Nutanix Expands Hyperconvergence Footprint
November 4, 2015 Timothy Prickett Morgan
Storage servers in their many forms are rapidly making traditional storage arrays, with their custom electronics, a thing of the past, and hyperconverged server-SAN hybrids are a hot commodity in the enterprise datacenter because they radically simplify virtualized infrastructure and deliver some of the operational benefits that hyperscalers have created for their own converged infrastructure.
But here’s the rub. Every organization, whether it is a large enterprise or a hyperscaler or a cloud builder or an HPC center, has its own preferences when it comes to servers. So once they can see it is just a server running some software, rather than a sealed box like a switch or router or disk array used to be, they think they should have choices. Somewhat paradoxically, organizations may want a converged or hyperconverged appliance experience – meaning it plugs together simply and without much fuss – but they want that hardware to be from a vendor with which they are familiar.
This is one reason why we believe that all hyperconverged storage suppliers will eventually have to open up their hardware compatibility lists if they want to expand their market reach. This is something they are loath to do because a large hardware support matrix is very expensive to maintain, and frankly, it can kill a software business. But there are many hundreds of thousands of potential customers – a base that all of the hyperconverged players have barely scratched despite all of the hoopla – and many millions of server-storage hybrid nodes at stake, and eventually, someone will have the financial wherewithal to bust out of the appliance and go all-software.
This is one reason we think that Nutanix, one of the pioneers in the hyperconverged storage arena, has formed alliances with Supermicro and Dell to be its hardware supplier and has forged a reseller agreement that lets Dell resell the Xtreme Computing Platform, which we detailed here (including its homegrown KVM hypervisor) and which the Nutanix server-SAN software stack is now called, atop Dell’s hyperscale-derived PowerEdge XC servers. These XC machines are variations of its PowerEdge R630 1U rack-mounted servers and the R730xd 2U storage-dense servers; it is not clear what makes them different from other servers except their very precise configurations of CPU, memory, flash, and disk.
The problem is that these appliances, whether they come from Nutanix or Dell, are not cheap – anywhere from about $25,000 to $110,000 per node including all the software bells and whistles – and this means potential customers are not able to experiment with the Nutanix stack. If Nutanix wants to grow its base by an order of magnitude – its investors certainly want it to do that – then it is going to have to go broad as well as deep. While the $300 million annual run rate that Nutanix hit back in May and its current installed base of 1,800 customers is growing at somewhere between 200 and 300 customers per month, VMware has over 500,000 customers using its server virtualization software, its own Virtual SAN hyperconverged stack that probably has almost as many customers by now, very deep pockets, and possibly a new owner (Dell is buying EMC, which owns most of VMware) that might want to prefer to sell Virtual SAN over Nutanix.
Back in May, when Nutanix launched the Community Edition of its software stack to allow customers to experiment on clusters with up to four nodes, we said this was as much about widening the hardware compatibility list for the Xtreme Computing Platform as it was about cultivating potential customers, and we stick by that. But OEM deals like the one that Nutanix has with Dell work, too.
“We have respect for hardware and we don’t just want to throw software and make it open ended with some loose hardware compatibility list that could lead to some unexpected experiences. We are still going to work very closely with OEMs, but our desire is to become a broad software platform, and that means making it available on all hardware platforms.”
This week, Nutanix is expanding its hardware support with an alliance with Lenovo, the Chinese PC and server maker that bought IBM’s System x business a year ago and that is currently the number three server shipper in the world thanks to that deal. As part of that deal, Lenovo acquired the rights to manufacture and resell IBM’s Storwize disk arrays, but beyond that the company does not have a SAN business to protect as Dell, Hewlett-Packard, IBM, and other server makers do. So Lenovo can embrace Nutanix wholeheartedly and push it down into the System x base in the United States, Europe, and China – markets where it has considerably presence.
Nutanix, which has raised $312.2 million in five rounds of funding, is privately held at the moment and does not release a breakdown of its sales direct versus OEM, and frankly might not do that once it does go public. But Howard Ting, senior vice president of marketing at Nutanix, tells The Next Platform that it takes some time for OEM partners to get ramped up and that is why Nutanix has been taking a measured approach to adding OEMs for its software.
“At some point in the future, it is not out of the question that we could sell software and customers could choose to run it on any number of platforms,” says Ting. “But our strategy is to work very closely with OEM partners so we can ensure the right level of performance and consistency across the platforms that we are selling. We have respect for hardware and we don’t just want to throw software and make it open ended with some loose hardware compatibility list that could lead to some unexpected experiences. We are still going to work very closely with OEMs, but our desire is to become a broad software platform, and that means making it available on all hardware platforms.”
That would seem to necessitate a deal with Hewlett-Packard Enterprise, the datacenter part of the former HP, for its ProLiant servers, due to its dominant share of the X86 server market. But HP, which bought what is arguably the true pioneer in the hyperconverged space (storage array maker LeftHand Networks) back in 2008 before Nutanix was even founded, has its own StoreVirtual Virtual Storage Array platform. Nutanix has over 10,000 downloads of its Community Edition freebie version of the Xtreme Computing Platform, but through August, HP had shipped over 1 million trial versions of the StoreVirtual VSA. HPE will not say precisely how many have actually been fired up, but says it is on the order of tens of thousands. This is roughly the same ratio that Nutanix is seeing for its freebie to paid versions, too.
A partnership with Cisco Systems would also seem to be a requirement, but Cisco has its own OEM agreement with SimpliVity, which uses a an FPGA to perform de-duplication, data compression, and other data management schemes for its OmniStack hyperconverged software, and with Maxta, for its MxSP. Interestingly, Lenovo also has a deal reselling SimpliVity’s OmniStack on its System x3650 M5 servers, which are two-socket Xeon E5 v3 servers that come in a 2U chassis with 24 drive bays for disk and flash.
Kamran Amini, executive director of enterprise storage at Lenovo, says that the initial machines that Lenovo puts the Nutanix stack on will be rack-based servers, and we suspect that the System x3650 M5 will probably be the one that it uses. Amini would not say anything other than that the Nutanix-capable machines will be announced in December and that clients wanting to try out hyperconvergence were not wanting to try out a new server hardware form factor at the same time, so racks make sense. Going forward, he added, Lenovo could deploy Nutanix on different kinds of iron, depending on customer needs. Lenovo will be selling the Nutanix appliances based on System x machines globally, with Nutanix having its own sales team dedicated to this as well as a Lenovo sales team and the substantial enterprise sales channel that Lenovo got by virtue of the System x acquisition from IBM.
One last thing. There is an idea out there that hyperconvergence might be inspired by hyperscalers and aimed at large enterprises, but that it has seen the most success among midrange businesses. Ting says that this is not what is happening at Nutanix, even if it might be happening for other suppliers of hyperconverged appliances. The commercial customers that Nutanix is selling to have hundreds of nodes, which is about the size you would expect from a contained set of workloads in our experience, and that some customers have over 1,000 nodes. The largest Nutanix customer has over 1,500 nodes, and Nutanix is being cagey and doesn’t want to let it be known precisely how large this installation is. Moreover, says Ting, over the time that Nutanix has been shipping its appliances, around half of the units that it has shipped have gone to Global 2000 companies or slightly smaller, or large government agencies that are roughly equivalent to them.