Why Web Giants Buy Dell Infrastructure There is no Santa Claus.  It's crushing as a 7 year old to come to that realization after years of believing in the narrative. But the jolly man in a red suit isn't the only myth being exposed these days.  Also, the supply chain for some of the world's largest cloud data centers isn't necessarily what everyone believes it to be either. Some believe that all large cloud data center customers are actually bypassing the OEMs, going straight to the ODMs in Taiwan and specifying their own custom hardware to save money. While there are a few companies doing this, companies like Google, it is far from the norm, and instead is as much of an oddity as a flying reindeer. OEMs like Dell are innovating to address the market in a more unique way as we discuss in our paper.  Dell's division called Data Center Solutions (DCS) that has customized solutions for these cloud data centers, and can address the full supply chain for a customer. There is a certain glamour in the idea of cutting out the middleman, going straight to the source for those "factory direct" prices and more control over logistics.  Recently IDC reported that over 325,000 direct servers were sold into this market; despite that small number, it is the fastest growing part of the market. But in reality, that model works for only a few of the largest companies like Google who are willing to step up and take on the challenges involved in the decision. Furthermore, the commoditization that has occurred over the last 10 years in the server market has shrunk margins to the point that there are not too many places in the hardware to find huge savings any longer. ODMs like Foxconn, Quanta and Wistron primarily do the development work for OEMs, developing the hardware platforms. Then the OEM (like Dell and HP) add in their secret sauce -- software, services, management tools, low level software, logistics, financing, support, integration, distribution, etc.-  to deliver a complete package to the end customer.  While it seems appealing to go directly to the source, ODMs are not necessarily the largest source for much of servers that are running today's cloud data centers. In fact, the bigger surprise to many is that OEMs are still delivering more of these servers than ODMs. OEMs still account for more than 85% of all of the server shipments and over 90% of the revenue.  The reasons make all the business sense in the world. http://www.forbes.com/sites/patrickmoorhead/2013/12/12/why-web-giants-buy-dell-infrastructure/ Spotify sets mobile music free. What took so long? analysis Even for the music labels' darling, giving listeners their streaming preference -- mobile and free -- took Spotify a long time. Blame the slow healing of the music industry and the morass of music licensing. [Read more]     http://feedproxy.google.com/~r/cnet/tcoc/~3/ysj3pzHYVnQ/story01.htm Bitcoin Wallet Coinbase Deposits $25 Million From Andreessen Horowitz Coinbase announced a $25 million Series B round of funding, led by Andreessen Horowitz?s Chris Dixon. On top of a Series A from Union Square Venture, it makes Coinbase the most-well-funded start-up in Bitcoin, with a total of 31 million real world dollars sunk into it. http://www.forbes.com/sites/kashmirhill/2013/12/12/bitcoin-wallet-coinbase-deposits-25-million-from-andreessen-horowitz/ http://www.wochit.com

• published: 12 Dec 2013
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