There are two disruptions that are top of mind for IT leaders of almost every enterprise organisation today. Firstly, organisations are being challenged to address the disruption created by Broadcom’s acquisition of VMware and the subsequent licensing changes that have been introduced. Secondly, IT leaders are being driven by their business leader counterparts to develop a strategy around AI and deliver on AI business initiatives.
Gartner has described the Broadcom acquisition of VMware as the “most significant disruption in over a decade” to the server virtualisation market.1 The subsequent changes to the licensing model and go to market mean that many customers are potentially facing significantly higher renewal costs. Opinions about the merits of these changes are irrelevant, while – the fact is that every organisation will be required to make decisions about their data centre environment based on them. It is worth stating explicitly that this does not mean that every organisation will (or even should) move off VMware to an alternative hypervisor; but it does mean that every organisation will need to consider their options and make conscious decisions about how to proceed.
Organisations should think about this in a similar way to how they think of cyber risks – they need to make an active decision to avoid, mitigate, transfer or accept the risk. In the VMware/Broadcom context they need to decide whether to eliminate the issue (migrate to alternative solutions), mitigate the issue (optimise their environment to minimise the licensing renewal costs in the new licensing models) or accept it (decide that the costs associated with eliminating/mitigating the disruption are not worth it). There is no single correct answer to this dilemma as it will depend on each organisation’s current situation and overall strategy.
For organisations today, large or small, the question isn’t whether they should tap into AI – it’s how. For this reason, IT leaders are challenged to develop AI strategies that not only enable the AI initiatives that their business leaders are requesting but do that while achieving a return on the investment. This is a critical point as Gartner has predicted that 30% of GenAI projects will be scrapped by the end of 2025 due to lack of ROI2.
It can seem like these two disruptions are pulling IT organisations in opposite directions but when you step back and look at them, IT leaders should think of both these disruptions as driving them towards data centre modernisation. The key realisation should be that AI applications are inherently modern applications that are almost always containerised, and that one of the key strategies to reduce VMware reliance is to modernise applications as much as possible. IT leaders should therefore use this as an opportunity to modernise their data centre and invest in solutions that enable modern applications, have automation as a key tenet and are ready for AI workloads.
The data centre modernisation phrase is thrown around a lot these days, so it worth being clear about what we mean in this context. From our perspective, a modernised data centre is one that
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