Opsware Adds Storage, Process Management with System 7 Tools

Published: September 25, 2007

by Timothy Prickett Morgan

Just as Hewlett-Packard was dotting the Is and crossing the Ts of its $1.6 billion acquisition of system management tool maker Opsware to bolster its HP Software division, Opsware is this week hosting its Opsworld user conference in San Diego and previewing the capabilities it will provide in the forthcoming Opsware System 7 tools. With this release, the Opsware tools will add storage and process management to existing server and network management modules, allowing its tools to span the entire data center for the first time.

HP's software business has been broadened and deepened by a number of important acquisitions, most importantly the $4.5 billion acquisition of Mercury Interactive in July 2006. But it could turn out that in the long run, Opsware brings as much revenues and profits to HP as Mercury businesses do. Because companies are sick of dealing with sprawl in the data center, and they need to add capacity (both physical and virtual) while at the same time reducing the number of administrators they have managing their systems (again, both physical and virtual), Opsware System 7 should be the right tool at the right time. According to estimates by IDC, it cost $120 billion to manage the 32 million servers installed worldwide in 2006, and the rate of change on the cost of managing servers is growing a lot faster than the installed base of servers; net new server spending is one-third this amount. By Opsware's own reckoning, for every $1 in hardware spending, customers have to spend $3 to $4 per year to manage that hardware, which means that over the three years when hardware costs are being amortized, companies still keep paying to administer and maintain it, to the tune of $9 to $12 against that $1 of hardware spend. This is a big problem, and by the numbers, it is a lot more money than the power and cooling issues that are plaguing data centers and getting so much press right now, too.

Jason Rosenthal, who is senior vice president and general manager of server automation products at Opsware and who will run the Opsware business after it is integrated into HP, says Opsware has more than 450 customers, more than 500 employees, and is on track to make $142 million to $147 million in its fiscal 2007. Considering how long Opsware has been around and that its products can deliver return on investment in the range of 500 percent to 2,000 percent as server administrators can go from managing 20 servers to an average of 60 machines or, in best case scenarios, as many as 350 machines, you would think that Opsware would have as many customers as VMware by now, and be as much of a name in the data center. Rosenthal did not offer an opinion about why this hasn't happened, but he did put a stake in the ground when asked why Opsware did not have 5,000 or 10,000 customers already. "I think we are on the way now with System 7," he said. "We have assembled the killer product. Storage really completes the data center hat trick."

And with the full backing of HP--which used the Opsware tools in its own services business before it decided to buy the company--the Opsware tools are set to get a big push so HP can recover its investment. As it has done with OpenView and other software products, HP is going to keep Opsware a vendor-neutral product set--much as EMC has done with VMware, to its credit. HP may own the largest piece of the server market, but it is still a minority stakeholder in terms of both sales and shipments. It has to play nice with others.

Thanks to Opsware's acquisitions of iConclude and Creekpath, the suite of tools now has an integrated means of managing the processes related to IT gear. So, to use a concrete example, this means that Opsware doesn't just do a patch on a server, but uses best practices, embodied in an Opsware template or those created by the IT staff, to ensure that the a patch is performed the same way on all servers. This workflow and process management software came from the iConclude deal and is now known as Process Automation System. Creekpath was the foundation of the new storage management features that are part of Application Storage Automation System, which is used to provision and manage storage much as the Server Automation System module (the first Opsware product) provision, patch, upgrade, and otherwise manage servers. The important thing about Opsware System 7 is that every part of the suite is under control of the Process Automation System and, with this release, customers can use a tool called Visual Application Manager to visually represent the gear in their data center and how it interconnects and is managed. Up until now, only the server tool had policy management.

Opsware System 7 can provision and patch Linux, Windows, and Solaris servers, and has some integration with HP-UX and AIX machines as well. Opsware licenses its product based on the number of operating system instances or Opsware agents that are being monitored and controlled by the suite. A license to Server Automation System costs $50,000 for 250 operating system instances or Opsware agents; virtual servers are counted the same as physical ones. Network Automation System costs $10,000 for a core that can handle up to 999 network nodes; it costs $400 per node for the first 99 nodes on top of that. Process Automation System is a bit pricier, costing $75,000 for up to 250 operating systems or Opsware agents. Adding the Application Storage Automation module to the server tool costs another $25,000 for 250 instances.

The Opsware System 7 set of tools will not be available until the fourth quarter.

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