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The nascent hyper-converged market received strong industry validation in 2014. Dell signed an OEM partnership deal with Nutanix, and VMware moved fully into the market with its virtual SAN software followed by its EVO: RAIL initiative, which allows storage array vendors to launch systems with Virtual SAN software.
The momentum has continued in 2015 with VMware's release of Virtual SAN (VSAN) 6 and EMC's first EVO: RAIL system, Vspex Blue. Now the market consists of hyper-converged pioneers Nutanix, SimpliVity and Scale Computing, VMware and large stage vendors EMC, Dell, HP and NetApp Inc. Other hyper-converged newcomers that emerged in 2014 include Maxta, Gridstore, Nimboxx and OpenStack-based Stratoscale.
We caught up with Enterprise Strategy Group senior analyst Mark Bowker for his take on the hyper-converged market, how the vendors differ, and where he sees it all going in 2015 and beyond.
Let's start with the obvious: How will VMware's EVO: RAIL initiative affect demand for hyper-converged storage systems? Will the EVO: RAIL consortia adversely affect startup vendors?
Mark Bowker: EVO: RAIL is pretty much a baseline configuration. All the EVO solutions are basically the same. VMware put out a very specific recipe that hardware manufacturers have to adhere to to be EVO: RAIL partners. They can differentiate their hardware a little bit, but they all are required to have a certain number of processors, a certain number of disks, and so on. What the hardware partners have to do is differentiate beyond the EVO: RAIL requirements. The EVO examples use standard hardware pieces built around VSAN software. VMware has the luxury of a lot of advocates inside the data center. They can now turn to these advocates and offer them a hardware stamp for VSAN through EVO: RAIL partners.
But EVO is like a starting block when you compare it to a company like SimpliVity, which has been doing hyper-convergence a little bit longer than anyone else. SimpliVity has written its own data management fabric and built its own intellectual property for hardware acceleration right inside the box. That gives it a hardware advantage through acceleration, inline compression and deduplication. This also gives SimpliVity an interesting management differentiation for managing on-premises scalable infrastructure, with the capability to replicate storage and push it off to other sites.
Will EVO: RAIL partners like HP, Dell, EMC and NetApp end up cannibalizing their own storage?
Bowker: I hear what you're saying, but I don't think so. The EVO: RAIL check box is going to be an easy thing for vendors to check. It's going to depend on the situation and how things mature, but when it comes down to it, chances are a vendor is going to have a conversation with a customer that goes well, well, well beyond EVO:RAIL. I think it's more of a check-the-box thing for a vendor to say, "We are participating in EVO: RAIL," as opposed to them seeing a giant market opportunity.
All of this does have the potential to disrupt the business model of legacy array vendors. They've been selling storage arrays to specific markets for years, and hyper-convergence has the potential to be really disruptive. Two or three years ago, no one really thought much about legacy vendors moving into hyper-convergence. Now I'd say that is the case more often than not. And some of these emerging vendors have customer deployments in the hundreds and thousands of systems. All of a sudden, that creates the beginning of a market where legacy vendors decide they have to add that capability to their portfolios.
Which hyper-converged startups are considered the leaders?
Bowker: Just look at who is getting investments. We see a lot of money being invested in Nutanix and SimpliVity, for example. They've been doing this for a while now. Both are very enterprise-focused companies with hundreds of customers. Then you take companies like Scale Computing and Nimboxx, for example. Scale Computing doesn't get talked about as much as the others, but it has thousands of customers and is going after a different portion of the market: small and medium-sized businesses that are non-VMware shops. I've heard good things about Nimboxx, and I think they are smart to lay low, watch what's happening in the space with EVO: RAIL, and quietly build out their technology.
Maxta and Stratoscale take a software-only approach to building hyper-converged storage. How do they stack up to competing startups?
Bowker: Maxta was smart to get its software validated to run by Cisco and HP. I think they needed to do that. One-off instances using other vendors' hardware is how the software-only guys are going to get to market.
How can startups distinguish their hyper-convergence offerings from the EVO: RAIL stack?
Bowker: There are things they can do. Nimboxx and Scale Computing both are KVM-based, so moving to a non-VMware platform really strips away the cost of software licensing for the hypervisor piece. In those instances, the savings can be extremely attractive. Some of the EVO: RAIL solutions are measured in six-figure investments. Go with a Nimboxx or Scale solution and it can be significantly less, which makes it interesting from an economics standpoint. So there's an economic play that non-VMware and even some Microsoft customers can make. The other differentiators can come from designing the storage fabric differently, which gives you gains in efficiency and capacity, or come from vendors like SimpliVity that have replication built into their systems.
Which type of storage workloads is hyper-convergence commonly being used to address?
Bowker: Maybe they look at using a hyper-converged platform for a specific application workload or small installation project inside of IT. I've seen customers use SimpliVity for that use case, and Nutanix as well. Let's use SimpliVity as an example: If I buy the SimpliVity platform, I don't have to involve the storage team, the networking team, the VMware team, and so on. I don't want to oversimplify this, but basically, I can just plug in the hyper-convergence box and have enough generalist IT skills to administer the entire system without the interaction of the higher IT department.
The terminology can be confusing. Some vendors use the "converged" and "hyper-converged" terms interchangeably. How could enterprise storage buyers vet the different vendor's claims?
Bowker: True hyper-convergence ultimately means that the software stack that's running the hyper-converged system is written, managed and engineered by that particular software vendor. That means, for example, that VMware is able to do some things with VSAN on its partners' hardware. Nutanix has its software running on hardware somewhere, and can even run it on the Amazon cloud. I think hyper-converged infrastructure has to focus on the full stack. I think it needs to include some type of hardware platform. Take VMware for example: when they first came along with VSAN, they couldn't really sell it because it was essentially just software. Users found it difficult to use with their existing storage hardware -- which is how EVO: RAIL came about.
Do you think we'll see more vendors enter the hyper-converged market in 2015, or will there be consolidation?
Bowker: I think we will see some new vendors entering the market, but probably not at same pace as over the past two years. I think the introduction of VMware with EVO: RAIL has probably slowed the pace of emerging or disrupting vendors bringing new technology to market. This is the year for these disrupters to come out and start differentiating themselves from the rest of the market, proving through customer example and application example just how well they are doing in the market.
I think there is potential for some traditional hardware vendors to make investments in the integrated platforms. Cisco seems the most obvious one to make investments. Cisco has not announced its participation in EVO: RAIL, but it is qualifying other vendors' hyper-converged platforms. Cisco has taken a data center approach, as opposed to just a server solution. It's getting into storage through partners like NetApp's FlexPod, SimpliVity, Maxta and Pure Storage.
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