ESG Blogs

There is a lot of hype around hyperconverged infrastructure (HCI). All the big vendors and a number of lesser-known smaller ones are in the game. Dell EMC has doubled down on its HCI portfolio investments; NetApp is entering the market leveraging its Solidfire technology; HPE is investing in growing its SimpliVity line; Cisco acquired Springpath so it could offer its own line, but it also partners with Nutanix, HPE and just about everyone else! Speaking of Nutanix, it was a category pioneer (along with SimpliVity) and its Dell EMC branded business is still growing, even though Dell EMC has somewhat competing products with VxRack and VxRail (the 3 HCI products serve different use cases - a topic for another blog!). Nutanix is also doing a healthy business through Lenovo and its channel partners and it has an agreement with IBM to offer its HCI on Power systems. Lesser-known (but fast growing) Pivot3 just announced 50% growth in bookings! Hitachi Vantara has a product it is also leveraging for Lumada IoT, and VMware sells vSAN for HCI use cases. I'm still just scratching the surface- I know I've left some vendors out - it's a long list!

It was surreal flying into Vegas on Monday to attend NetApp Insight at the Mandalay Bay hotel. NetApp this week had to deal with something no company ever expects to or should have to deal with: a mass shooting at the venue where their event was to kick off the next morning.  

Last week Mark Peters and I attended Hitachi's first ever user conference, Next. While the conference had the usual product and solution announcements one would expect at such an event, the biggest news was the reorganization of multiple independent divisions and companies within the Hitachi umbrella to create the new Hitachi Vantara.

Hitachi Vantara brings together HDS, Hitachi Insights Group, and Pentaho into a single organization. The new structure gives the Vantara team an opportunity to focus on a different competitive landscape than they faced separately – and in a much stronger position. Longer term, HDS will no longer be duking it out with Dell EMC, NetApp, IBM, and HPE for the (shrinking) data center infrastructure dollar. Pentaho won’t be evaluated head-to-head with Qlik. And Lumada won’t just be evaluated against GE Predix. They will be able to knit together the infrastructure, analytics, and insights into an end-to-end solution that reaches from the edge (even to sensors, leveraging the broader Hitachi organization) to the data center. 

As I said in my pre-VMworld blog - I have a love/hate relationship with the conference. It didn't disappoint - it was a wild and crazy few days and a veritable who's who of the tech industry. There were plenty of announcements from VMware (most notably its efforts with AWS and Google, as well as vSAN momentum), partners like Pivot3 (new partner programs and NVMe-based solutions), Dell EMC (new VxRack and Rail solutions), Lenovo (ThinkAgile VX Series and cloud reference architecture) - I think I could go on with this list for a very long time!

VMworld is coming at us fast. I always approach VMworld with mixed feelings. First, I love it because it gives me the opportunity to talk with lots of people on the vendor and IT professional fronts. It's one of the best and biggest trade shows I attend. It is a veritable who's who in the IT technology infrastructure world, and for both vendors and those that manage IT infrastructure. But I hate it because it marks the end of summer. It's back-to-school season, and even though I don't have kids, I somehow still think of back-to-school season as the end of fun times and the beginning of work - and it turns out it's the same in the tech world! This is the beginning of fall trade show season, which means less time at the beach, more time on the road, and the beginning of cooler weather. But enough of that - let's talk about my VMworld expectations and why I am really looking forward to the show. 

This week Nutanix kicks off .NEXT, its annual user conference. I'm looking forward to it because it provides such a great opportunity to catch up with many Nutanix customers, partners, and executives in a very short time. I have to be careful not to get lost in the echo chamber though—when I attended my first .NEXT last year, it was a bit surreal. It was like being at a cult meeting—Nutanix users I spoke with were seriously enthusiastic about the Nutanix experience!

It’s no secret that NetApp has had a tough go of things these past few years, but I’ve just returned from its annual industry analyst meeting and it was clear to me during this full day discussion that NetApp today is not the NetApp of yesterday. In our internal discussions these past few years, we acknowledged that it had an excellent technology foundation, had made some good acquisitions but executed bad integrations, and needed a significant overhaul - a transformation, if you will - including getting beyond selling storage boxes. For example: up leveling the discussion rather than selling speeds and feeds; expanding the portfolio beyond storage to deliver more value; ridding itself of the antibodies that prevented acquired technology from thriving; and being bold(er) in its marketing. NetApp was famous for technology innovations it never told anyone about (while other, bolder vendors claimed first mover advantage!) In the past two years, it has transformed to the point that the discussions we are having with it today are completely different than those we have had in the past. It is certainly not your father’s NetApp!

The changes I've witnessed at EMC over the years, first as a competitor, then as an employee, and now as an analyst, have been profound. I put 11 years of my heart and soul into the company, joining when there were less than 4,000 employees and leaving when there were tens of thousands. And even though I'd been gone for about 8 years when Dell acquired EMC, and even though the joining of these two behemoths makes tremendous sense from a business standpoint, it was still somewhat bittersweet to see it happen. But it had to happen. The competitive environment demanded it. Convergence is the way of the future. Dell's server business and EMC's storage business pair beautifully--add VMware in the mix and and you have all the infrastructure pieces to put together a next-gen, software-defined data center. There may be some weak spots, but the overall portfolio is tough to beat. 

That was fast! HPE only announced it planned to acquire hyperconverged software vendor SimpliVity on January 17, and it closed exactly one month later, on February 17. Why the hurry? Because they need to!

You can't let a market get away from you, and hyperconverged is a fast growing market. When ESG surveyed IT managers responsible for cloud infrastructure decisions, we learned that hyperconverged systems are playing a huge role in IT's plans. When ESG surveyed IT managers responsible for cloud infrastructure, we found that 85% of them are using or plan to adopt hyperconverged solutions. 

We saw strong adoption of both converged and hyerconverged systems in 2016—and we expect that to continue into 2017. While converged systems have been out for a while and have strong market penetration, expect hyperconverged to come on strong this year as these systems continue to mature for tier-1 workload support. The strong performance of the Nutanix IPO certainly drove some attention on the hyperconverged side, as did the recent HPE buyout of SimpliVity.