ANAHEIM, Calif. -- In his Nutanix .NEXT keynote this week, Nutanix CEO Dheeraj Pandey showed a graphic from the hyper-converged vendor's early days displaying bullet holes through the acronym "SAN." The message from back then was hyper-convergence would eliminate the need for storage area networks.
"What has changed over the last 10 years?" Pandey asked. "We just added a v" before the SAN.
The joke was Nutanix now wants to eliminate the need for VMware's vSAN, which has emerged as its top contender among HCI software. Pandey quickly added he was "just kidding," and he played down the VMware rivalry in an interview after the keynote.
"The market is so large, and I can't do anything about the competition," Pandey said. "Our main threats are internal."
However, Nutanix versus VMware is the dominant battle in HCI software today. The two own the lion's share of the HCI market between them. In the fourth quarter of 2018, VMware and Nutanix combined for nearly 70% of HCI software, according to IDC, and more than 90%, according to Gartner. IDC put VMware first and Nutanix second, while Gartner had it the other way around -- but both research firms showed VMware gaining ground with vSAN and VxRail appliances sold by VMware parent Dell.
Meanwhile, Nutanix said 40% of its customers' nodes now run its own AHV hypervisor developed as an alternative to VMware's vSphere. And Nutanix and VMware are rapidly developing services to help customers move between on premises and public clouds.
Matt Day, CIO of Langs Building Supplies in Australia and an early Nutanix customer, summed up the Nutanix versus VMware rivalry during .NEXT when he spoke of how he first heard of the HCI pioneer. Day said his VMware reps told him about "a little company called" Nutanix one day when they took him to lunch.
"If they knew then what they know today, there's no way they would've picked up that tab," Day said.
HCI 'crosses the threshold'
A recent survey by the Evaluator Group analyst firm found that 70% of respondents said they considered hyper-convergence a better option than converged infrastructure, which includes traditional model of SAN arrays and servers. Evaluator Group senior analyst Eric Slack said HCI has gained interest in each of the three years the firm has conducted the CI and HCI survey. The most recent study found it is often used for critical workloads.
"It's probably the first year where a majority of the companies we talked to felt like HCI was a viable enterprise tool in the toolbox," he said. "This year it crossed the threshold."
Slack said nearly all the companies surveyed who considered HCI had Nutanix and VMware on their short lists.
Slack said Nutanix deserves high marks for this technology but "has a reputation for being high-priced. They've always led the market in features. When you have all the features, it's a value." He said vSAN has made up a lot of ground over the past year or so, feature-wise, by adding capabilities such as deduplication and encryption.
"The big thing about VMware is everybody knows vSphere and vCenter, and vSAN is part of that," Slack said.
Is AHV hypervisor invisible?
While VMware has made strides with hyper-converged features, Nutanix has increased the capabilities of its AHV hypervisor based on open source KVM technology. Pandey said by building a hypervisor into the HCI stack, Nutanix has "delivered hyper-convergence through an invisible hypervisor."
When asked how close AHV is to reaching feature parity with VMware, Pandey said, "Feature parity is meaningless in this new world of hyper-convergence. [VMware] put in a lot of features for the three-tier world. They did a lot of things for storage area networks and Fibre Channel and storage arrays. We don't have to worry about that."
By making its hypervisor-free and including a quick migration feature from vSphere to AHV, Nutanix is trying to get VMware customers to switch. Nutanix does not disclose how many of its customers are using AHV as their only hypervisor, but its customer base has always been made up mainly of VMware users.
AHV users find it hard to 'flip the switch' from VMware
One .NEXT panel session included four customers moving from VMware hypervisors and standardizing on AHV for new workloads. All four said they wanted to save on VMware licenses, and several said they were not using "all the bells and whistles" of VMware's enterprise-class hypervisor.
"We're trying to save on VMware tax" because of tight budgets," said Brent Morrow, global CTO at Sedgwick Claims Management Services.
David Luke, director of IT engineering at International Speedway Corp., said AHV "gave us the opportunity to investigate something other than VMware. We couldn't just flip the switch and all of a sudden we're all AHV, but it did give us the option to have that and start building that cluster out."
The biggest issue for the AHV hypervisor adopters is the support ecosystem -- not all third-party vendors support AHV. "We still have VMware because of that," said Manuel Rocha, Intel server team lead at TransCanada.
VSphere to AHV, Nutanix is trying to get VMware customers to switch. Nutanix does not disclose how many of its customers are using AHV as their only hypervisor, but its customer base has always been made up mainly of VMware users.
Xi Clusters run Nutanix OS on AWS bare metal
Nutanix is working to broaden AHV support, especially with cloud vendors. Nutanix this week previewed Xi Clusters that allow customers to run the Nutanix Enterprise Cloud OS on AWS EC2 bare-metal instances through AHV integration.
Customers can manage the clusters through Nutanix's Prism console and they do not need a new AWS account. They can connect through AWS Direct Connect, a virtual private cloud or a virtual private network
Nutanix also previewed Test Drive, which allows customers to run its stack natively in Google Cloud.
"Being a software company gives us the freedom to deliver it where the customer is," Pandey said. "If the customer is in AWS, we can deliver it in AWS. If the customer is on prem, we can deliver it on prem. But we can do it invisibly.