-versa throughout the world.   Some would argue that this is as a result of having converging or diverging interests with each other.

The big Fortune 100 information technology providers have all been trying to assemble a complete as possible vertically integrated solution stack.  This stack encompasses the major building blocks of the network, compute, data and applications.  I can think of two other industries where there are some parallels.  In the beginning of the last decade the large telecommunications carriers were being severely challenged by small upstart carriers that were deploying next generation switching technology.  Provisioning new capacity no longer required weeks but merely seconds by the click and point of a mouse operator.  Huge cost savings and efficiency with much less hardware and overhead.  The telecom industry was a melting pot until the 2001 bubble occurred.

The second example is the automobile industry.  Over the past 30 years the auto industry has experienced growth, joint ventures, mergers and recently massive contraction.  The auto industry will recover eventually and ultimately there will be cooperation among the auto industry.  It is understood that consumers will not tolerate a single automobole supplier for the world.

For the IT industry companies are the consumers.  Most if not all businesses do not tolerate a single sourced supplier arrangement.  For example if widget x is critical, a company will ensure that widget x is supplied by vendor a and vendor b.  Some businesses will also ensure that vendor c can supply widget x as well on short notice.  It makes logical sense that most businesses will treat their IT supplier(s) in the same manner as all their critical suppliers.

The progression in the IT industry will keep moving forward and that is truly exciting.  However dominant players may need to construct a strategy that can deliver both vertically and horizontally integrated solutions.  Ultimately it is the IT providers and IT customers that depend on each other.

Consumers (businesses) will not tolerate a single IT provider for the world either.

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