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back to article NetApp snoozing at the wheel of incumbency juggernaut, says chap

Equity analyst firm William Blair thinks NetApp is failing to face up to the realities of being an incumbent storage supplier, and could even exit the hardware business. A research note from William Blair, dated March 17th, has fluttered its way to the storage desk at El Reg. It says: "We sense a company grappling with massive …

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"the company sees five unprecedented technological changes affecting the IT industry:"

Uh ... Unprecedented? I don't think so ...

"Flash memory" -> EEPROM and/or RAMdrive

"Cloud computing" -> NSFNET

"Converged infrastructures - compute + storage + networking" -> ARPANET

"Mobility" -> Osborne/Panasonic SrPartner + modem

"Big data" -> Insurance actuary tables/WallStreet/WallMart et alia

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Anonymous Coward

Hit the nail on the head

From personal experience I think this analyst has actually hit things on the head.

The nearly 10 years its taken from Spinnaker -> Clustered ONTAP is just a bit of a joke, and having arrived at the destination, it is not the holy grail that will allow the company to build on. Having to now build a separate platform to deal with Flash says this.

Its fine to sacrifice the sacred cow that is ONTAP, WAFL etc, however suddenly appropriating a bunch of disperate platforms does not a strategy make.

The leadership issue is also a big one. Not just at the upper levels - the mid to lower levels too. People are frankly asleep at the wheel while new and existing competitors start to take the growth position that made NetApp admirable. And it is a company very much to be admired a - proper silicon valley success story that any other startup would kill to emulate. However if things continue as they are I expect the next phase of its history will be how it was bought by IBM and disappears into the history of time.

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Anonymous Coward

Re: Hit the nail on the head

Possibly A Larry takeover instead of IBM?

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Anonymous Coward

Re: Hit the nail on the head

I don't see anyone buying NetApp at their current market cap of $12.x billion. It would take about $15 billion to acquire it outright, which is pretty rich.

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Anonymous Coward

Re: Hit the nail on the head

This is a tough time for any company. They are growing so fast that they have to relax their hiring standards letting in mediocrity. Companies become complacent and wither away when these mediocre people start settling in the middle management. That is the case now with NetApp. Folks like Tintri, Nimble are eating their lunch as EqualLogic did until they got hit by the Dell-berg.

Having a skunk works division (also called as 'XYZ Labs') is good for developing new products/technologies, but the OP got it write that sometimes you have to sacrifice your core for future growth -- reallocating resources. For example -- can Super Micro design and produce a better HW solution that both Tintri and Nimble could use versus NetApp. The answer is yes (doubly so since NetApp HW has hit a complacency iceberg)-- take that sacred cow and invest in other areas.

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Anonymous Coward

IBM don't need to buy them though.

I wonder where the analysts of William Blair think the "cloud" lives though, if not on highly tuned disk based storage systems?

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Anonymous Coward

If IBM was going to buy them, they would have bought them five years ago. They now have a strong storage portfolio without NetApp/N Series. I think they will continue to develop XIV as their tier one platform with DS8 pretty exclusively for mainframe and System i integration. If they add frame federation to XIV, which they can do seamlessly, it has all of the characteristics of the storage platform of the future PB scale storage where RAID management and tiering is impractical. Scale out, grid/clustered based, with I/O spread wide across all of the drives and performance managed at the QoS level, and a great pre-fetch algorithm into a huge cache. Add GPFS for file. That is solid for 95% of the workload, the extremely high performance and low latency workload requirements can go into Texas Memory or internal PCIe Flash.

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XIV is definitely an 'interesting' architecture for the 'cloud' but has 2 main issues - power and density.

243TB usable in a rack really isn't that special and when you're building a multi PB cloud then density matters. And even more important is power draw. XIV3 used 8.4kW ... that's a lot of power for 243TB. A comparable 3PAR array, even if you feel the need to spec it fully with SAS drives rather than 7.2k nearline, only takes 31U and 5.4kW. And there are much better ways of hitting 243TB, with good performance, so in reality a 3PAR array would take less than half the space and less than half the power. Could be why 3PAR is in 8 out of the top 10 service providers.

XIV isn't really dense enough for big data, or have enough performance for Tier 1. It does seem a reasonable fit for that Tier 2 type space but so do a lot of other products!

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Anonymous Coward

I have never used or closely looked at 3PAR so I can't speak to it, but I would say this for XIV....

XIV does have 243 TB, so approximately 50% usable vs. raw. That is due to it using the same mirroring algorithm on all data instead of traditional RAID stripes, like 5 and 6. Could you get better utilization by manually RAID striping data and carving out arrays in the traditional approach? Sure, but that has limitations at high scale and high variability. There is no way a "cloud" provider is going to be able to carve RAID out for every host at the outset, so a lot of there will be a lot of stranded space. Even if you could create a RAID plan for a high variable workload set, you would have to hire a bunch of people to manage storage which would not be necessary with XIV's approach. While people can theoretically do better than 50% utilization, very few do better than that in practice because it requires a lot of knowledge about what the storage environment will look like 2 years down the road when you set it up and constant management. VMAX, for instance, is supposed to have a real world average of about 20% utilization or something in that range... can't remember the exact figure but less than 50%. Even if you can get slightly better utilization, the costs of the staff will overcome any savings you might have of fewer modules of relatively inexpensive disk. You don't have to touch it with XIV or make any decisions... which, at scale, is not only good but almost required.

XIV can run at up to 8.4 Kw, max, but it is usually lower. XIV does have 15 CPU modules in a rack which I would think would be where a lot of the energy is used being that 7.2 drives don't pull much energy. Another system might require more arms to achieve the performance levels or peak hot spot avoidance of XIV's 15 CPU modules per rack which might require more than one rack in the other system to achieve apples to apples, so it is difficult to compare a rack to a rack for workload requirements because a rack of XIV is basically a server dense rack whereas other systems are primarily a bunch of drives.

"Could be why 3PAR is in 8 out of the top 10 service providers."

I imagine the top 10 service providers probably have a few of every major storage array in their data center. If 3PAR can claim that they have 200 PB under management in prod at one of those service providers, that would be interesting.

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As you correctly mention at the start of your post, you have no knowledge or understanding of 3PAR. 3PAR doesn't use traditional RAID sets either, widestriping all day across all drives in the array, so the management issue you raise isn't really a point. It also allows many 3PAR customers to drive extremely high levels of utlisation, greater than 90% in some cases. Compare that to the huge amount of wasted space in the XIV! As I said, a 243TB 3PAR system using higher performance drives and with wide striping so no hot spots, uses 30% less space than an XIV. The arguments you raise against VMAX are the same ones 3PAR would raise, so you are validating the 3PAR messaging. The difference is 3PAR is a lot more efficient both in terms of space and power.

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Interesting that this gets posted during NetApp's fiscal year end

Hello all,

Dimitris from NetApp here (www.recoverymonkey.org)

I did find it interesting that such a "doom and gloom" article is posted during NetApp's fiscal year end.

Sure - we are an incumbent now, having the #1 storage OS in the world: http://searchstorage.techtarget.com/NetApp-Data-ONTAP-Is-Now-the-Industrys-No-1-Storage-OS (this is by revenue - the same holds by sheer capacity, too).

It's similar to the attacks Apple receives. Another company that innovated and was "different" and now is bigger than most. And they're not going anywhere despite all the attacks. And they're not stopping to innovate.

Innovation needs to be followed by a maturity period to encourage broad adoption of said innovation.

The various flash arrays out there for example offer innovation but not maturity yet - and these waves of innovation and maturity can take years.

Check out the "Hype Cycle": http://en.wikipedia.org/wiki/Hype_cycle

Thx

D

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Re: Interesting that this gets posted during NetApp's fiscal year end

Oh - maybe the analysts should read this:

http://www.barnetttalks.com/2013/03/the-slow-incumbent-myth.html

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Meh

Re: Interesting that this gets posted during NetApp's fiscal year end

Dimitri - That graph does make me laugh... if you combined EMC's storage products together it would be way above NetApp.

I like NetApp dont get me wrong but it will be interesting to see how long the one box for all approach lasts.

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Re: Interesting that this gets posted during NetApp's fiscal year end

Or that they can hit a regular refresh cycle that matches others. Their current boxes are usually one or two generations behind the competition including 3PAR.

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