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CommVault now sees a point in smaller bundles

For years, CommVault boasted about how it sold one application that handled all data protection and management needs. That is changing, as its tries to perk up tepid financial growth in a more competitive market.

CommVault CEO Bob Hammer said the one-stop shopping approach still helps with large enterprises, but point solutions are the best way to expand business. That’s not a new strategy – CommVault has already launched the first handful of these bundles. But Hammer said the company is expanding that strategy with a new set of point solutions ahead of the next full release of its Simpana software.

“Transformation” was the word of the day Wednesday on the CommVault earnings call.

“Many of the key elements of our current transformation are now in place and the pace of our transformation is accelerating,” Hammer said in his opening statement. “This transformation is designed to bring us back to historical financial performance in the second half of next fiscal year by implementing pricing, packaging, and distribution changes.”

When he turned it over to CFO Brian Carolan, Hammer promised “more details on our transformation” later in the call.

“Historical performance” for CommVault is year-over-year revenue growth in the 20 percent range, but the vendor hasn’t hit that number in four quarters. CommVault’s revenue of $153 million last quarter was roughly the same as a year ago, barely up from the previous quarter and below Wall Street expectations.

Deals of more than $100,000 in the quarter decreased by 24 percent over the previous year. CommVault’s average enterprise deal price fell from $284,000 a year ago to $248,000 last quarter.

“We’ve focused on the core issues that negatively impacted revenue earnings growth,” Hammer said. Those issues included “the shift in both the market and competition, which required significant changes to the pricing packaging messaging, as well to the go-to-market strategies of our products.”

That’s where the point solutions come in.

Hammer said CommVault in March will launch a cloud gateway for archiving “to all major cloud storage locations,” a disaster recovery manager that will run on Microsoft Azure and Amazon Web Services (AWS) public clouds, and a cloud DevOps services that will allow developers to create and use virtual machine workloads in the cloud for test/development.

Other products or upgrades in the works include an Edge Drive product that enables online file sharing and collaboration, and a service that can archive data in Office 365 cloud-based mail applications.

“New competitors entered the market with some pretty good standalone solutions, and if there were not alternatives to that, [companies] were willing to deploy them,” Hammer said. “But now we’re giving our customers the best of both worlds, the ability to deploy standalone in certain situations or deploy a unified platform.”

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