16 posts • joined 18 Jul 2012
You want list prices, but they cannot afford to publish them.
I can think of plenty of reasons they don't publish list pricing, but let's focus on just one - their route to market and I'll provide an example too.
Cloud based services - have a unique utility based go to market and some specific product and market characteristics. They can be priced and consumed by any unit or time period desired, they can be turned on and off, they can be trialled quickly and in most cases provisioned automatically. There is much less complexity in their service for an end user to worry about and most provide clear SLA's, so it could be perceived risk is less. But one of the clear reasons why they publish pricing is the commercial engagement between the service provider and the end user. Most cloud players lack a channel, or even a need for one. The decision making process and subsequent transaction is very clean in most instances. And because of the very competitive nature of the cloud market and lack of service stickiness, the pricing changes quickly and the winner is the one that best adapts to changing market conditions.
So let's look at a product sale. What's actually different? Well, because it's a product and not a service, the commercial model is entirely different. It's consumed differently and it's go-to-market in many instances requires the use of a channel, which is what complicates matters, as there is a third party variable which, depending on the type of partner and level of value and support is provided as part of the sale, changes the overall cost of the solution. This could turn into a very long reply. So let's look at an example which can perhaps best illustrate why modern enterprise storage systems do not readily provide list pricing online and purchase prices vary. You want to purchase an all flash array and you find 2 vendors that look interesting, lets assume the both publish their list prices, and let's play out a procurement scenario (these are made up numbers, don't read anything into them).
Vendor A - 20TB £150k SRP
Vendor B - 20TB £75k SRP
Let's assume on paper they all look like they'll do a job, because they have similar feature sets and roughly the same hardware.
You are immediately drawn to Vendor B because of the cost. So you ask yourself, how did they get the price so low? In your head perhaps you are now thinking that Vendor A is overpriced, you start to discount them, even your procurement teams are finding it hard to justify the extra cost of what seemingly is a similar solution.
Vendor B has adopted a cloud sales model and aggressively priced and promoted their solution, for wide market penetration. They don't use a channel and are light on sales resource. You make an inquiry and they give you a price, pointing you back to the web to get it. They happily provide technical support over the phone, and now you want to test it, you know, just to make sure! "Sorry, we don't provide units to test - but you can look at our GUI on the web and try out the management interface". Why don't you provide units? "Cost of testing and managing them is too high, we don't have the resource to integrate them on-site" (they'd never say that of course but would find a suitable excuse that means the same thing). Can I buy them from a channel partner? "Sorry, we are priced aggressively for the market leveraging a direct sales model" I'm sure you get where I'm going with this. Suddenly because you cannot test the solution properly, you are now looking at Vendor A again. But your still get the hump that they are 2x on price. But they do it because they want to advertise themselves as a premium solution and they have many resources and a channel to feed. They are helpful and supportive, a vendor guy comes to see you, and he turns up with your incumbent integrator, they help you test a box, provide free consultancy offer to support you with the integration. Indeed, the integrator help optimise you application environment to make better use of the solution you are interested in. All good stuff, but you still cannot get over the 2x cost. Surely, all the value is not worth that amount. So you decide to try and negotiate. Strangely enough they respond and you get the price down a bit, your procurement steps in and it gets down a bit more. Then you are left with a decision, go with vendor B, who's adopted a cloud service sales model, all looks good - still lowest rice, decent specs - but you cannot test properly or Vendor A? who's been very helpful, you've tested the kit and know it works but remains the more expensive option?
Answer: you may go with either (probably A, because you don't want your arse kicked if it doesn't work out as planned). But they were the only two choices.
Now, here's the bit where it doesn't work. Look at it from a vendors perspective. Take Vendor A and other companies like them. In the real word, there isn't just vendor A & B, but C through to Z as well. So many options, where do you start? Well, you can't review and test them all, so you start by eliminating the ones with the highest price and the less attractive brands. But you haven't even tested their great product!? It could be the one for you! But .... "Yikes, I'm not paying that, premium solution or not", something gotta give.
So you see, in the real world, vendors don't want you to discount them by publishing list prices. There's no room to explain all the value you get for it, the channel that helps. You've discounted them based on a number. They are not going to survive very long are they? And because of the different type of go to market each vendor may take - 1 tier, 2 tier that value changes. How do you explain that in a list price? Simple. They don't publish them, so you cannot make that decision until you understand their proposition better and they understand you and your requirements.
If enterprise storage ever becomes truly commoditised, tested and sold off a page, then things might change, but the technology, channel and market landscape would look remarkably different to what it does now.
Re: Time to increase the budget
You'd be surprised. Many web companies have more than that already. Also the nature of storage management within the traditional enterprise is changing. There are hundreds of UK based orgs who have 1Pb plus of distributed and disparate storage silos (file & block, object & cloud, on multiple vendors technology, at different stages in their life-cycle). If someone could unify and consolidate that, not only would it drastically simplify data management and it would significantly reduce costs, but it would enable more people to access, more relevant data and make quicker and more informed business decisions. Think if the analytics angle too, much easier to run Hadoop if all the data is managed centrally. You also don't start with 50Pb, you start with a few hundred TB and scale, knowing that your'e covered. In the traditional enterprise file storage is growing at 50% per annum (block about 35%), It won't take long for a 500TB org to pass 2 PB (about 3/3.5 years). Think about it.
You won't have too :-)
Pricing is super aggressive. It certainly won't break the bank unless you were planning to throw the 4.8TB version in a Mac Pro. Everything is relative after all.
Re: I really worry what
We'll hopefully you won't have to do much. The pricing I've seen is very aggressive.
Suggest you try one and find out
Some comfort for the skeptic. A partner of mine has tested it recently (in the UK) and he concluded, I paraphrase "it took a while to warm up, but when it did it was as fast as anything else we've ever tested... and given the price it's a bit of a no-brainer"
AKA Tecevo S100
And can be had on Amazon for less than £20!
Re: What is it
SeverSAN has a big future of performance optimised storage. It's not the only route, there are plenty of other choices but the performance vs cost arguments are very compelling. It won't be for everyone, and for others there are all flash arrays, hybrid arrays etc. There's a home for all of them. And yes, the basis of the concept has been around for a while, but a number of things had to change in order to facilitate the growth of this technology - the key one being the accelerated pace of solid state memory development, both from a technical and cost standpoint. Drawing parallel's, you need look no further than object storage. It's been around for ages, yet why didn't it take off before? Customer need. Problem is object storage is now not a technology looking for a problem. Explosive growth of file data is the problem, and object is now the only technology which can scale economically to support it.
What about the impact of software defined storage?
Always eager to read your blogs and, either by hope or design, they really are a reflection of what I am seeing in the market. I have a diagram, which I discuss with my partners, which pretty much summarises all the external influencing factors you ahve mentioned such as big data, but also includes mobility as I believe this will also help define reuqirements of future storage architectures.
Interestingly, smack in the middle of my graphic, sandwiched between high performance flash/hybrid and scale-out file/ojbect storage is software defined storage. Now technically, SDS is really an overlay play as one could argue that any vendor who deloys their storage on supermicro servers is infact an SDS player (or at least has the potential to be) beit T0 flash, T1 SAN/NAS arrays or T2/Archive scale-out oject stores. So, I was curious, why no mention of SDS in your blog? Is it too immature to have an impact in the foreseeable? are there not enough vendors visible to make it a relevant conversation right now? Would appreciate your thoughts.
These tables hold very little credibility. Practically worthless. There are no apples for apples comparison's here. The are comparing SAN's, NAS's, Unified Solutions, Hyperconverged Platforms, Scale-Out File Systems and Object Stores. All have a different role to play in cloud storage.
Adoption will be driven by customer need
I agree with almost everything you have stated here Martin. There is a definite case of SDS from traditional NAS/SAN through to scale out object storage (I think there may be a case for flash/hybrid arrays, where performance guarantees require dedicated platforms), but the speed of adoption will depend on a number of parameters.
1) End user/Integrator skill set
2) Knowledge of the market, options
3) Uses cases/ references
I believe the complete abstraction, ie software on ANY platform, is a little way off yet. It'll require more general confidence in the software technology first. I see no issue with compatibility lists or validated commodity hardware delivered as part of the solution, as things stand. Look at the general move towards prevalidated technical stacks such as Vblock, flexpod, vspex etc, there is huge customer demand for those type of solutions, as it removes much of the complexity and operational cost when rolling out services. I thinks we need to get to this stage first in the storage market (for all the same reasons), before we start talking about storage software on ANY platform.
It's not just cloud
Love the article Chris, whether you are right of not, at least it creates conjecture and debate. I believe the cloud will have a big part to play in the rapidly evolving storage market, but the solutions have their challenges currently. I don't buy cost and security as inhibitors. This stuff is cheap (although their pricing models are pretty confusing currently) and their security is well architected, they dont have a business if it isn't! Their challenges are latency and issues around data management (lock in was an issue smeome described earlier).
However, in the short term i dont believe cloud will be the only challenge to legancy storage arrays. For a number of reasons - flash, hybrid, object and software defined storage based solutions will eat into their market as companies evdeavour to improve the speed, scale or cost reduction in storing and managing their data.
Re: I'm not convinced
What happens when all the applications and processing are in the cloud? Pipes are an issue now, but the whole compute model has an opportunity for change too. Then its not pipe size but avaiability that becmes the problem.
Re: All Flash. No Cache
"There is definately a place for all-flash arrays but hybrid will capture the mainstream"
That will depend on the economics of AFA's. When SSD's achieve cost parity with HDD's, there are limited reasons to need a hybrid solution. I see hybrid currently as a transitional play for the next 3/4 years, those hybrid vendors that can gain a significant enough footprint before the SSD vs HDD commercial tippingpoint is reached will be in a strong position to capitalise on the opportunity.
Re: This drive technology needs a new name,
Given the fact you are reading an article in the storage section of a website by a well renowned storage journo, I hope your comment about Adobe was a joke :-)
Phone calls are way more annoying than the texts. We get at least 1 every day. I would love to see this practice stop in it's tracks.
It's not just about saving direct costs
Agreeing with others here and those in the main article, it's about increased security and improved productivity as users can publish their desktop of applicaiton to a number of different devices and access them in the most convenient way. It's also about enabling scale, managing moves and changes. It's far easier to deploy and manage new desktops using VDI model.
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