Constellation Insights

Why the looming net neutrality reversal could fail: Federal Communications Commission Chairman Ajit Pai will publicly release his proposal to overturn the Obama administration-era rules regarding Internet regulation known as net neutrality on Wedesday. Net neutrality bars ISPs from favoring legal Internet traffic based on payments or other considerations; opponents like Pai call the rules an anticompetitive overreach, while proponents say they protect consumers.

In advance of his plan's formal release, Pai published an op-ed in the Wall Street Journal laying out his now-familiar case. Here are some key excerpts:

In the Telecommunications Act of 1996, the government called for an internet “unfettered by Federal or State regulation.” The result of that fateful decision was the greatest free-market success story in history.

Encouraged by light-touch regulation, private companies invested over $1.5 trillion in nearly two decades to build out American communications networks. Without having to ask anyone’s permission, innovators everywhere used the internet’s open platform to start companies that have transformed how billions of people live and work.

But that changed in 2014. Just days after a poor midterm election result, President Obama publicly pressured the Federal Communications Commission to reject the longstanding consensus on a market-based approach to the internet. He instead urged the agency to impose upon internet service providers a creaky regulatory framework called “Title II,” which was designed in the 1930s to tame the Ma Bell telephone monopoly.

This burdensome regulation has failed consumers and businesses alike. In the two years after the FCC’s decision, broadband network investment dropped more than 5.6%—the first time a decline has happened outside of a recession. If the current rules are left in place, millions of Americans who are on the wrong side of the digital divide would have to wait years to get more broadband.

POV: The FCC's Republican majority board is set to vote on the proposal December 14, and given the boards's partisan makeup, it's expected to pass. However, opponents are not just making noises of protest in advance of the vote; they also have quite a hole card to play. Federal law states that decisions by agencies such as the FCC can be overturned if an appeals court found they were made in an "arbitrary" or "capricious" manner.

Given that the current rules came into effect only after many years of heated debate and legal wrangling, there could be a case for terming the FCC's upcoming vote as arbitrary or capricious. It's also possible that Congress could intervene in the fray, passing a bill that could find a compromise set of rules, but in the current political climate that outcome seems less likely. Only one thing is for sure: The net neutrality debate is far from over, looming repeal or not.

HPE brings AI to the storage tier: Earlier this year, Hewlett-Packard Enterprise spent $1 billion to aquire Nimble Storage, maker of flash-based storage products, with an eye on complementing its 3PAR storage family. But HPE wanted more than Nimble's hardware; for its money, the company also picked up InfoSight, a predictive analytics software platform geared for data center performance and proactive maintenance.

Now HPE has added support for InfoSight in 3PAR and believes the combination will provide a compelling differentiator in a crowded market. Here are the key details from HPE's announcement:

HPE InfoSight lays the groundwork for an autonomous data center with the new AI recommendation engine. Building on its predictive capabilities, HPE InfoSight now preemptively advises IT how to avoid issues, improve performance, and optimize available resources. The recommendations are based on advanced machine learning that leverages almost a decade of data science expertise and rich telemetry collected from more than 10,000 HPE Nimble Storage customers.

POV: The first release will provide root-cause analysis of problems between storage mediums and host VMs; a portal that displays performance, capacity, health and other information from 3PAR arrays; and predictive analysis for spotting anomalies and potential problems.

HPE is delivering Infosight to Nimble and 3PAR storage customers with active support contracts at no additional cost, beginning in January. InfoSight was Nimble's proverbial secret sauce prior to the acquisition, and has been collecting customer data for roughly a decade. Now HPE can map over that system intelligence and historical analysis to 3PAR system management, although it will take time for HPE to collect large amounts of 3PAR-specific data for use with InfoSight. Nonetheless, it has to start somewhere. One would imagine InfoSight will get applied to other members of HPE's extensive storage family over time as well.

Capital One gets into the container game with Critical Stack: While still by and large a bank, Capital One has designs on becoming something more, including a trusted technology provider to companies in highly regulated industries like its own. To that end, Capital One has launched a beta for Critical Stack, a container orchestration system derived from its 2016 acquisition of a company of the same name:

The use of containers and microservices is on the rise as more organizations recognize the automation, speed and cost savings benefits of modern computing infrastructure.

For large enterprises, especially those in highly regulated industries, security and compliance considerations are paramount. Critical Stack, powered by Capital One, was designed to help enterprises more fully automate compliance and security controls, as well as orchestrate streamlined deployment and configuration of apps and infrastructure in the cloud.

POV: Capital One has been a pace-setter among large banks in recent years on the technology innovation front, moving many of its systems to Amazon Web Services. The beta release of Critical Stack will eventually lead to a commercial product; how successful it is remains to be seen. Critical Stack is compatible with Kubernetes, the Google-backed container orchestration system that has gained a great deal of momentum in recent times, so much so that compatibility is less of a choice than a must.