10 Reasons why Nutanix leads the hyper-converged industry

When I started this blog site last October, hyper-converged infrastructure (HCI) was still a fringe technology. Just five months later and HCI has entered the mainstream. Rather than fielding questions about hyper-convergence, the inquiries I get today are much more often about what sets Nutanix apart from the rapidly growing pack of HCI players?

Nutanix isn’t just the HCI front-runner; it has a 52% market share. Here are my top ten differentiators as to why Nutanix leads the hyper-converged industry:

1.  A true distributed file system with roots to Google and GFS

Nutanix brings the same type of no-SAN distributed file system infrastructure developed by Google, and now utilized by all leading cloud providers, to the enterprise. The commodity hardware, “share nothing” Nutanix Distributed File System (NDFS) model enables capabilities such as self-healing and data locality that uniquely position Nutanix for enterprise requirements.

 2.  Google-like transparency

Google published papers in 2003 about how it redefined infrastructure with GFS including innovative technologies like Map Reduce and NoSQL. Nutanix is similarly transparent about how our technology works. No secrets, no politics, no misleading claims. (As an example, see www.nutanixbible.com).

3.  Passionate employees

There are 1,648 billionaires on the planet, but only 190 VCDXs. Eleven of them work at Nutanix with more coming. These folks can pretty much work wherever they want. They’re joining Nutanix because of the technology, the culture and the opportunity to be part of revolutionizing the virtualized datacenter.

4.  Dedication to channel partners

Nutanix has been a channel focused company from day one. We strive to help our partners to not just be competent Nutanix resellers, but rather to be leaders in the new era of Web-scale HCI and associated cloud integration. We work with them to achieve differentiation, customer trust and expanded skill sets with programs such as Breakaway, Authorized Consulting Partner, and the recently launched NPX certification.

The learning, of course, goes both ways. We listen to our partners about how we can better serve their customers both today and in the future.

5.  A focus on an uncompromisingly simple customer experience

FW 9

Nutanix doesn’t just sell products, we deliver a customer experience. Nutanix simplifies the lives of IT administrators. Nutanix’s HTML5 Prism UI, for example, is beautifully designed and exceptionally intuitive and easy to use. Or consider firmware upgrades. Even the most advanced 3-tier architectures still require painful and risky firmware upgrades. But Nutanix changes the game with one-click, non-disruptive upgrades for all components including hypervisors.

6.  Industry-leading customer support

Most manufacturers claim that they emphasize customer service. Our customers and partners validate again and again that Nutanix takes support to a whole new level. Nutanix has a +88 Net Promoter Score and is the two-time winner of the Omega Northface Award for “Delivering World Class Customer Service.”

7. A furious pace of innovation

Nutanix’s engineering department doesn’t have a lot of ex-storage folks. Instead, engineers with backgrounds from companies such as Google, Facebook and Twitter build massively scalable, very simple and low-cost infrastructure. It’s a completely different mindset, and it leads to rapid development in response to customer requests.

While some innovations, such as the industry’s first HCI all-flash node, incorporate hardware form factors, most are delivered strictly via software (Tesla-style). Recent examples include Metro Availability (for active/active datacenters), encryption, MapReduce Deduplication, Cloud Connect, shadow volumes, Plugin for Citrix XenDesktop, etc.

8.  Multi-hypervisor support

Some HCI manufacturers claim to be hypervisor agnostic though they only work with one hypervisor. Nutanix started with VMware in 2011, began supporting KVM in 2012 and then Hyper-V in 2013.

9.  Dell validation

While Nutanix isn’t the only HCI producer to work with legacy manufacturers, we go far beyond just providing reference architecture. Out of all the HCI players, Dell approached Nutanix to establish a true OEM partnership. The Dell XC Converged Appliances – powered by Nutanix software were painstakingly vetted by both manufacturers to ensure the same high standards of quality, simplicity and support that customers receive with Nutanix-branded appliances.

10. A Web-Scale mindset

The legacy storage manufacturers treat HCI as a storage option in a large line card. Nutanix eats, breathes and sleeps HCI as not only a vastly superior platform for hosting a virtualized datacenter, but as the inevitable future.

Nutanix’s success with HCI has already shaken up the industry as almost every large legacy storage manufacturer now has, or has announced, an HCI solution. And Nutanix’s efforts resonate with customers who tend to have a passion for the technology rivaling that of Nutanix’s own employees.  Nutanix’s first customer conference, Nutanix.NEXT, this June in Miami is chock full of customer presentations. I have six different customers speaking on my ROI panel alone.

 

Thanks to @vmmike130, @Sandeep_NTNX, @farazip and @vEd_NYC for edits and suggestions.

 

 

Nutanix support wins world class award – again. Here’s what it means for partners.

Last year, Nutanix was one of only 35 companies recognized by Omega Management Group for “Delivering World Class Customer Service”. We did it again this year while increasing our Net Promoter Score (NPS) from a sky high +73 to an even more remarkable +88. This is all very good news for our partners for three primary reasons:

1. Validating Partner Evangelists

The most successful Nutanix partners are iconoclasts – they are not afraid to challenge the prevailing belief in the separation between compute and storage. They put their own reputations on the line by strongly encouraging their clients to consider Nutanix Web-scale as a superior architecture for hosting a virtualized datacenter.

The Omega and NPS scores provide these partners with additional ammunition in the fight against the status quo. They help validate that Nutanix not only has great technology, but also that our emphasis on customer service ensures their implementations will be successful.

Omega

2. Increased Partner Business

Nutanix’s product, like any software in the industry, is not perfect. But there is a saying, “Hardware eventually fails, software eventually works, and the people make all the difference.” Nutanix treats support as a competitive differentiator rather than as a cost center. If a customer has an issue, the Nutanix support team will quickly get to the bottom of it – and won’t rest until it is resolved.

Embracing world-class support as part of the company’s core competency helps create repeat buyers. As customers see how well the technology works and how simple it is to manage, they expand their initial use case, and then purchase still more nodes and services for other initiatives. Nutanix becomes almost a type of annuity business for our partners.

3. Indication of Nutanix Success

A concern that Nutanix partners sometimes encounter, often played up by legacy competition, focuses around the relative young age of Nutanix as a company. Customers want to know what will happen if Nutanix gets acquired.

Partners can provide many responses to combat this concern including Nutanix’s phenomenal growth, its HCI industry domination, our OEM deal with Dell, and the prevalent public speculation about an upcoming IPO.

Nutanix’s extraordinary NPS is yet another argument for continued accomplishment. Ever since its introduction in a 2003 Harvard Business Review article, Net Promoter Score continues to be advocated by many as the most important indicator of business success.

The NPS and Omega Award go hand-in-hand with the raving fans that Nutanix and its partners are engendering around the globe. In the month of January, for example, Nutanix featured a new customer success story every business day. It is typically not easy to convince organizations to be featured in a success story, but they tend to be very happy to share their experiences with Nutanix.

When legacy competitors try to fling the FUD about Nutanix’s young age, I encourage partners to counter by asking these firms to provide their own Net Promoter Scores. Assuming they’re even willing to share them, the contrast should be quite enlightening.

 “Nutanix support is absolutely fantastic. They’re super responsive, they’re all smart, and they aren’t afraid to go ask someone else for help. On top of that, they treat you like the engineer you are. You worked hard to get to where you are, to know what you know. When you call HP or Dell support, they start by saying things like “Did you reboot?”. Even if you say Yes, they still will force you to do the tier 1 troubleshooting first.

With Nutanix support, they take information you’ve provided and infer what troubleshooting has been done. If you tell them you’ve rebooted something, they won’t force you to do it again, because they trust you. They’ll then pursue to look for other solutions. They’ll more than likely know off the top of their head the exact solution, then pull up impeccable documentation on how to fix it.

They have a very knowledgeable staff, all of whom are willing to help each other. When having a drink with our SE the other night, we were talking about this very thing. He never feels that he is out in the dark on his own. He can throw a question about Citrix in their Yammer rooms and within a short period of time, have another engineer who is a Citrix specialist on a call, ready to assist. That’s an amazing amount of internal support, they don’t fight between regions, they don’t assume that you know everything, they help each other.”

– Unsolicited January 2015 blog post from an early Nutanix customer.

 

It Takes an Eco-System

NPS reflects not just the support organization, but the interactions customers have with every aspect of the Nutanix organization as well as with our partners. A reputation for world class support is dependent not only upon the quality of the product, but also upon its successful implementation. Nutanix’s innovative education organization and Authorized Consulting Partner Program enable partners to architect and deploy very successful Web-scale environments.

Nutanix and our partners have a mutual objective of continually raising the bar in respect to customer satisfaction and the repeat business that results. The NPS and Omega Award show that we’re hitting the mark. And as Nutanix Senior Director of Global Support, Deepak Chawla, said, “We will keep our laser focus on the customer and aim for ‘three-peat’ of awards next year.”

Thanks to both Deepak Chawla (@dchawla2005) and Lukas Lundell (@LucasLundell), Director Solutions and Performance Engineering of Nutanix, for contributions to this article.

Citrix’ Bill Burley on building a disruptive channel business

I used to run a Citrix partner business in the San Francisco East Bay. We weren’t in the first group of Platinum partners, but we were close behind. I remember the first Citrix Platinum Partner meeting I attended in the late 1990s in Florida. As sometimes happens with channel partners, we were complaining a bit. I remember Citrix’s head of North American Sales, Bill Burley, berating us – saying, “You should be bleeding Citrix colors!”

Burley

I thought about what Bill said, and realized he was absolutely right. It was the ability of Citrix to open new doors and to differentiate our organizations that was the engine powering most of our growth. Bill has long since moved onto other duties at Citrix (he is currently VP, Business Integration of Acquisitions), but with Citrix Summit approaching next week, I thought it would be appropriate to seek his perspective about channel partners and disruptive technology:

SK:  Can you give me some personal background about how you came to Citrix?

BB:  I ran sales at LANSystems which is where I first met [Citrix CEO] Mark Templeton. After Intel acquired the company, I joined Citrix to head up North American sales which included running channels.

SK:  What do you see as the importance of channel from a manufacturer perspective?

BB:  The channel allows manufactures to touch many customers. This allows manufacturers to scale far faster and easier than trying to utilize a direct sales force. Back when software came in a box, it was a boat anchor unless someone integrated it and made it a solution. The channel was the perfect vehicle for accomplishing this then, but is also instrumental today in helping customers deploy enterprise solutions.

SK:  How did you build out Citrix’ channel?

BB:  Coming from a leveraged channel model at LANSystems, I established a similar motion while at Citrix.  We started out recruiting Novell resellers. Before long, we helped the resellers get NT certified because our platform was NT-based. This had the side benefit of gaining Microsoft’s deep appreciation which in turn helped us recruit more partners.

SK:  When Citrix Presentation Server was introduced, it was a radically different approach from other products then available.  How did you help partners be successful in selling it?

BB:  When I first met [Citrix founder] Ed Iacobucci, he told me, “Bill, we’re going to change the way the world computes!”  From the beginning, we made sure that the partner community knew we were not just another “me too” product – but that we had a solution which would help their customers lower costs and increase employee productivity. The smart partners understood this opportunity – they could smell it. Like many new technologies, we started off small – targeting individual departments. Eventually, we took over the whole enterprise.

SK:   How did you build the great channel loyalty for which Citrix is famous?

BB:   We weren’t selling widgets or math coprocessor chips. We were selling business transformation. This entailed a lot of partner investment and commitment – if we had only emphasized software margin alone, the partners would have gotten up and left the room. Citrix was probably the first manufacturer to show the “drag” of other products and services that our technology pulled along. At one point, for every dollar of Citrix software, partners were realizing an average of $7 of associated pull-through. This drag, along with the ability of Citrix technology to enhance our partners’ role as trusted advisor with their customers, was very compelling to the channel.

SK:  What advice do you have for partners on how to capitalize on disruption?

BB:  It is important for partners to understand where they came from. They should be truthful to what their business is, what their customer base is, and how they serve those customers. Customers always rule. A partner’s job is to invest. I believe that partners should either commit, or get out of the game. Dabbling is a mistake. Partners who don’t invest in training, education and understanding of the opportunity won’t be successful.

Partners can, of course, be smart about embracing new technologies. They should run the technology by their core customers – the ones who will give them honest feedback. But if the good customers tell partners that the technology is golden, partners need to pull out the stops.

Citrix Summit 2015

Bill unfortunately is not going to be able to make Citrix Summit this year, but Nutanix is a gold sponsor and in addition to our booth, we have a meeting room, hospitality suite, presentations, etc. If any partners would like to meet with either me or with other Nutanix executives – please shoot me an email: kap@nutanix.com.

Channel partners rally behind Nutanix Web-scale converged infrastructure

“Really?!”

That was the one word email I received from Nutanix’s Sr. VP of Sales (and my boss), Sudheesh Nair, in response to the Q4 2013 Piper Jaffray Storage VAR Survey. The surveyed partners ranked Nutanix second to last in terms of sales performance relevant to plan.

Needless to say, I was frustrated. The channel perception of Nutanix was out of synch with Nutanix’s record-setting sales in 2013 as the fastest-growing infrastructure company of at least the past ten years.

But understanding and successfully positioning Nutanix has been a learning process for the channel. When Nutanix CEO, Dheeraj Pandey, first approached Lightspeed Venture Partners almost five years ago, he made it clear that his new company would disrupt the storage industry – including the venture capitalists’ existing investments. Unlike most entrants into the suddenly popular hyper-converged space, this revolutionary vision is integral to everything we do at Nutanix.

Partners can’t simply pitch a “faster, cheaper, better” storage array as they can with the other early stage companies in the survey. Partners need to be able to articulate and evangelize to their clients how Web-scale is a sea change that is fundamentally altering the infrastructure of the modern, virtualized datacenter.

The Difference a Year Makes

2014 continued the trajectory of rocketing sales and, gratifyingly, a much broader spectrum of channel partners caught the Web-scale fever as well. From small partners building their businesses around Nutanix to multi-billion dollar channel organizations moving Fortune 500 clients over to Web-scale, Nutanix is changing the channel landscape.

According to the latest Piper Jaffray report, channel partners now rank Nutanix sales performance in the #1 position – ahead of CommVault, Dell Storage, EMC, HP Storage, NetApp, Nimble, Pure Storage, Veeam and VMware.

Piper Jaffray

 

The Stern Agee Channel Survey similarly shows a huge improvement in channel recognition of Nutanix. Channel partners listed Nutanix as the second leading key company disrupting the established storage sector – right behind Pure Storage (but quickly catching up). Nutanix is ranked ahead of Nimble (and rapidly increasing the spread), and is ranked far ahead of Tintri, Violin Memory, Nimbus Data, Nexenta, Solidfire and everyone else.

sterne Agee

 

Looking Forward to 2015

It’s exciting to see Nutanix partners across the world enthusiastically embrace the Web-scale opportunity. They’re leveraging Nutanix to differentiate their companies, gain new customers, increase sales and shorten sales cycles.

I want to thank all of our partners for your continued faith and trust. The good news is that Nutanix is really just getting started. New capabilities such as one-click hypervisor upgrades, metro availability, connectivity to AWS and Microsoft Azure, among many others, mean extraordinary continued opportunity in the year ahead.

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Cisco jumps into the hyper-converged game

Cisco changed the datacenter game with UCS – the only server designed from top to bottom for virtualization. Despite widespread skepticism that the networking giant knew nothing about servers and would fail miserably, in less than five years UCS became the number one blade seller in the Americas.

In our new compressed disruptive-cycle world, Cisco itself has now fallen far behind when it comes to optimally hosting a virtualized datacenter. The company is, however, scurrying to catch up. Within the past few weeks, it’s been revealed that Cisco both invested in hyper-converged startup, Stratoscale, and also blessed Maxta as the first, and so far only, certified hyper-converged solution to run on Cisco UCS.

How UCS Thumped the Server Leaders

I’ve been a vocal fan of UCS from the beginning. In late 2009, when “over 100 companies” were using UCS, I wrote a blog post comparing UCS vs. the HP Matrix. While competitors scoffed at UCS as a “one-size-fits-all product”, I maintained that it would revolutionize datacenter virtualization.

The dominant server manufacturers of the day were perfectly happy with the status quo. But Cisco realized that virtualization would become the datacenter standard and that a new type of server was required. Cisco initially approached IBM and HP to jointly develop a product, but both companies declined. So Cisco instead funded VMware cofounder, Ed Bugnion, and a team of engineers to spend three years building UCS.

UCS helped mitigate virtualization challenges with capabilities such as FCoE (Fibre Channel over Ethernet), hypervisor bypass, extended memory, services profiles and a GUI that can help the server, storage and network teams collaborate more effectively.

But UCS’s Achilles heel is that it really only addresses a small part of the virtualized datacenter issues – the compute. By far the majority of the pain in the modern datacenter has to do with storage. Not surprisingly, four storage manufacturers, EMC/VCE, NetApp, Hitachi and Nimble, all incorporate UCS as an integral component of their so-called “converged infrastructure” solutions.

Channel partners across the globe, such as the one I worked for, understood that as customers increasingly virtualized their datacenters, they would want the enterprise capabilities and features that UCS offered. These partners worked with Cisco to make UCS the number two blade seller in the world.

Descending into Irrelevance

Ah, but all things must change – especially in a software-defined world. While Cisco was promoting the superiority of custom-designed ASICs, Nutanix was bringing the advantages of commodity-driven web-scale architecture to the enterprise. The impressive innovations that Cisco unveiled over five years ago are now not just obsolete, but superfluous.

  • Fibre Channel over Ethernet (FCoE): Unlike the converged infrastructure offerings built around UCS, FCoE is an example of true convergence of the network stack – melding fibre channel and IP Ethernet networks. But today, Web-scale eliminates the requirement for SANs and switching fabrics entirely.
  • UCS Manager GUI: Lets storage and server teams collaborate more effectively together. Not so useful when separate storage administrators are no longer necessary.
  • Custom ASICs: Cisco boasts 12% increased performance from proprietary hardware. Nice but inconsequential when Moore’s Law doubles performance every 18 months anyway. Nutanix utilizes commodity hardware, but increases performance nonetheless with regular software updates that improve hardware effectiveness.
  • Services profiles and templates: These were great in the day for relatively fast provisioning of ESX hosts. Nutanix Foundation is much faster and doesn’t require zone masking or manual hypervisor installs.
  • Integrating the Cisco Nexus switch: Making the network the management center was key to Cisco gaining traction with its network administrator constituency. But Web-scale eliminates the requirement for complex, intelligent and expensive converged network switches.

The leading converged infrastructure manufacturer, VCE, proudly advertises that it only takes 45 days to order and put a Vblock into production – 5 X faster than with conventional servers and storage. In contrast, Nutanix can be ordered, received, installed and in production in around five days.

VCE ad

Upgrading VMware vSphere requires a corresponding upgrade to the entire Vblock – a process that can easily require a team of consultants several days to accomplish. And even then there are risks involved. A former Vblock customer that recently migrated to Nutanix was still running three versions back of vSphere because they didn’t want to have to deal with the associated Vblock upgrade.

Contrast all of this time, expense and risk with doing a vSphere (or Hyper-V or KVM) upgrade on Nutanix. The process is literally just a single click. No cost, no downtime and no risk.

Lesson for Nutanix

UCS and Nutanix both target the same customers – virtualized enterprise environments. I’ve heard from multiple partners that despite our relatively tiny size, Cisco has declared Nutanix to be its number one competitor. Not HP. Not VMware. Nutanix. Cisco’s announcements around Maxta and Stratoscale reflect its determination to, albeit belatedly, get into the game.

Cisco is one of the most successful and well-run companies of all time. While known for its innovations in areas such as routing, switching, VoIP and collaboration – perhaps nothing has been as impressive as Cisco’s accomplishment in the datacenter. Cisco upended all of the existing dominant server players by developing UCS to fulfill the computing requirements of the virtualized datacenter.

The lesson here for Nutanix is that if Cisco can fall into complacency, anyone can. We’ve got to keep our heads down, be humble, stay hungry and keep innovating – even if we have to eventually disrupt our own technologies.

Lesson for Channel Partners

Cisco, VMware, Nutanix, Dell and HP, in addition to the other EVO:Rail partners and lots of startups, validate that hyper-converged infrastructure/web-scale is the future of the virtualized datacenter. There’s a $50 billion + annual server and storage market out there just begging to be disrupted by those channel partners with both the vision and the desire to execute.

Thanks to @vmmike130, @langonej, @evolvingneurons and to @richardarsenian for input.

When a channel partner looks in the mirror, does a trusted advisor look back?

In my former position as VP of Cloud and Virtualization at Presidio, I frequently used financial modeling to assist our reps, but did not drive sales on my own. That changed after I learned about Nutanix.

I loved the no-SAN concept and was curious to see how it would actually play in Peoria. I pitched a savvy CIO who had participated in an EDUCAUSE panel I moderated, and she was immediately intrigued. But the Chicago office of Presidio was reluctant to work with a new manufacturer. I just made the sale myself and convinced another region with which I had stronger ties to process the paperwork.

The experience should have tipped me off as to the type of situation I would face in my dual channel and strategic sales role at Nutanix. While it’s been surprisingly easy to sell web-scale converged infrastructure to former clients who have called me or vice-e-versa (always running the deals through partners of course), it’s often difficult to get buy-in from VARs – especially from large ones.

mfg rep 1

The Channel Partner Perspective

I had dinner a few days ago with the VP of Sales of a sizable regional VAR. He asked me how much business our top partner would do with us this year. I told him that one organization had a plan in place to sell $50M in our new fiscal year, though internally we pared it down to be conservative. The VP told me that his company will do $90M this year with EMC alone.

As enamored as he and his team were with our technology, I could tell he was thinking about how he could realistically present it internally. Even matching the sales of Nutanix’s largest partner wouldn’t come anywhere near the business he’s driving with EMC and Cisco. How could he convince his executive team that they should risk the wrath of their two largest vendors by promoting Nutanix?

And, suppose he did manage to persuade the executive team to go all in with web-scale; they still would have to get their sales reps on-board. The reps have established relationships with legacy manufacturers, are trained and experienced in selling their products and depend upon them for opportunities. These “coin-operated” reps do not readily gravitate toward promoting new technologies.

mfg rep 2

The Customer Perspective

If I were a CIO, I would not want a solutions provider who simply brought me different product configurations from a leading datacenter manufacturer – I could find that information myself on the Web. I’d want to work with a partner who was diligent enough to constantly investigate new promising technologies, and who was astute enough to discern which ones could have a positive impact on my organization. I’d expect the partner to bring those options and his recommendations to me for review.

VARs that close-mindedly mimic their vendor perspectives risk becoming, in the eyes of customers, glorified manufacturer reps. An EMC partner, for example, might feel confident today in leveraging a trusted relationship with a CIO to advocate Vblock as the best option for a VDI deployment. But the probability is increasing that the CIO will learn on her own that she could have implemented a similar project at a fraction of the cost and with none of the risk by utilizing web-scale. She will consequently feel her partner is either uninformed or, worse, acting in EMC’s rather than in her best interest.

mfg rep 3

Preserving the Customer Relationship

Channel partners tell me that large enterprises move very slowly – the implication being that they have plenty of time to continue making lots of money by promoting legacy 3-tier infrastructure. Perhaps they’re correct, but it’s a dangerous way to conduct business.

Henry Ford famously said, “If I had asked people what they wanted, they would have said faster horses.”  Just because a customer asks for more storage doesn’t mean a solutions provider should limit the conversation to arrays. They can take the opportunity to educate their client about how Google and the leading cloud providers have moved away from using SANs and ancient (1987) RAID technology. They can discuss the advantages of web-scale converged infrastructure and about whether or not the architecture might be appropriate for the customer’s environment.

Even if the customer decides, for whatever reason, to go with traditional 3-tier infrastructure, at least the channel partner looked out for the customer’s best interest. Over time, as web-scale/hyper-converged infrastructure becomes the virtualized datacenter standard, the customer will appreciate the effort and integrity of the partner for introducing it.

The Playing Field has Already Changed

I don’t agree with the premise that big enterprises will continue to move slowly. External pressures from public cloud and internal pressures from much more rapidly changing technologies will force enterprises to change more quickly as well.

Just look at web-scale. Almost overnight it has jumped solidly into the mainstream. VMware’s endorsement of hyper-converged infrastructure as the platform of choice for hosting virtual machines leaves no doubt as to the future direction of virtualized datacenter architecture.

Then there’s Dell – one of the “big seven” who collectively drive 76% ($56B) of the annual server and storage business. Dell also blessed hyper-converged architecture last week with its launch of the Dell XC Series: Web-scale Converged Appliances. Yet another of the “big seven”, EMC, has said it will develop its own EVO:Rail offering. Even HP is weighing in both with an EVO:Rail solution and with its own StoreVirtual product. Cisco is showing signs of making the leap as well.This massive validation during the past few months by the leading datacenter players enables solution providers to bring up web-scale without concern of appearing “bleeding edge”. It also means that they should, with at least some degree of impunity, be able to focus on hyper-converged solutions by creating a separate division explicitly for this purpose.

However they do it, I strongly encourage channel partners to figure out a way to get engaged with web-scale. Nutanix continues, and is even accelerating, our trajectory as the fastest-growing infrastructure company of the past decade. This provides an extraordinary opportunity for forward-thinking partners to grow along with us.

The VCE dissolution: here comes channel disruption

“Partnering is more difficult than acquisitions…Most strategic coalitions have a very high failure rate, worse than acquiring, and yet as a company, we’ve all three been able to do this.”
-John Chambers, 2009

The waves of disruption are starting to break.

Several magazines (see Sources) reported today that EMC is folding VCE into its business and buying out most of Cisco’s stake. Assuming this is true (EMC is having a big announcement tomorrow morning), it is another huge indicator of the massive datacenter disruption that’s coming. While I think that EMC will certainly still promote Vblocks, it’s hard to imagine that they’ll do so as enthusiastically as they did in conjunction with VCE.

Selling Vblocks

VCE has been on a $1.8 billion run rate. Vblock partners tend to love the product because they make a lot of money from selling, installing and upgrading it. One VCE partner told me that every time VMware upgrades vSphere, customers have to upgrade their Vblocks. This is a laborious process often requiring a team of consultants working up to three days to accomplish. It translates to great services business.

I have to admit, I was surprised at how well VCE has done during the past five years. When I initially heard about Acadia (as VCE was initially called), I thought that there was no way this product was going to sell. The idea of getting the server, storage and networking folks to all come together at the same time and agree upon a common platform purchase seemed to be an insurmountable challenge. A year later I was still somewhat skeptical. I even wrote a blog post about the sales incentive problems with misaligned quarter endings.

But I misjudged the desperation many IT staffs felt as they increasingly virtualized their datacenters. They faced huge challenges in deployment time, finger pointing between server and storage manufacturers, and in functional group collaboration. The topnotch salespeople from VCE, along with channel partner support, convinced many of them that “the world’s most advanced converged infrastructure” was an answer to their struggles.

pastedGraphic

Working for a channel partner that moved a whole a lot of both Cisco UCS and EMC, I jumped on the Vblock bandwagon and helped facilitate a fair number of sales utilizing ROI analysis. But I always felt that there had to be a more elegant solution to the challenges of hosting a virtualized datacenter than simply integrating separate products as a single SKU. Once I learned about the Nutanix web-scale architecture, I became convinced that this was a vastly superior alternative.

Channel Implications

A Taneja Group report comparing Nutanix with VCE (sponsored by Nutanix) was just released today. The report states, “Taneja has found that the majority of VCE customers adopted Vblocks because they already had active VCE or VCE-partner sales teams coming at them.”

It will be interesting to see how Vblock partners fare without the huge VCE focus and assistance. On the plus side, it’s almost a certainty that they’ll no longer have to promote Cisco’s ACI over VMware’s NSX. On the negative, they can say goodbye to the monetary incentives from the recently established joint channel program between EMC and Cisco.

Not surprisingly, I’d like to see more Vblock partners get on board with web-scale. In my opinion, selling Vblocks in comparison to selling Nutanix is like pushing rope. Even some die-hard very large Vblock customers have now started migrating to web-scale.

The Taneja Group report says it well, “We believe that even data centers that are happy enough with converged systems today will look to hyperconverged systems tomorrow. Better yet, instead of investing in a traditional convergence solution, businesses should consider going directly to a next-generation solution like Nutanix.”

Sources:

Cisco Said to be Selling Most of VCE Stake to EMC. 10/22/2014. Bob Brown. Computerworld.

Report: EMC to Take a Bigger Role in VCE as Cisco Reduces Stake. 10/21/2014. Barb Darrow. Gigamom.

The End of Pretend? Cisco Looks to Partially Exit VCE Joint Venture. 10/21/2014. Ben Kepes. Forbes.

EMC Said to Absorb VCE Joint Venture as Cisco Reduces Stake. 10/21/2014. Dina Bass & Peter Burrows. Bloomberg.

Tech Titans Unite for Private Cloud Push. 11/05/2009. Jennifer Kavur. IT World Canada.

http://www.itworldcanada.com/article/tech-titans-unite-for-private-cloud-push/40087