Storage Soup

September 6, 2017  2:09 PM

HPE storage more Nimble after $1.2 billion buy

Dave Raffo Dave Raffo Profile: Dave Raffo
3PAR, Nimble Storage

HPE storage sales received a boost last quarter from its $1.2 bilion Nimble Storage acquisition.

HPE did not break out its total storage revenue by product, or even give a total amount except to say HPE storage revenue grew 11% over last year on the strength of the Nimble systems. But HPE had no revenue from Nimble last year, so the comparison isn’t exactly fair. It’s unlikely that HPE storage grew organically compared to its 2016 portfolio. Revenue from 3PAR arrays – its top selling storage platform — declined nine percent year-over-year. HPE CEO Meg Whitman attributed the decline to “a more competitive market in the U.S.”

HPE’s all-flash revenue grew 30% year-over-year, again benefiting from Nimble flash arrays that were not part of HPE a year ago. All-flash revenue increased six percent organically over HPE’s 2016 platforms, a modest gain compared to competitors’ year-over-year all-flash increases.

Nimble at least gives HPE storage prospects a reason for optimism. Whitman said Nimble Storage exceeded revenue and profit plans for the quarter. She pointed to Nimble and 3PAR as a one-two HPE storage punch that the vendor has lacked. Nimble mostly sells into midrange shops while 3PAR meets the high-end of the midrange and low end of the enterprise. 3PAR has been the vendor’s flagship storage platform since its $2.35 billion acquisition in 2010.

“We are excited now about our storage portfolio,” Whitman said. “3PAR plus Nimble, we get incremental scale, we get InfoSight, which is AI for the datacenter, and I think one plus one here is going to equal more than two. We’re really pleased.”

Whitman teased HPE’s plans to extend Nimble’s predictive analytics across the storage portfolio.

“We are incorporating Nimble’s InfoSight predictive analytics technology that uses machine learning to predict and resolve performance issues across our storage portfolio,” she said as an example of how HPE is embracing artificial intelligence.

Whitman plans to collapse the HPE storage platforms. She said HPE will combine the Nimble and 3PAR research and development teams as well as sales teams. The goal is to go after customers moving to flash storage.

“The all-flash segment in the market is growing,” she said. “And you will recall that only about 10 percent of datacenters have moved to all-flash. So there is a lot of running room there and we are a leader in that marketplace and we aim to continue that trend.”

Whitman said HPE is also starting to see results of its $650 million acquisition of hyper-converged pioneer Simplivity in January. She hyper-converged infrastructure revenue tripled over 2016, although admittedly HPE’s HCI revenue was “a small base” a year ago.

“Hyper-converged is core to our strategy of making hybrid IT simple for our customers,” Whitman said. “Simplivity has made a difference.”

September 6, 2017  1:40 PM

BackupAssist CryptoSafeGuard aids ransomware backup strategy

Sonia Lelii Sonia Lelii Profile: Sonia Lelii

Windows data protection specialist BackupAssist is the latest vendor to provide a capability that helps combat ransomware.

The Australia-based company recently launched CryptoSafeGuard, part of its BackupAssist data protection software for SMBs. The application includes CryptoSafeGuard Detector and CryptoSafeGuard Protector for the ransomware backup strategy.

The technology works with existing anti-malware software.

“We are an added layer to anti-malware,” said Linus Chang, CEO of BackupAssist. “We don’t replace it. We complement it. This protects the on-premises backup. We inspect data and file names and see the changes from ransomware attacks. After we detect something, we go in lockdown mode and preserve the clean backup. Then we alert the administrator.”

Ransomware is malware that keeps customers’ data hostage for an extortion fee. It is among the greatest security threats to businesses and backup has been a key ransomware protection tool. But the viruses are adapting to traditional backup processes.

CryptoSafeGuard scans and detects suspicious activity in source files that can be related to ransomware and then sends alerts via a text message or email and blocks backup jobs from continue to run. All backup jobs are blocked until the alert has been resolved as part of the ransomware backup strategy.

The CryptoSafeGuard Protector layer switches on when the backup job starts to run. It operates on the driver level to monitor existing backups and prevents suspicious processes from infecting the backups. This allows only BackupAssist to create, delete or update data in backups. The CryptoSafeGuard Detector does a “hierarchical threat scan” when a backup job begins to ensure the backed up data is clean, and blocks backup jobs if an infection is detected. This prevents the infection from spreading to backup data.

The new function is available with BackupAssist 10.1 for local file systems and basic partitioned volumes in Microsoft Hyper-V environments. Dynamic partitioned volumes, such as striping and spanning, are not scanned. Neither is Microsoft SQL Server.

‘Reliable way to get back to a known good copy’

Michael Osterman, president of Osterman Research, Inc., said BackupAssist is using snapshot technology to roll back to a good backup copy as part of the vendor’s ransomware backup strategy.

“Except in rare cases, there is no true recovery from ransomware,” Osterman said. “This is a very reliable way to get back to a known good copy. This is a second-best way to protect against ransomware. The primary way is to prevent it in the first place.

Chang said some of the ransomware attacks in Australia have targeted the servers and the backup software on the systems. Also, small businesses have been hit with ransomware attacks. Just several months ago, a small automotive company had to pay $8,000 to get its data back because its backups were destroyed. Another small company was hit via its cloud-file sharing Dropbox software and that affected other people connected to the file-sharing application.

“One of his clients received a doggie email,” Chang said. “They clicked on the email and it infected their computer. He was coaching eight different businesses and everyone else got corrupted.”

September 6, 2017  7:32 AM

Elastifile grabs $16M to stretch sales staff

Dave Raffo Dave Raffo Profile: Dave Raffo

Startup Elastifile, which sells a distributed file system that spans flash and cloud storage tiers, picked up $16 million in funding today. The startup also gained a new strategic investor in Western Digital.

Western Digital led the round, which Elastifile CEO and founder Amir Aharoni calls an extension of the B round the startup closed in mid-2016. Elastifile now has more than $65 million in total funding.

Elastifile Cloud File System (ECFS) runs on-premises on flash storage, and uses its CloudConnect feature to store and manage data on public clouds.

Aharoni describles ECFS as a “cross-cloud data fabric.” The goal is to run hot data on flash and colder data in the cloud.

“We don’t believe everybody will move 100 percent into the public cloud, but they want those public clouds to be an agile extension of their IT infrastructure,” Aharoni said. “Managing enterprise data in such environments is a complex task. You have to mobilize the data, and make sure it is available on premises and in the cloud. Our core value is to take data from silos and share it.”

Although venture firms CE Ventures, Lightspeed Venture Partners and Battery Ventures have invested in Elastifile, it has strongly courted strategic investors. Dell (through EMC), Cisco and Lenovo are among early investors. EMC – before the Dell merger – took part in Elastifile’s first funding round in 2014. Elastifile founder and CTO Shahar Frank also founded all-flash array startup XtremIO, which EMC acquired in 2012.

“EMC believed in our vision from the early days,” Aharoni said.

He pointed out that Western Digital has been an active investor and acquirer of storage companies, particularly in the flash market.

Aharoni said Elastifile will use the funding mostly to bulk up its sales team. The vendor has about 40 customers and Aharoni said the funding will help it grow headcount from 85 to around 100.

Elastifile sells its software through subscriptions, but also has server vendor partners who resell it and channel partners who bundle it on appliances.

“We need to do two things now,” Aharoni said. “First we have to build our sales organization beyond the early deals we have done. The majority of investment will go towards go-to-market and channel sales. And then we also still have a lot to do on the research and development side on our product.”

Elastifile has headquarters in Israel with its sales team based in Santa Clara, California.

September 5, 2017  7:40 AM

Nutanix revenue jumps as competition grows

Dave Raffo Dave Raffo Profile: Dave Raffo

Hyper-converged pioneer Nutanix grew revenue 72% in its first year as a public company.

Nutanix revenue grew to $767 million during a span in which competition intensified. Dell EMC, Hewlett Packard Enterprise and Cisco increased their investment in hyper-converged infrastructure (HCI) appliances, and VMware’s vSAN hyper-converged software matured and sales spiked.

Nutanix, which completed its initial public offering Sept. 30, 2016, reported its fiscal fourth-quarter earnings last week. Nutanix revenue of $226.1 million for the quarter represented a 62% increase over the same quarter last year.

As the Nutanix revenue increases, the competition keeps getting fiercer. Cisco last month acquired its HCI software partner Springpath to give it greater control over development of its HyperFlex appliance. NetApp HCI is due to launch by year’s end, and Lenovo last week launched a new vSAN-powered branded HCI appliance (Lenovo also sells appliances with Nutanix software).

Nutanix CEO Dheeraj Pandey said hardware vendors can only go so far in taking hyper-convergence to the next step: hybrid cloud.

“I think [Cisco] and HPE and NetApp are still playing a hardware game in HCI,” he said on the Nutanix earnings call. “I think the real game that’s being played is in pure software, about the entire opening system itself.”

Pandey maintains hyper-convergence is a stepping stone towards building enterprise clouds. He also claims Nutanix’s Acropolis services and Prism management software make it one of three vendors that can provide the full stack for a hybrid cloud. Microsoft and VMware are the others.

“We’ve always had this fundamental view that hyper-convergence is not a destination, it’s a milestone in the journey for a true cloud experience,” Pandey said. “It’s not about software-defined storage alone, it’s also about hypervisor software-defined networking, security, automation, operations, and systems management and also migration.”

Nutanix forecast revenues of between $240 and $250 million for this quarter. That compares to $167 million for the same quarter in 2016.

The flip side of the Nutanix revenue growth is widening losses. It lost $458 million for the past fiscal year, compared to $170 million over the previous year. Nutanix lost $91 million in the fourth quarter, nearly double its $50 million in losses for that quarter in the previous year.

With $350 million in cash and investments, Nutanix can sustain losses for now but won’t be able to remain in pure growth mode for long.

Other highlights from the quarter:

  • Nutanix added 875 customers last quarter and 3,300 for the last year, for a total of 7,051. It closed 43 deals of $1 million or more, including an insurance company with more than $2 million in billings.
  • Adoption of Nutanix AHV hypervisor increased 75% from the previous year.
  • Virtual desktop infrastructure, an early HCI staple, came in at the lowest percentage of deals in the vendor’s history.

August 31, 2017  10:54 AM

VMworld 2017 Notes: Dell favors storage R&D over M&A

Dave Raffo Dave Raffo Profile: Dave Raffo
Dell EMC, michael dell

LAS VEGAS — Before their merger, EMC and Dell were active buyers of storage companies. In the past year, neither has made an acquisition. That’s understandable, considering the price that Dell paid for EMC and the monster transition the combined company has gone through over the past year.

When I saw Michael Dell at VMWorld 2017, I asked him if we can expect to see Dell EMC start buying storage companies again. His answer is bad news for storage startups looking to be bought.

“We have a lot of storage. We don’ need more storage,” Dell said.

Translation: we just spent more than $60 billion on the biggest storage company in the world, and you expect us to buy more?

He instead talked about how Dell EMC is spending heavily on R&D, indicating it will look to build rather than buy. But historically EMC and Dell preferred buying their storage platforms rather than building their own.

“If we need any more storage, we’ll get it,” Dell said.

Veeam Software open to acquiring startups

Speaking of acquisitions, Veeam Software CEO Peter McKay said the backup vendor could get into the game for the first time in 2018. McKay said his profitable company now has the money and the executive team needed to make and integrate small acquisitions.

“It will be part of our strategy for 2018,” McKay said. “We have a sizeable war chest of cash. I think we’re ready for it now. Everything we’ve done until this point has been organic growth. Our goal now is to add inorganic growth to the mix without affecting overall growth. We want to scale to $2 billion or $3 billion in revenue, organically or inorganically.”

McKay said Veeam has invested in a few startups. They include N2W, which makes data protection software for Amazon Web Services EC2. “We’re looking mostly for add-ons,” he said of Veeam’s acquisition and investment strategy.

Rubrik takes home best of VMWorld 2017, scales up advisory board

Besides winning the official Best of  VMWorld 2017 award for its Alta secondary storage product, startup Rubrik also scored the unofficial “Best Marketing Gimmick” award for the show. Rubrik introduced its newest investor and board adviser, Kevin Durant, and brought him onto the VMworld 2017 expo show floor to sign autographs for star-stuck attendees.

At 6-foot-9, Durant is probably the tallest man to invest in a Silicon Valley company and he’s the only man with an NBA championship ring to put money into a storage company. But outside of name recognition—which startups can always use – how much can Durant do for Rubrik?

When USA Today asked the Golden State Warriors start about his interest in tech companies, Durant said: “Being in Silicon Valley, I play in front of (tech executives) and run into them at restaurants.”

Durant has also invested in on-demand delivery service startup Posmates and mobile investment platform company Acorns.

vSAN reaches adulthood

There was no major vSAN news at VMworld 2017, but lots of talk about the technology. That’s a sign that vSAN has matured from concept to a central data center tool. Over the past few VMWorlds, VMware concentrating on introducing its new hyper-converged software and then making product upgrades adding key features missing from early versions. Now the focus is largely on how people are using it now, mainly as a replacement from some or all of their traditional storage systems.

VMware did add an HCI Acceleration Kit at the show, a move designed to make it easier to use vSAN in remote and branch offices.

VMware’s goal for vSAN is to give IT generalists greater control over storage for their virtual machines.

“They’ve taken on the storage,” Lee Caswell, VMware’s VP of storage products, said of the generalists. “We think they can take on backup and data protection, and they can take on files, too. This is a massive data consolidation play.”

VMware is also working on adding support for Kubernetes and Docker Swarm container orchestrations with the open source “Project Hatchway” initiative.  The Hatchway goal is to allow developers to use storage better, making features such as snapshots, cloning, encryption, deduplication and compression available at the container volume level.

August 25, 2017  6:53 AM

Pure Storage CEO swap: Dietzen out, Giancarlo in

Dave Raffo Dave Raffo Profile: Dave Raffo
Pure Storage

Pure Storage CEO Scott Dietzen resigned unexpectedly Thursday, as the all-flash pioneer named former Cisco executive Charlie Giancarlo its new leader.

Dietzen will stay at Pure as chairman, although his exact role has not been determined. Dietzen said the CEO change was his idea, and there is no reason to suspect he was pushed out. The move was disclosed during Pure’s earnings report, which beat expectations for revenue growth.

As Pure Storage CEO, Dietzen built the flash vendor up to a projected $1 billion in revenue for 2017, close to 1,900 employees, and 3,700 customers.

“This was my call,” Dietzen said on the Pure earnings call. “I had a wonderful run, thanks to an extraordinarily gifted team. I’ve been in the job seven years and we have done some great things. And as I look to the road ahead for Pure, I felt we needed a different class of experience in operating at scale.”

Dietzen said he expected a search for his successor as Pure Storage CEO to take longer than it did, but “Charlie came to the top quickly. Charlie has phenomenal experience operating at scale having been part of Cisco when it went from $1 billion to well over $40 billion in revenues. And he’s an entrepreneur, having built a start-up, having participated in hyper-growth at Cisco, having been on the boards of great companies like ServiceNow and Arista through their growth phase. So, I think he is exactly the right leader at the right time.”

Former Pure Storage CEO Scott Dietzen

Scott Dietzen

On his blog, Dietzen called the choice to step down “without a doubt, the hardest decision I’ve made in my career.”

Giancarlo did not tip his hand on his plans as the Pure Storage CEO. He made a statement at the start of the earnings call but did not take questions.

“I have considered many CEO opportunities over the past couple of years,” Giancarlo said. “What inspired me about the Pure vision was the opportunity to contribute to build a great multibillion-dollar and independent public company, which has the opportunity to become the global leader in data platforms. I expect to do a great deal of listening in these next few weeks and months. While I will not be taking questions on today’s call, I look forward to sharing details about my observations and priorities in the next earnings call.”

Giancarlo has spent more than 30 years as an executive and director at IT vendors, mostly with networking and telecom-related companies. Most notably, he worked at Cisco from 1994-2008 as executive vice president, chief development officer and president of its Linksys division.

Giancarlo was considered a candidate to replace John Chambers as Cisco CEO but he left in 2008 after Chambers said he intended to stick around for years. Chambers stayed on as CEO until 2015, turning the position over to Chuck Robbins.

After leaving Cisco, Giancarlo became interim CEO at telecom vendor Avaya for six months in 2008 and remains on Avaya’s board. He has been a managing director at private equity firm Silver Lake Partners since 2008, and sits on the boards of Accenture, Arista Networks, Attivo Networks and ServiceNow. Before joining Cisco, he founded Telecom Systems and Adaptive Corp., and went to Cisco from Ethernet switching company Kalpana through acquisition.

Pure Storage CEO swap follows positive revenue quarter

Pure’s revenue of $224.5 million last quarter grew 38% from last year and came in near the high point of its guidance. Pure executives said they remain on track for $1 billion in revenue for the year and they expect the fourth quarter of 2017 to be their first profitable quarter. Pure still has a ways to go on profit, however, after losing $62 million last quarter.

Besides trying to achieve profitability, Giancarlo will face other challenges as Pure transforms from startup to a large storage company. While Pure rode a flash wave that has taken over networked storage, it now faces another set of disruptors that threaten all storage vendors. These include the cloud, hyper-converged infrastructure and software-defined storage.

Emerging storage technologies pose challenges to new Pure boss

Pure’s cloud strategy is to sell the underlying storage for cloud providers, and to help enterprises build private clouds and connect their on-premises storage to public clouds in hybrid setups.

Pure claims more than 600 cloud providers as customers, contributing more than one-quarter of its revenue. Dietzen said Pure is also working on adding the capability to allow enterprise customers to stream applications between on-premises arrays and public clouds.

“Pure is delivering the data platform for the cloud era,” Dietzen said.

Dietzen brushed off the threat of hyper-convergence, saying hyper-converged appliances address different types of use cases than Pure’s all-flash arrays. He said for now, there is plenty of room for both.

“There is no question, I think hyper-converged and Pure have been the two big disrupters in the market,” he said. “But I will say we are mostly operating in different segments. If you add up all of our competition with hyper-converged infrastructure, we are seeing them in less than five percent of our engagements.”

Dietzen also played down the need for software-only products, pointing out that software is the key to Pure’s technology but its customers want it packaged on the right type of hardware.

“A pure software packaging is hard to achieve today because there is still a great amount of variability in the underlying flash,” he said. “Each new generation of flash even from a single fab changes in behavior pretty significantly, and so we are constantly tuning our software to take best advantage of each generation of the flash technology.”

Giancarlo faces other issues as Pure Storage CEO. They include whether the vendor should expand beyond its FlashArray block storage and FlashBlade unstructured data platforms, and if it should explore acquisitions to grow. Pure execs so far have refused to address those questions, leaving them for the new guy.

August 22, 2017  7:21 PM

Druva pulls in $80 million for data management software

Sonia Lelii Sonia Lelii Profile: Sonia Lelii

Druva today said it has raised another $80 million in funding, bringing its total investments into the range of $200 million for the fast-growing data management software vendors.

The Sunnyvale, Calif.-based company claims to have more than 4,000 worldwide customers that include NASA, Pifzer, NBC Universal, Marriot hotels, Stanford University and Lockheed Martin. The latest funding round was led by Riverwood Capital but Sequoia Capital India, Nexus Venture Partners and Tenaya Capital also participated.

Dave Packer, Druva’s vice president of product and alliance marketing, said the money will be used to further expand its sales, marketing, research and development as it moves into the growing cloud data management market. Druva scored $51 million in new private financing back in October 2016, and used that to diversify its cloud backup platform and accelerate global marketing and sales.

“A lot of that has not been spent,” Packer said of the previous funding. “A large portion of the (newest) investment is going to ramp up engineering. On an engineering standpoint, (we want) to supply a single control plane for end-to-end backup, recovery and resilience.”

Druva sells two branded cloud backup products that will serve as the foundation for its data management software portfolio. The enterprise-level Druva inSync product is for endpoints and it backs up data across physical and public cloud storage. The Druva Phoenix is a software agent used to back up and restore data sets in the cloud for distributed physical and virtual servers. Pheonix applies global deduplication at the source level and points archived server backups at a cloud target.

Last February, Druva upgraded inSync with tools to detect ransomware attacks and help recover clean data. The endpoint software detects strange behavior patterns. The company recently announced its Druva Cloud Platform that provides a unified control pane for data management across endpoints, servers and cloud data. It works as a service model.

“This will allow for a more on-demand model,” Packer said of the Cloud Platform. “Instead of providing two different products, they can be put under a single control plane. A consolidation of services also provides a greater level of capabilities. Users can have a single point of access to all the data.”

Parker said in the last six years companies have seen even more silos and disparate locations data stores that have gotten even more complicated with cloud adoption, driving up the need for data management software.

“What happened with organizations over time is you have all these disparate silos of data which are not connected,” he said. “Your organization is growing but at the expense of a centralized data plan. They have not been able to reconcile that. In fact, the data center is no longer the center of their data. So we need centralized policy management.”

In the past two years, Druva has set up subsidiaries in Japan and Germany and opened offices in the United Kingdom, Australia and Singapore. The data protection vendor set up Microsoft Azure and Amazon Web Services (AWS) cloud data centers in Canada, the United Kingdom and Hong Kong.

The company has positioned its data management software to go up against traditional backup vendors CommVault and Veritas Technologies, which also are transitioning into broad-based data management players. It’s also competing with startup Rubrik, which has raised a total of $292 million in funding since 2015 for cloud data management.

Druva executives have stated their goal to do an Initial Public Offering (IPO) by the end of this year, assuming they hit their revenue targets.  Druva in 2015 claimed its revenues grew more than 100% year-over-year for five straight years.

August 21, 2017  8:43 AM

Cisco buys Springpath, brings HCI software in-house

Dave Raffo Dave Raffo Profile: Dave Raffo

Cisco re-confirmed its hyper-converged infrastructure strategy today by acquiring its HCI software partner Springpath for $320 million.

The Cisco HyperFlex HCI appliance consists of Springpath software bundled on Cisco UCS servers. Cisco became an investor in Springpath and signed an OEM deal with the startup in 2015, and launched Cisco HyperFlex in 2016. Cisco claims more than 1,800 HyperFlex customers.

Springpath sells software that powers hyper-convergence and competes with HCI software stacks from VMware (vSAN) and Nutanix.

The Cisco-Springpath deal should put an end to rumors that Cisco will buy market leader Nutanix, which would cost billions of dollars.

While disclosing the Springpath deal, Cisco identified hyper-convergence as the fastest growing data center market. It is also highly competitive. Cisco HCI rivals include Nutanix and the other major server players, Dell Technologies, Hewlett Packard Enterprise and Lenovo. Dell has the greatest HCI presence of server vendors. It owns VMware, sells vSAN-based Dell EMC VxRail appliances and also sells Dell EMC XC appliances running Nutanix software through an OEM deal. Lenovo has a similar OEM deal with Nutanix and resells other HCI software on its servers, and HPE acquired SimpliVity for $650 million last January for its ProLiant-based HCI platform.

Cisco expects the Springpath to close by the end of October. The Springpath team will become part of Cisco’s Computing Systems Product Group.

Liz Centonti, SVP and GM of the Computing Systems Product Group, addressed the acquisition in a blog today.

“The acquisition of Springpath is strategic to our data center portfolio as we transition to delivering software-centric solutions to our customers,” she wrote. ‘‘As one team, I am excited for the synergistic possibilities ahead to redefine hyper-convergence further and deliver seamless multi-cloud experiences for our customers.”

Given Cisco’s relationship with Springpath, the acquisition is not surprising. Still, Springpath has not been Cisco’s exclusive HCI software partner. Cisco sells vSAN-based Ready Node appliances and also resold SimpliVity software before HPE’s acquisition. And before Nutanix became a public company, there were rumors that Cisco would acquire the HCI pioneer.

The Cisco-Springpath deal may affect VMware and Nutanix in the HCI market. Now that Cisco owns its entire HCI stack, it has more incentive to sell HyperFlex instead of UCS with vSAN software. Nutanix has partnerships with Cisco resellers to package its software on UCS boxes. That arrangement does not directly involve Cisco, but Nutanix CEO Dheeraj Pandey would like to to persuade Cisco to work more closely with his company. The Springpath deal doesn’t kill that possibility, but certainly doesn’t help it.

August 18, 2017  11:04 AM

NetApp earnings lifted by all-flash sales

Garry Kranz Garry Kranz Profile: Garry Kranz

Strong all-flash sales and a new niche acquisition highlighted the NetApp earnings call this week. The vendor on Wednesday reported net revenue of $1.33 billion, up 2% year over year and above the midpoint of its guidance range.

The new pickup is Reykjavik, Iceland-based startup Greenqloud for an undisclosed sum. As with its pickup earlier this year of storage memory startup Plexistor, NetApp did not disclose acquisition details. Greenqloud’s Qstack self-service stack allows enterprises to build, deploy and manage branded cloud infrastructure across multiple hypervisors and locations.

NetApp’s all-flash business contributed $1.5 billion in revenues, reflecting a 95% growth in demand for its All Flash FAS, EF and SolidFire all-flash arrays. In prepared remarks, CEO George Kurian said NetApp has been able to “substantially outpace” the growth rate of competing vendor’s flash arrays, after NetApp initially was late to enter the all-flash market. NetApp ranks second in all-flash revenue to market leader Dell EMC.

“The industry is in the early innings of the move from disk-based storage to flash as customers modernize existing datacenters and build next- generation datacenters to lower the total cost of ownership while gaining greater speed and responsiveness from key business applications,” Kurian said.

Kurian said NetApp has secured committed NAND flash supplies to meet requirement for its fiscal year.

NetApp product revenues increase 10%, hyper-converged gear on the horizon
Consolidated gross margins of 63.8% and increased revenues helped boost NetApp earnings per share (EPS) to 62 cents, five cents higher than anticipated. Wall Street analysts estimated pegged NetApp’s revenue at $132 billion and its EPS at 55 cents.

NetApp product revenue was $723 million, which was up 10% and marks the third consecutive quarterly increase. Revenue from maintenance and services contracts fell 5% to $602 million, which NetApp blamed on changes to service pricing, several years of declining product revenue and on “renewal execution issues” in 2017, perhaps related to a disruptive software upgrade to its Clustered OnTap operating system.

Kurian took the helm at NetApp in 2015 and charted a strategy to expand its footprint in all-flash, converged infrastructure and hybrid cloud services. At the time, development of NetApp’s all-flash FlashRay scale-out product had dragged for years, appearing only as a single node in limited availability. NetApp scrapped FlashRay when it acquired SolidFire in 2015.

Since abandoning plans to build an EVO: RAIL system in partnership with VMware, NetApp also has been conspicuously absent from the hyper-converged market. Kurian said that will change later this year.

“We have already transitioned our business away from the declining segments to the data-driven, high-growth segments of all-flash arrays, converged infrastructure, and hybrid cloud,” he said. “We will further expand our opportunity with the general availability of our hyper-converged solutions,” based on SolidFire technology.

NetApp seems to have weathered being late in the all-flash and hyper-converged sectors. It closed the quarter with $250 million in operating cash flow, a 10% increase from the previous year, and free cash flow in the quarter of $214 million, or roughly 16% of net revenues. It is sitting on $5.3 billion in cash and liquid investments, and that’s after buying back $150 million in shares and paying out $54 million in cash dividends.

It also is using the money for strategic acquisitions. Kurian said Greenqcloud’s Qstack technology will “augment” development of NetApp Data Fabric for delivering hybrid cloud services.

Kurian used the NetApp earnings call to highlight a recently announced Microsoft partnership. Engineers from the two vendors are integrating NetApp’s Data Fabric to support automated storage tiering and backup technologies in Microsoft Azure, Azure Stack and Office 365. Joint product announcements with Microsoft are planned for the NetApp Insight user conference in October.

Estimates of NetApp earnings per share for the second quarter range from 64 cents to 72 cents. Net revenue is expected to range between $1.31 billion and $1.46 billion.

August 16, 2017  11:33 AM

Unitrends backup appliance products get hyped for Nutanix

Paul Crocetti Paul Crocetti Profile: Paul Crocetti

Unitrends backup appliance products will go where some vendors have gone before — supporting the Nutanix Acropolis Hypervisor – while adding a cloud twist.

The company’s Recovery Series backup appliances and Unitrends Backup virtual appliances will feature integration for the Acropolis Hypervisor (AHV). Unitrends is extending its core data center backup and recovery capabilities for Nutanix to the purpose-built Unitrends Cloud.

That cloud backend separates Unitrends from other partners, said Joseph Noonan, vice president of product management. Unitrends also offers the flexibility to protect all hypervisors that run on Nutanix. In addition, Unitrends supports VMware, Hyper-V and Citrix XenServer hypervisors.

Organizations can back up from Nutanix appliances directly to Unitrends appliances or to an external NAS device.

Veeam, Commvault, Rubrik and Comtrade Software are among the other data protection vendors that recently launched or will launch backup for Nutanix AHV.

Unitrends is looking to broaden its customer base with AHV support. Noonan said only a small percentage of Unitrends’ 19,000 customers use Nutanix. The Unitrends backup appliance line has a lot of midmarket customers, and Noonan said he hopes the AHV integration brings in more small to medium enterprises.

Noonan said he is seeing organizations that are early to adopt newer technologies going hyper-converged.

“It significantly reduces footprint for them,” he said. “It’s more about TCO and simplicity.”

He said customers are also looking to reduce infrastructure costs of VMware licensing.

Joseph Noonan, Unitrends vice president of product management

Joseph Noonan

Nutanix executives said at the vendor’s .NEXT 2017 user conference in June that using AHV can help customers save money by avoiding VMware enterprise license agreements, even if Nutanix HCI software and appliances are considered pricey. Nutanix offers AHV as part of its hyper-converged platform with no licensing costs.

On the cloud level, Unitrends backup appliance products also integrate with Microsoft Azure and Amazon Web Services. But there are gaps with the big cloud providers, especially as they relate to small and medium enterprises, Noonan said.

“We see the Unitrends Cloud being a better fit,” Noonan said, pointing to stronger service-level agreements, holistic support, scalability, and total cost of ownership and cost predictability.

Unitrends has been in the Nutanix Elevate Technology Alliance Program since October, supporting joint customers.

“Now we’re extending it more to integration,” Noonan said.

The Unitrends backup appliance integration with the Nutanix AHV will be available later this year.

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