1. © 2014 IBM Corporation IBM System Networking Anthony Angell – Solution Sales BUE, North America This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 1

2. © 2014 IBM Corporation Agenda  Basics  SDN  Cloud Competition  Portfolio – building a configuration  Selling Converged Systems today This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 2

3. © 2014 IBM Corporation This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 3 What: Illudium Q-36 Explosive Space Modulator Why: Blow up Earth

4. © 2014 IBM Corporation “The Line” Core Networking  Monolithic  Entrenched  Proprietary  Expensive  Irreducible  Hardware dependencies  Single Vendor Market Domination Other ‘Core Networking like” products include IBM Mainframe and EMC VNX/Symmetrix Row/Rack Networking  Distributed  Rapid transition to Merchant Silicon  Pooled  Rapid software incursion  No significant hardware dependencies  Multi vendor, particularly converged Other “Row like” products include x86 servers and local storage This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 4

5. © 2014 IBM Corporation This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 5 Mark Andreessen: Founder – Netscape and Andreessen Horowitz

6. © 2014 IBM Corporation SDN – Software Eats Networking What:  Incorporated into client’s existing Hypervisor install base VMWare’s NSX Microsoft’s Windows Server with Hyper V OpenStack Neutron (formerly Quantum)*  Takes functionality from the network hardware and moves it to the Hypervisor Why:  Easier to administer  Feature addition at the speed of Software vs Hardware  Centralized Network control vs distributed  Logical vs physical. Resource Pool vs Discrete Allocation  Cap X reduction This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 6 * Not hypervisor based

7. We also update our bare metal impact analysis in EPS and find that lower OS pricing has materially lowered our central case "SDN translated" EPS to $1.67. A detailed price comparison of bare metal solutions with Cisco shows a large pricing gap that we believe will have to close for Cisco to maintain share,“ Excerpt from JP Morgan Cisco downgrade, 2Q 2014.

8. © 2014 IBM Corporation Converged Systems 8 What we’ve been selling Why clients are buying differently now

9. © 2014 IBM Corporation Converged Systems – what makes them different?  Three Sales in One Storage, Networking and Server components all have a sales cycle Every vendor has an advantage and a disadvantage in one of the three Sales tend to be lost in the blind spots  Not understanding the “disadvantage” space leads to incorrect configurations More than half the designs we see quoted have incorrect Network configs Most designs we see are sub-optimal vs. competition Workload differentiates Converged Systems – get specific  If you sell BAU clients will buy BAU – bad news unless you are the incumbent This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 9

10. © 2014 IBM Corporation The Cloud Conundrum The success of cloud within existing IT organizations could be measured by the reduction of both Employees and Cap X.  “New IT or No IT”  The truth about “non transferable” workloads.  The rise and rise of Shadow IT.  Talking points with your clients Premium priced hardware vs cloud Vendor lock in vs Open/Open Source. “The Wedge” “How long…” This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 10

11. © 2014 IBM Corporation Putting it All Together This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 11

12. © 2014 IBM Corporation Data Center Network Evolution (“No network in the POD”) Push the network boundary upstream Data Center Network (LAN|SAN) Began at the Server Edge … Interconnect Network Admin Data Center Network (LAN|SAN) Begins at the Chassis Edge … Chassis Level System Interconnect Module Chassis Level System Interconnect Module Aggregated Virtualized Host Ports (server admin) Network Admin Data Center Network (LAN|SAN) Begins at the POD Edge … Aggregated Virtualized Host Ports POD Level System Interconnect Fabric POD Level System Interconnect Fabric Interconnect Ancient History 10+ years Past 5 – 10 years NOW Network Interconnect 12

13. © 2014 IBM Corporation Chassis Ethernet – Step 1 This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 13 EN 2092 1G to servers 1G/10G uplinks Use Existing 1G network. Low performance spec– management/remote. SI 4093 10G to servers 10G/40G uplink Use Existing 10G network requires port aggregator functionality. Use Existing 10G network requires port aggregator vs switch limited uplink bandwidth. B22 FEX 10G to servers 10G uplink - limited EN 4093 10G to servers 10G/40G uplink Use Existing 10G network requires full switch functionality.

14. © 2014 IBM Corporation Chassis Ethernet - Considerations  Bandwidth What type of connectivity does the client need? Switch vs Port Aggregator How much outbound/intra-chassis bandwidth do they need…and why you should ask? What does their network look like today – vendor and models?  Mode Traditional Network mode – Layer 2/3 switching End Host Mode – chassis (or POD) appear to the upstream switch as a node Why it’s important  Key Features of Flex Networking Flexible Port Mapping – allows client to freely allocate bandwidth amongst ports Feature on Demand – allows client to “open” additional ports on their existing switch Chassis switches and port aggregators switch local chassis traffic (exception B22) This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 14

15. © 2014 IBM Corporation Flex System moves VMs faster than Cisco UCS 2.5X faster VM migration with Flex System compared to Cisco UCS due to 4.8X more backplane throughput with Flex System compared to Cisco UCS NEW: White paper IBM || BP || Client IBMBPClient Flex System Max. network flexibility Cisco UCS North / South networking only Higher throughput allows more transactions for business critical applications in cloud and big data environments. 15

16. © 2014 IBM Corporation This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 16 Landscape Changes

17. © 2014 IBM Corporation Chassis Fiber Channel (FC) – Step 2 This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 17 FC 3171 Pass-thru 8G to servers 8G uplinks Use SANs managed upstream that don’t need a FCF. Use Existing 8G networks w/ no upgrade plans. Qlogic networks. FC 3171 8Gb to HBA 8 Gb uplink FC 5022 8/16Gb to HBA 8/16Gb uplink Use Existing 8G SAN targeted for upgrade. 16Gb SANs. Brocade. Special Case: CN 4093 8Gb FC 10Gb Ethernet Flex ports Uses CNA

18. © 2014 IBM Corporation Chassis Fiber Channel - Considerations  8Gb vs 16GB Current state and future plans for FC SAN network? 16Gb is an advantage, if the client requires 16Gb. 16Gb is a disadvantage if priced against competition’s 8Gb solution– particularly UCS.  When to use converged (CN4093) vs native (FC 3171/5022) and why  Storage Constituents Talk to the storage teams – the requirement for Server HBAs for FC is unlikely to come from any other group – and it gives us a competitive advantage. What vendor are they using? In cases of Qlogic or Brocade we can provide single vendor technology – the competition can’t.  Cisco UCS does not offer 16Gb FC, native (non FCoE) FC or HBA SAN connectivity. This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 18

19. © 2014 IBM Corporation Multiple Chassis – Step 3 Any deal that involves two or more chassis needs a way to interconnect the chassis. If we do not architect the interconnect our competition will.  The System is incomplete without an Interconnect/Fabric.  If the System is sold correctly, clients will expect a recommendation on chassis interconnection.  The configuration used to connect to the client’s existing network should be your main area of focus – not the hardware.  Interconnects are just that – not a new network element. The Line This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 19

20. © 2014 IBM Corporation IBM Flex System Interconnect Fabric What is it?…  Simple Ethernet Fabric cluster  Loop free design with no spanning tree  Scalable multi-chassis, multi-rack interconnect fabric infrastructure Customer Importance…  Rapidly deploy additional chassis or racks – configure the Fabric once  Reduce networking management complexity without compromising performance – manage 1 device vs 20  95% 1 reduction in the number of networking devices required to manage a 9 chassis, 3 rack configuration  ZERO 2 down time for service upgrades  ZERO 3 additional Flex System CAPEX to implement – use existing SI4093 and G8264CS Flex System HW  Support for Ethernet, iSCSI and FCoE protocols  Proven interoperability with other vendors core network like Cisco and Juniper Delivering a simplified Fabric Infrastructure to accelerate deployment with optimum efficiency 1 1 G8264CS Switch vs 20 Devices (2 G8264CS’s and 18 SI4093’s) 2 master switch provides in service upgrades to all 18 devices 3 G8264CS and SI4093 are the only modules enabled for the fabric infrastructure

21. © 2014 IBM Corporation IBM Flex System Interconnect Fabric This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 21

22. © 2014 IBM Corporation Virtualization POD (it’s not trademarked) A clustered group of Flex Chassis using cutting edge transport and software interconnects designed for HPC-like performance with full SDN software support. Components:  G8332 Fabric connectors with the latest Broadcom Trident chipset.  SI4093 embedded aggregators Benefits:  40G fabric within the cluster – no other vendor offers  75% reduction in cabling, same bandwidth– 160G on 10G -16 cables, 4 on 40G  8332 will support VxLAN with a software upgrade – critical for SDN  With Flex Port Mapping the SI4093’s 40G ports are the same price as 4x10G This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 22 TM

23. © 2014 IBM Corporation SDN and Virtual Networking Aware Switch vSwitch VM vSwitch VM VXLAN Tunnel Overlay Network RackSwitch G8332 – VXLAN Gateway Non Overlay Network Benefits over Software based Gateway Line rate performance Does not require additional server resources of a soft gateway Simpler network design Technology support Supports SDN-VE in May 2014 Plan to integrate with VMware NSX and Microsoft in future “The Line” TM

24. © 2014 IBM Corporation Selling Converged and Networking Today This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 24 The days of selling discrete Networking, Servers and Storage are over. Client needs have changed Open vs Proprietary – why it matters more now Software decoupling from Hardware – what’s next? Building an aggregated system to run an overlay – changing philosophy Building a bridge to the future state now – this is becoming top priority The Line Converged Systems are not, and should not, be tied to any higher layer for Hardware or Software dependencies. Sell to what they have deployed above “The Line” and competitively below Clients are looking for direction as the market thrashes – provide it. Why vs What

25. © 2014 IBM Corporation This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 25

26. © 2014 IBM Corporation Appendix This educational material is intended for your use in selling. It is NOT a deliverable for your clients. 26

27. © 2014 IBM Corporation IBM System Networking Ethernet IBM RackSwitch G8264 10Gb scalable switch ideal for big data, cloud and optimized workloads Mainstream 10Gb Deployments 40Gb Aggregation Datacenter Consolidation Convergence Ethernet + FC IBM RackSwitch G8316 Cost efficient 40Gb Ethernet aggregation switch IBM RackSwitch G8264T High performance, cost effective RJ45 10Gb Solution IBM RackSwitch G8052 1Gb connectivity with standard10Gb uplinks IBM RackSwitch G8000 Entry level 1Gb switch with optional 10Gb uplinks IBM RackSwitch G8264CS 10Gb converged switch with flexible Ethernet and Fibre Channel ports IBM Flex System Fabric CN4093 10Gb integrated converged switch with full Fibre Channel fabric service IBM RackSwitch G8124E 10Gb switch with Virtual Fabric support IBM Flex System Fabric EN4093/R 10Gb scalable switch with support for stacking, partitioning, and FCoE Mainstream 1Gb Applications IBM Flex System Fabric EN2092 1Gb scalable switch with optional 10Gb uplinks IBM Flex System Fabric SI4093 System Interconnect Module Low cost end host mode, simple management, 10/40 Gb scalability IBM RackSwitch G7028 Affordable entry-level enterprise class 1Gb datacenter switch IBM RackSwitch G8332 40Gb Ethernet aggregation switch with support for up to 96 10Gb ports Expand business more easily with cost- effective enterprise-class networking Reduce big data I/O bottle necks with ultra- low latency & 2.56Tb performance Cisco Nexus B22 FEX Easy 10GbE connectivity to Cisco networks IBM Flex System EN4023 10Gb connectivity to Brocade VDX with flexible ports on demand IBM Flex System EN6131 High performance 40Gb connectivity with ultra low latency

28. © 2014 IBM Corporation EN2092 – 1Gb Int. & 1/10G Ext. Unmatched Ethernet Portfolio SI4093 – 10Gb Int. & 10/40G Ext. Simple Connectivity EN4093R – 10Gb Int. & 10/40G Ext. (Multi Modes: L2, L3, OpenFlow, Easy connect) CN4093 – 10Gb Int. & 10/40G Ext. – FCoE & low cost FC connectivity Lead Offerings - Differentiation & Value Flexible & Scalable * Only supports 2-port adapter, can not support all ports on a 4-port adapters Specific Needs - Offerings EN4091 – 10Gb Pass- Through* Cisco Nexus B22 Fabric Extender for IBM Flex System* IBM Flex System EN4023 10Gb Scalable Switch (Brocade) EN6131 – 40Gb Ethernet - Mellanox

29. © 2014 IBM Corporation Specific Needs - Ethernet Offerings Those requiring only 2-port connectivity on node* Needing dedicated 1-to-1 10Gb pipes upstream SI4093 provides more node ports Lowest acquisition cost 10Gb Ethernet module – but drastically increases external networking costs SI4093 can save you $18-52K per chassis on I/O costs (factor in trans & upstream network)** EN4091 10Gb Pass-through Total Ports 10Gb Downlinks 1/10Gb Uplinks Base System14 Cisco B22 Fabric Extender Provides full 40Gb end-to-end through the chassis Based on Mellanox technology Competitive advantage against Cisco and Dell EN6131 40Gb Switch Module EN4023 10G Scalable Switch For clients implementing with external Brocade VCS Ability to scale ports * Not supported with x222 Total Ports 40Gb Downlinks 40Gb Uplinks Base System1418 Those requiring only 2-port connectivity on node* Those only wanting an Ethernet offering from Cisco Requires upstream Nexus 5548/5596 or 6000 which provides all the management Total Ports 10Gb Downlinks 10Gb Uplinks Base System148 Total Ports 10Gb Downlinks 10Gb Uplinks 40Gb Uplinks Base System14100 Upgrade #128102 Upgrade #242142 IBM offers a unmatched portfolio of offerings!

30. © 2014 IBM Corporation Flexibility – Lower Cost of Ownership Scalability  Most vendors products support a set number of ports internal & external Example: Cisco UCS, HP and most Dell  IBM Features on Demand – buy upgrade license to turn on additional ports Example: X222 nodes, or nodes requiring 4-6 adapter ports HP and Dell users must by 2 nd or 3 rd pair of Ethernet modules => higher acquisition cost, more devices to manage and greater power consumption  Ability to reallocate ports Reallocate ports internal/external Trade off lower for higher bandwidth ports -10x1Gb for a 10GbE -4x10Gb for a single 40Gb  Advantage areas – clients that need A 4-port compute node – only base module - HP and Dell must sell 2x the modules - Cisco UCS can but increase oversubscription A 6-port compute node – only the base model - HP and Dell must sell 3x the modules - Cisco UCS can but increase oversubscription Flex System x222 is supported with the base 1Gb today but want 10Gb uplinks in future -IBM – Features on Demand Upgrade1 or 2 -HP and in most cases Dell will buy new switch 10Gb today but 40Gb uplinks in future -IBM – simple trade off 10Gb ports for 40Gb -Del or HP – limited to products that come w/ 40Gb SI4093 Total Ports 10Gb internal 10Gb external uplinks 40Gb External uplinks Base module14100 w/ Upgrade #128102 w/ Upgrade #242142 Supported on EN2092, SI4093, EN4093R & CN4093 Flexibility – Flexible Port Mapping

31. © 2014 IBM Corporation This educational material is intended for your use in selling. It is NOT a deliverable for your clients 31 This educational material is intended for your use in selling. It is NOT a deliverable for your clients. © 2014 IBM Corporation Embedded Reference

32. © 2014 IBM Corporation Compute node1GB Ethernet 10Gb EthernetConverged40Gb Ethernet FeaturesEN2092SI4093EN4093REN4023EN4091B22CN4093EN6131 Support 2-port adapter 1 Yes Support 4-port adapter 1 Yes No YesNo Support 6-port of 8- port adapter 1 NoYes No YesNo Support x222 NodeYes No Yes Flexible Port Mapping 2 Yes 3 YesNo Yes 3 No 1Gb uplinkYesOption NoOptionNo 10Gb uplinkOptionYes No 40Gb uplinkNoOptional No OptionalStandard FCoE TransitNoYes FC Break OutNo YesNo 1. Understanding compute node requirements & upstream bandwidth 1 Assumes two Ethernet modules in switch bay 1 and 2. 2 Ability to sign ports as required internal/external – allows use of x222 / 4-port adapters with out having to purchase upgrades. 3 Available with GA of IBM Networking OS 7.8. What adapters are you going to have installed in the compute nodes in your chassis? 1Gb, 10Gb, 40Gb, CNA (FCoE)? (Can answer more than one) 2-port, 4-port, or 6-ports (CN4058)? (Can answer more than one) What external links do you want coming out of the chassis? 1Gb, 10Gb, 40Gb, FCoE or FC? Do you plan to deploy only a partial chassis (having empty node bays)?

33. © 2014 IBM Corporation Compute node1GB Ethernet 10Gb EthernetConverged40Gb Ethernet FeaturesEN2092SI4093EN4093REN4023EN4091B22CN4093EN6131 Transparent Mode – No Change to upstream networking NoYesYes 1 NoYes Yes-requires Nexus Yes 1 No Transparent Mode – No Change to upstream networking but VLAN aware mode NoYesYes 1 NoYesNoYes 1 No Layer 2 NetworkingYesYes 3 Yes No Yes Layer 3 NetworkingYesNoYes No Yes OpenFlow ModeNo YesNo Upstream Nexus 2KYes NoYes Upstream Nexus 5/6KYes Upstream Nexus 7KYes NoYes Managed by Cisco NexusNo YesNo Managed by Brocade VDXNo YesNo 2. Understand what the client network requirements (chassis & upstream) 1 The EN4093R/CN4093 can be configured in easy connect mode – requires configuration but once done it is easy to replicate and provides flexibility for future. 2 The SI4093 can be more cost effective and not require changes in your network. 3 The SI4093 has limited Layer 2 feature support Want clear separation of System Admin and Network Admin = Transparency Want integrated Layer 2 or Layer 3 networking? Want investment protection for Software defined networking (OpenFlow)? What upstream Cisco Nexus might they want to plug into? Do they want managed specifically by Cisco Nexus or Brocade VDX network?

34. © 2014 IBM Corporation Compute node1GB Ethernet 10Gb EthernetConverged40Gb Ethernet FeaturesEN2092SI4093EN4093REN4023EN4091B22CN4093EN6131 Build POD – single IPNoYes 4 NoYes No Traditional Stacking up to 8No YesNo Yes 5 Keep VLAN traffic in the chassisYes No Yes vNIC2 SupportYes UFP SupportNo2Q14 6 YesNo YesNo VMready – VM awareYes2Q14 6 YesNo YesNo Switch PartitioningNoYes No YesNo Link AggregationNo YesNo Yes 3. Other possible features to consider 4 Similar to stacking but requires external Top of Rack switches (SI4093+G8264CS, EN4023+Brocade VDX, B22+ Cisco Nexus) 5 Support in Hybrid stack 2 x CN4093 + 2 to 6 EN4093R 6 Support with release of GA5 – by end of 2Q 2014 Do you want to build POD/cluster with single IP address? Do you have environment where VM’s or nodes might co exist in same chassis? Are you looking to implement vNIC’s for your x86 compute nodes? IBM has basic vNIC2 or more advanced UFP. Are you interested in have a network that is VM aware and can help simplify VM deployment and mobility? Do you require multi-tenancy? (Switch partitioning) Clients like Cisco vPC and interested in link aggregation for performance and availability?

35. © 2014 IBM Corporation Decision Tree: Understanding clients requirements Vendor Lock in (i.e. Cisco, Juniper etc) Open to alternatives that provide Value (i.e. All IBM) SI4093 Cost & Simplicity FCoE Converged Understand Clients flexibility and environment Simple Ethernet or Converged Cost or Flexibility Flexibility modes EN4093R Easy connect Integrated FC from chassis Integrated FC or FCoE at TOR FCoE Transit to TOR Ethernet only Cost & Simplicity FCoE Converged Simply Ethernet or Converged Cost or Flexibility Flexibility Modes Networking or SDN EN4093R L2,L3 or OpenFlow Integrated FC from chassis Integrated FC or FCoE at TOR FCoE Transit to TOR SI4093 Ethernet only SI4093 TOR G8264 = 10Gb G8316/G8332 = 40Gb TOR G8264 = 10Gb G8316/G8332 = 40Gb CN4093 TOR G8264CS CN4093 Easy Connect SI4093 to Brocade Or Cisco EN6131 SI4093 EN4093 CN4093 TOR Legend EN6131 Full 40GbE TOR G8316 = 40Gb B22 FEX Cisco or nothing EN4023 Brocade VCS

36. © 2014 IBM Corporation Why Convergence versus Separate LAN & SAN switching?  Clients can see major acquisition cost savings through convergence Some servers now include 10Gb LAN on Motherboard (LOM) which provide significant savings Other servers with out the LOM can also see savings  Clients can see savings by reducing the number of FC SAN switch ports required The G8264CS can be up to a 25% savings, compared to separate LAN and SAN switching Clients can see further savings by leveraging a transit switch, allowing for more servers per port IBM Web pricing * Emulex 8Gb FC Dual-port HBA for IBM System x (42D0494) ** Emulex Embedded VFA III FCoE/iSCSI License for IBM System x (90Y5178) *** Emulex Dual Port 10GbE SFP+ VFA III for IBM System x (95Y3762) **** Emulex VFA III FCoE/iSCSI License for IBM System x (95Y3760) ***** G8264 plus IBM® System Storage® SAN48B-5 Separate LAN & SANConverged Solution I/O Comparison10GbE standard 8Gb FC = $1,849 ** 10GbE Standard CNA functionality $99** Separate LAN & SANConverged Solution I/O Comparison10GbE $629*** 8Gb FC = $1,849 ** 10GbE adapter $629*** CNA functionality $829**** 36