Teradata customers express terror as field-based hardware support outsourced to IBM on both sides of the pond
(2021/07/09)
- Reference: 1625827506
- News link: https://www.theregister.co.uk/2021/07/09/teradata_outsources_on_premise_data_warehouse_hardware_support_to_ibm/
- Source link:
Teradata is outsourcing field-based support on both sides of the pond to IBM, much to the alarm of some customers who fear a loss of knowledge in keeping its trusted on-prem systems up and running.
The global data warehouse stalwart made its name with tightly integrated software and hardware systems sold as analytics "appliances", but in the last two years has shifted focus to its cloud platform following fierce competition from so-called cloud-native rivals including Snowflake, AWS, Microsoft, and Google.
In the UK alone, companies including Sainsbury's, Lloyds Bank, Iceland, Barclays, Unilever, Vodafone, and other big brands still rely on Teradata's on-prem systems for business decision-making as cloud-based systems are yet to meet their performance requirements, sources told The Register .
[1]
Support for Teradata's American hardware customers was transferred to IBM's mainframe hardware support teams on 1 July. Multiple sources told us Teradata's customer service field support team, which has shrunk in recent years, were mostly given their marching orders.
[2]
[3]
A relatively small bunch were retained after some customers complained, said one insider, but even they are now expected to leave the organisation at the end of this month.
"This is the entire on-premises estate for Teradata," said a senior source close to the company.
[4]
This includes machine upgrade and machine migration, as well as software support, such as upgrades or specific patches. "Now Teradata has decided to sell the problem to IBM," added one of the insiders.
It seems the deal may be multi-territory as The Register has seen documents indicating IBM is answering tickets on behalf of Teradata in Europe.
Teradata's systems are highly engineered and while replacing a power supply or a disk drive should be a simple process, if something more serious fails "it can be catastrophic," our source said.
[5]Can Teradata avoid being grounded by on-prem legacy? Actually it helps in avoiding nasty cloud costs, says CEO
[6]IBM settles £36m Direct Line insurance platform project lawsuit, after claiming Teradata tried to usurp its spot
[7]IBM insiders say CEO Arvind Krishna downplayed impact of email troubles, asked for a week to sort things out
[8]Age discrimination case against IBM leaks emails, docs via bad redaction
Observers fear a haemorrhage of the knowledge required to keep the unique Teradata systems up and running. "It's like you've got a team that looks after space rockets and a team that looks after Formula One cars. They're both ruinously complicated, but there is no crossover at all," one source said.
In a statement to The Register , the $1.8bn turnover
[10]
"Even when we outsource elements of the hardware support to reliable third parties, Teradata maintains the overall relationship with the customer and I can confirm that we continue to have hardware support expertise within the company for our on-premises customers."
Teradata declined the opportunity to deny hardware support was being transferred to IBM. Big Blue itself responded to us by saying we needed to ask Teradata for comment.
Teradata has been caught between conflicting demands of investors impatient to see it execute a cloud-first strategy, and customers uncertain about how highly optimised concurrent queries will work in the cloud. Cloud-native warehouses get around the concurrency problem by spinning up new warehouse instances, but that can leave users dealing with the cost of unplanned demand on cloud services.
[11]Speaking to The Register earlier this year , Teradata CEO Steve McMillan argued the company's heritage in on-prem systems offers users the ability to optimise workloads in the cloud for cost.
But many customers are keen to keep on-prem systems up and running for the time being, one source told us, as they weigh up their options for moving to the cloud with Teradata or another cloud system.
A person who asked to remain anonymous pointed out that while systems architects were trying to convince businesses to make the shift to the cloud, users of Teradata systems – business analysts who use data to inform important company decisions – were less keen. Moving to the cloud would be a "massive disruption."
"If you don't give them something that's at least as good – with a low disruption – to make the transition, then just forget it," our source said.
While many companies were making public announcements declaring their adoption of cloud-native data warehouse systems, they were keeping on-prem systems such as Teradata up and running for the time being.
As for the outsourcing agreement, the contract will likely reside within IBM Global Services, the part of the organisation that is being [12]spun out into a separately listed public entity known as [13]Kyndryl .
Late last week, IBM [14]confirmed the country managers who will run Kyndryl when it launches later this year. The business will be based around six units: cloud, applications, data and AI; security and resiliency; core enterprise and zCloud; network and edge; and digital workplace. ®
Get our [15]Tech Resources
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[5] https://www.theregister.com/2021/03/17/teradata_ceo_interview/
[6] https://www.theregister.com/2021/03/03/direct_line_ibm_insurance_b4c_lawsuit_settled/
[7] https://www.theregister.com/2021/07/08/ibm_arvind_email/
[8] https://www.theregister.com/2021/07/06/age_discrimination_ibm/
[9] https://s23.q4cdn.com/501457330/files/doc_financials/2020/q4/TDC-4Q20-Earnings-Release-(1).pdf
[10] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/storage&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YOhyof1FCEJh14NpRw0Y2gAAAEI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[11] https://www.theregister.com/2021/03/17/teradata_ceo_interview/
[12] https://www.theregister.com/2020/10/08/ibm_splits_off_services_division/
[13] https://www.theregister.com/2021/04/12/ibm_kyndryl/
[14] https://www.prnewswire.com/news-releases/kyndryl-unveils-new-operating-model-and-global-structure-301324071.html
[15] https://whitepapers.theregister.com/
The global data warehouse stalwart made its name with tightly integrated software and hardware systems sold as analytics "appliances", but in the last two years has shifted focus to its cloud platform following fierce competition from so-called cloud-native rivals including Snowflake, AWS, Microsoft, and Google.
In the UK alone, companies including Sainsbury's, Lloyds Bank, Iceland, Barclays, Unilever, Vodafone, and other big brands still rely on Teradata's on-prem systems for business decision-making as cloud-based systems are yet to meet their performance requirements, sources told The Register .
[1]
Support for Teradata's American hardware customers was transferred to IBM's mainframe hardware support teams on 1 July. Multiple sources told us Teradata's customer service field support team, which has shrunk in recent years, were mostly given their marching orders.
[2]
[3]
A relatively small bunch were retained after some customers complained, said one insider, but even they are now expected to leave the organisation at the end of this month.
"This is the entire on-premises estate for Teradata," said a senior source close to the company.
[4]
This includes machine upgrade and machine migration, as well as software support, such as upgrades or specific patches. "Now Teradata has decided to sell the problem to IBM," added one of the insiders.
It seems the deal may be multi-territory as The Register has seen documents indicating IBM is answering tickets on behalf of Teradata in Europe.
Teradata's systems are highly engineered and while replacing a power supply or a disk drive should be a simple process, if something more serious fails "it can be catastrophic," our source said.
[5]Can Teradata avoid being grounded by on-prem legacy? Actually it helps in avoiding nasty cloud costs, says CEO
[6]IBM settles £36m Direct Line insurance platform project lawsuit, after claiming Teradata tried to usurp its spot
[7]IBM insiders say CEO Arvind Krishna downplayed impact of email troubles, asked for a week to sort things out
[8]Age discrimination case against IBM leaks emails, docs via bad redaction
Observers fear a haemorrhage of the knowledge required to keep the unique Teradata systems up and running. "It's like you've got a team that looks after space rockets and a team that looks after Formula One cars. They're both ruinously complicated, but there is no crossover at all," one source said.
In a statement to The Register , the $1.8bn turnover
[9]PDF
company said: "These agreements are always confidential, so all we can say in response to your questions is: Teradata has always been a customer-centric organization and that perspective is a key consideration for all business decisions.[10]
"Even when we outsource elements of the hardware support to reliable third parties, Teradata maintains the overall relationship with the customer and I can confirm that we continue to have hardware support expertise within the company for our on-premises customers."
Teradata declined the opportunity to deny hardware support was being transferred to IBM. Big Blue itself responded to us by saying we needed to ask Teradata for comment.
Teradata has been caught between conflicting demands of investors impatient to see it execute a cloud-first strategy, and customers uncertain about how highly optimised concurrent queries will work in the cloud. Cloud-native warehouses get around the concurrency problem by spinning up new warehouse instances, but that can leave users dealing with the cost of unplanned demand on cloud services.
[11]Speaking to The Register earlier this year , Teradata CEO Steve McMillan argued the company's heritage in on-prem systems offers users the ability to optimise workloads in the cloud for cost.
But many customers are keen to keep on-prem systems up and running for the time being, one source told us, as they weigh up their options for moving to the cloud with Teradata or another cloud system.
A person who asked to remain anonymous pointed out that while systems architects were trying to convince businesses to make the shift to the cloud, users of Teradata systems – business analysts who use data to inform important company decisions – were less keen. Moving to the cloud would be a "massive disruption."
"If you don't give them something that's at least as good – with a low disruption – to make the transition, then just forget it," our source said.
While many companies were making public announcements declaring their adoption of cloud-native data warehouse systems, they were keeping on-prem systems such as Teradata up and running for the time being.
As for the outsourcing agreement, the contract will likely reside within IBM Global Services, the part of the organisation that is being [12]spun out into a separately listed public entity known as [13]Kyndryl .
Late last week, IBM [14]confirmed the country managers who will run Kyndryl when it launches later this year. The business will be based around six units: cloud, applications, data and AI; security and resiliency; core enterprise and zCloud; network and edge; and digital workplace. ®
Get our [15]Tech Resources
[1] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/storage&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YOhyof1FCEJh14NpRw0Y2gAAAEI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
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[5] https://www.theregister.com/2021/03/17/teradata_ceo_interview/
[6] https://www.theregister.com/2021/03/03/direct_line_ibm_insurance_b4c_lawsuit_settled/
[7] https://www.theregister.com/2021/07/08/ibm_arvind_email/
[8] https://www.theregister.com/2021/07/06/age_discrimination_ibm/
[9] https://s23.q4cdn.com/501457330/files/doc_financials/2020/q4/TDC-4Q20-Earnings-Release-(1).pdf
[10] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/storage&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YOhyof1FCEJh14NpRw0Y2gAAAEI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[11] https://www.theregister.com/2021/03/17/teradata_ceo_interview/
[12] https://www.theregister.com/2020/10/08/ibm_splits_off_services_division/
[13] https://www.theregister.com/2021/04/12/ibm_kyndryl/
[14] https://www.prnewswire.com/news-releases/kyndryl-unveils-new-operating-model-and-global-structure-301324071.html
[15] https://whitepapers.theregister.com/
GruntyMcPugh
I really don't get the 'Kyndryl' name, IBM have a name, and had a reputation, 'Kyndryl' sounds like cough mixture. On "outsourcing may not turn out too well" does it ever turn out well? I got TUPEd to big blue in an outsourcing deal which went sour, and then got cut loose to work on other accounts,... and the list dwindled, and many places started hiring their own IT and bringing it in house again.
Potemkine!
For the worried ones, you should drop a mail to IBM
John Miles
I'd go with [1]Snail Mail as likely to get there this year
[1] https://www.merriam-webster.com/dictionary/snail%20mail
Doctor Syntax
Nobody ever told them never to give the customer reason to review the market?
So to keep investors happy, they are upsetting their customers, the source of revenue.
From the looks of it Kyndryl is destined for a low involvement with hardware too so that outsourcing may not turn out too well for the clients either.