At a customer event in Toronto Wednesday, Nutanix presented the audience with a full-throated positioning of themselves as well ahead of their competition, and also gave an update on their progress in Canada
TORONTO – Nutanix may technically still be a startup. They do, however now have over 1880 customers, in over 60 countries, as well as over 1200 employees. In the last year the hyperconverged space has become much more crowded, with younger startups entering the space and some older companies reworking their offerings for the hot space. Nutanix’s response, demonstrated at a .NEXT tour event for customers and prospects in Toronto on Wednesday, is increasingly to claim not just leadership but dominance in the space, with an aggressiveness that was not there a year ago.
“Now everybody claims to be hyperconverged,” Anton Granic, Senior Director at Nutanix, who runs the company’s operations in Canada, told the audience at the event at the Hockey Hall of Fame in Toronto. “We’ve created an industry. But there is nobody else in the industry who can do what Nutanix does. There’s only one true hyperconverged player.”
Granic said that both analyst and customer validation support their claim.
“Gartner in their most recent Magic Quadrant had us top right, and furthest to the right,” he said. “This has overwhelmingly validated our execution and vision as unparalleled in this space. We are already ahead of companies like HP and IBM and NetApp who have been in this business for 10-12 years. It’s rewarding but it’s just the beginning.”
Granic told his audience that Nutanix is the fastest growing infrastructure company of the last 15 years – with a growth rate 32 per cent higher than any of the pioneers like VMware and Palo Alto Networks who earlier took the industry by storm.
“It’s because the product works,” Granic stated. “Two and a half years ago we didn’t have any customers in Canada, and now we have over 150.”
Anjan Srvnivas, Nutanix’s senior director of product management, who is responsible for the company’s product roadmap and strategic direction, told the audience that the big webscale players like Google and Amazon made the original architectural breakthroughs that changed the basic assumptions of how infrastructure was built. By letting a software infrastructure control the pool of hardware, they assumed hardware would fail, but that this would keep services up and running. Nutanix filled a big gap in making this work for everyone else.
“We not only built web scale for enterprises, but for all, by building for any application at any scale,” Srvnivas said. “Combining this with one-click consumer-grade simplicity is responsible for all the current rewards we are reaping.”
Srvnivas said that going forward, Nutanix’s strategy will allow them to further differentiate themselves from the rest of the hyperconverged market.
“As we move from a one product company to a multi-product company, we are making the whole stack invisible, which no one in the industry has heretofore done,” he said. “They can just do it in slideware. We can do this for real because we have set up the foundation right.”
Nutanix laid this out in June at their .NEXT user conference in Miami when they unveiled their Xtreme Computing Platform, consisting of Acropolis and Prism. The first of its three steps, making storage invisible, Nutanix had already done.
“The next two steps are to make virtualization invisible and make the cloud invisible,” Srvnivas said. Their Acropolis hypervisor and new app mobility fabric are designed to make virtualization invisible, and Prism, which provides a single point of control for infrastructure management, does the same for cloud.
Granic said that the new Xtreme Computing Platform offerings responded to real customer needs and have already created large savings.
“At .NEXT, when we announced Acropolis, there was a huge AHHH across the room,” he said. He stressed that the free Acropolis hypervisor isn’t about going after VMware’s highly profitable hypervisor business, but giving customers an option for specific tasks.
“We have an oil and gas customer who continues to use VMware in their production environments, but who have saved $1.2 million by using Acropolis just in their test/dev environments,” he said.
Granic told the audience that while Nutanix is making major breakthroughs, the last year has seen other players in the space try to muddy the waters.
“Today there is a mass amount of confusion around who can do what, what hyperconvergence is and how it can impact your business,” he said. “In the last 12 months, everyone has used their marketing to create confusion, so customers don’t know what to look for. As the pioneers, it’s up to us to say who we are, and don’t let their marketing distract you.”
Granic stressed that manufacturers who lead with price lack in other areas.
“Everybody comes after us on price,” he said. “But when you put the prices side by side that 30 per cent price delta is a 50 per cent features and performance delta, which was the case even pre-Acropolis, and is even more so now. That’s where the rubber meets the road. Most if not all of our competitors are also selling futures, while we are here now.”
The reference customer Nutanix brought to the event to talk to other customers was Kingston ON-based Empire Life Insurance, a classic mid-sized company of the kind that Nutanix originally built its business around.
“We are a 90 year old company with lots of legacy systems,” said Jeff Babcock, Empire Life’s Manager of IT Infrastructure and Security. “Our initial interest was sparked by VDI, but our performance testing also found it was great for x86 workloads in general.”
Assisted by Kingston-based solutions provider Zycom Technology, Empire Life started with 13 nodes, and will soon be at 19.
“We have had 50-60 per cent savings in server infrastructure costs, and have eliminated 186U from the data centre, with another 60-80U going in 2016,” Babcock said. “We sunset our IBM mainframe, which wound up being shredded. Nutanix is now what Empire Life considers our default platform for x86.”
Granic stated that while these mid-sized customers are still key to Nutanix’s business, over the last year they have had more success with larger customers than they had before.
“In Canada, we have seen much larger adoption in the large enterprise space,” he said. “It is directly tied to the pace at which organizations move. Mid-sized are more nimble. Larger ones have longer processes and we are reaping the benefit now of the seeds we planted 18 months ago.”
This is also now impacting the Canadian government market, which is complicated by a federal procurement process that historically has made it a tough nut to crack for all kinds of new vendors.
“The hardest part in cracking those markets is making sure the technology is available for them to procure,” Granic said. “We already have federal and provincial and SLED level customers, all of whom have identified use cases where we have come in and solved a problem for them. The only difference between the public and private sector is process. With the private sector, if you can demonstrate a value proposition, things move faster. Public sector takes longer, but in the long run, it validates that this is the approach to take when it comes to new infrastructure.”
Granic said Nutanix’s free limited-scale, four node maximum Community Edition, which Nutanix staffers were offering to attendees at the event, is also driving new business.
“It lets customers see what it looks like on the hardware platform they prefer,” he said. “We think this will grow business significantly based on that experience.”
Two weeks ago, Nutanix unveiled a service provider initiative which will allow them to buy Nutanix on the same subscription-based pricing model that they themselves get paid by. Granic said they are very bullish about its prospects in Canada.
“Only a few service providers in Canada are national, but there are many localized or regional ones, and this service provider payment model, which is directly in sync with the Amazon model, will resonate quite nicely in Canada,” he said. “We see huge potential for it.”
For now, subscription-based pricing is just for the service providers, but longer term, that may change.
“Some enterprises are thinking about it, although I’m not sure how it something like that would work, as much as some would like to go down that road, because it’s early days,” Granic said. “In an end state, I think that will become the norm though.”