Nutanix bets big on HCI to carve its own niche

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Amarish Karnik, Director – General Business & Partners, Nutanix

Nutanix’s new architectural design that pairs web-scale engineering with consumer-grade design is finding huge adoption among Indian enterprises

Amidst the widespread adoption of emerging technologies by Indian enterprises, with data centres being central to digital transformation journeys, HyperConverged Infrastructure (HCI) has placed itself as one of the key components of the overall IT infrastructure story. HCI is rapidly becoming the new normal for modern data centres. While it is being marginally preferred for perimeter workloads, which are non-core for the business, it is also being used extensively where organisations have high scale-out requirements. With scalability and simplicity as the key parameters for customers in India, HCI appliances have placed themselves as a perfect fit among businesses. HCI has been gaining traction to address both, optimisation demands and removing infrastructure management complexities.

According to a recent report by MarketsandMarkets, global hyper-converged infrastructure market is expected to reach US$ 12,607.4 million by 2022, at a CAGR of 43.59 per cent by 2022. The report also underlined that Asia-Pacific is estimated to be the fastest-growing region in the global HCI market during the forecast period. Significant growth rate of the APAC region primarily owes to the growing demand for virtual environment-based applications, including virtual desktop infrastructure (VDI) and server virtualisation, and strengthening software controlled unified system deploying the tasks of server, storage, networking, and virtualisation services.

According to the report, one of the major players in the global HCI market include Nutanix, which primarily specialises in HCI offerings. Providing an overview of Nutanix’s presence in this space, Amarish Karnik, Director – General Business & Partners, Nutanix, shares, “The term HyperConverged Infrastructure (HCI), itself is coined by Nutanix. When Nutanix started shipping HCI equipment, primarily to the US markets, there was lack of response from the market. However, now the same giants are acknowledging HCI as a category and its validity – we have changed the market dynamics and the game with our market leadership in HCI.”
According to another report from International Data Corporation (IDC), global converged systems market revenue has reported a surge of 19.6 per cent year-on-year to US$ 3.2 billion during Q1 2018.

Emergence of HCI
Numerous complexities have been existing in data centres for the last two decades, with negligible development in terms of storage and servers. “The only new piece we have witnessed in the last 20-25 years is that of virtualisation. However, even with the introduction of the virtualisation layer, the architecture hasn’t changed,” informs Karnik.

Sharing another interesting observation, Karnik says that customers are not concerned about the brand of hardware or hypervisor; the delivered SLAs and timelines matter the most to customers. Nutanix has pushed the same thought process in the market for data centres well. He says, “We integrated everything, which thereby formed HCI. We also changed the game from a hardware standpoint. For instance, running an entire data centre on a simple node cluster, instead of multiple racks. Customers have started using our solutions more effectively – more than we had thought of. Nutanix did compression of servers and storage, with an option of virtualisation given to customers. Following that, we made virtualisation invisible, like in the case of a public cloud.”

Consumer trends
There are various applications of Machine Learning (ML) and Artificial Intelligence (AI) in public cloud services. Nutanix has focused on providing the experience of a public cloud, but on-premise. “Any workload which is elastic in nature, should be ideally put on public cloud. Whereas, things such as ERP and email servers should be on-premise. Customers have also started realising this. We have observed that many organisations get attracted to public cloud, because of OpEx; however, every service on public cloud comes at a cost. Upon this realisation, they come back to Nutanix. Polycab, for example, decided to work with us not just for their data centres, but also their warehouses – called Edge Computing,” he comments.

The company has marked significant adoptions by customers. Over 50 per cent of Nutanix’s customers have moved to virtualisation for the first time. Customers who have been using standalone servers and storage are moving to HCI with Nutanix as an integrated solutions provider.

A large part of Nutanix’s customers saw HCI as a new technology when it was first introduced to them; they weren’t well-versed with it. However, within no time, customers realised the significance of HCI. Some of Nutanix’s biggest customers have also set the tone for HCI as a technology that needs to be increasingly adopted in the future. “We have marked two types of customers who have adopted HCI. These include those organisations which are early adopters of every technology; and those organisations which don’t possess large IT teams. It is all about customer experience. Following our first deal, the same customer referred HCI to many other organisations. Customers appreciate the agility, when time-to-market is reduced significantly with HCI,” informs Karnik.

Innovations
Nutanix started as an HyperConverged Infrastructure solutions provider, and focused on providing a seamless experience to customers in a multi-cloud environment, allowing them to move workloads from on-premise to cloud and vice versa. The company’s innovation has helped customers to take the HCI approach as a building block in their journey towards a multi-cloud environment.

Recently, Gartner has placed Nutanix as a Leader in the 2018 Gartner Magic Quadrant for HyperConverged Infrastructure.

Partner focus
Amidst widespread adoption by customers, partners have also realised that HCI can be a huge revenue opportunity for their businesses. Not being confined to selling products, partners can also earn by building services around those products; for instance, migration of workloads. However, partners can further enhance the business through application-led discussions with customers. Nutanix has been helping partners to initiate application-centric talks with customers.

Nutanix is now moving to a subscription model. For instance, Nutanix’s acquisition of Mainframe2, Inc validates this, offering Desktop-as-a-Service (DaaS).

Karnik says, “Partners play the most important role for Nutanix, in India and globally. Our partner ecosystem is geared up for the foundation, deployment and building of services around HCI. The next challenge for us is to develop the DevOps, automation and subscription practices for them. We are addressing this through more expansion and engagements.”
Recently, Nutanix has announced the launch of its new channel charter, Power to the Partner. The charter stands out from traditional channel programs by providing a unique emphasis on partner investments in Nutanix rather than solely on revenue targets. Further, the charter focuses on empowering Nutanix partners with the tools they need to support their customers in adopting next-generation data centre technologies. As a result, partners will gain further avenues to grow their businesses with Nutanix and will be enabled to achieve ongoing, predictable success.

The new channel charter is all about educating partners on the complete Nutanix story; it’s about the overall stack, not just standalone solutions.

“We have two categories of customers: enterprise, commercial and mid-market, and SMB. The enterprise segment is largely led by Nutanix; whereas, the commercial, mid-market and SMB space is entirely driven by our partners. Our customers’ success defines our partners’ success. As customers put more and more workloads on Nutanix platform, it becomes easier for them to expand later. Under our program, we drive two things – partner advocacy and customer success,” he says.

Initially, Nutanix focused on making the infrastructure invisible, hence required partners from the infrastructure space. This was followed by the focus to make the data centre invisible; this is where partners in the DevOps space play an important role. Whereas, the third set of partners – born-in-the-cloud – helps Nutanix in making cloud invisible.

“Each and every partner has to build a different practice. For example, making infrastructure invisible requires different skill sets. Partners need to reskill themselves, create separate business units in their company, and up the game. Today, separate teams of partners sell infrastructure and cloud. For measuring success of our partners, their bottomline is crucial. Value is equally important for partners. For instance, when partners sell Nutanix solutions, they open doors for many more opportunities from customers,” explains Karnik.

The Nutanix Velocity program includes accelerated selling processes, incentives and marketing investments for strategic, mid-market focused channel partners. The Nutanix Velocity channel partner program offers partners more incentives and opportunities to provide the Nutanix Enterprise Cloud OS software to customers in the mid-market segment. Through this new program, Nutanix is enabling partners to demonstrate to customers in the mid-market how hyper-converged infrastructure can help provide a solution to their needs without the cost and security challenges they may face with public cloud-only models.

Alongside its network of focused partners across India, Nutanix drives some of the business – especially in Tier 2 markets – through distributorship. “Our Velocity program is completely based on distributorship, wherein distributors lead the conversations with customers with partners’ help. About 8-10 per cent of our business comes from this segment. We have around 30 active partners across the country. In terms of rebates, we have been running multiple programs on front-end back-end rebates,” he says.

Accelerating growth
Multi-workload provides stickiness to partners. Whereas, multi-products will provide more pipeline to partners. “We have built multiple products, but HCI remains our bread and butter; and we are committed to do excellent work in this space. We will expand our team, along with our channel ecosystem. Recently, we have been identifying and generating business from areas where we weren’t present before – we are also focused on building that, and are encouraging our partners to tap these opportunities,” adds Karnik.