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Tintri acquisition proposal leaves customers in limbo

DataDirect Networks sees Tintri's analytics and flash capabilities as an entry point to the enterprise, but Tintri customers remain in the dark about their storage vendor's fate.

While DataDirect Networks awaits the outcome of its proposed acquisition of Tintri assets, Tintri customers wonder...

what it all means for them.

High-performance computing (HPC) storage specialist DataDirect Networks (DDN) believes the Tintri acquisition is a way to appeal to mainstream enterprise IT shops. DDN made a bid to acquire Tintri's assets for an undisclosed sum after Tintri filed for bankruptcy in early July -- barely a year after going public on the Nasdaq.

DDN sees a way to broaden its appeal with Tintri's flash-based, analytics-driven storage arrays, but the acquisition isn't yet certain. The two vendors have signed a letter of intent, but the proposed sale won't be finalized until the completion of a court-ordered bidding process. That means bidders could emerge to challenge DDN.

Users react to planned Tintri acquisition

The uncertainly of the Tintri acquisition affects its customers, who remain unsure of what it means for their maintenance contracts. DDN declined to estimate how long the bidding process might take.

That leaves Tintri customers bracing for what comes next. The city of Lewiston, Idaho, used Tintri arrays to replace legacy storage. Systems administrator Danny Santiago said the hybrid storage was a "magic cure-all" for labor-intensive management. Lewiston's storage includes a Tintri T620 and two T820 hybrid arrays for primary storage, backup and replication.

"I spent about half my day fighting LUN management. When we got the Tintri, I got that time back," Santiago said. "I can go six months and never have to touch the Tintri storage. The interface is beautiful. It gives you metrics to let you know if a problem is [tied to] storage, the network or on the Windows OS side."

Now, Santiago said he doesn't know what to expect. His agency is in year one of an extended three-year Tintri support contract for the T620.

"Financially, we're not in a position to change our storage," he said. "We put a lot of money into these Tintri boxes, and we need to get the life expectancy out of them."

The Fay Jones School of Architecture and Design at the University of Arkansas installed Tintri several years ago to replace aging EMC Clariion storage -- the forerunner to the Dell EMC VNX SAN array. Scott Zemke, the Fayetteville, Ark., school's director of technology, said Tintri competitors have already started knocking on his door.

"Quite honestly, we rarely have issues with the Tintri arrays. But, of course, we're looking at contingency plans if we have to do a refresh. One vendor is offering ridiculously stupid deals to trade in our Tintri storage, so it will be an interesting next couple of months," Zemke said.

"I know Tintri really wanted the business to work, but it seems like they have just had management problem after management problem. Hopefully, DDN will continue to support the stuff. We have DDN arrays in our HPC data center, and they're a great company to work with, too," Zemke said.

Is predictive analytics key to Tintri acquisition?

According to Tintri's securities filings, DDN's bid would encompass most of Tintri's assets, including all-flash and hybrid virtualization arrays. But the predictive Tintri Analytics platform may have a greater impact on DDN's business. The SaaS-based data lake provides real-time analytics and preventive maintenance. Customers can automate capacity and performance requirements for each virtual machine.

Predictive analytics is considered a valuable feature for modern storage arrays. Hewlett Packard Enterprise considered Nimble Storage's InfoSight analytics a key driver of its $1.2 billion acquisition of Nimble in 2017, and HPE has since integrated InfoSight into its flagship 3PAR arrays. DDN could follow the same playbook by incorporating Tintri Analytics into its other products.

Financially, we're not in a position to change our storage. We put a lot of money into these Tintri boxes, and we need to get the life expectancy out of them.
Danny Santiagosystem administrator for the city of Lewiston, Idaho

Tintri's technology would help DDN serve mainstream enterprises seeking to implement AI and machine learning, said Kurt Kuckein, senior director of marketing at DDN, based in Chatsworth, Calif.

"We have plenty of organizations where we work with data scientists or the analytics team, but we really haven't had a product for enterprise IT shops. Adding Tintri gives us a well-baked technology and a large installed base," Kuckein said.

In the near term, DDN plans to maintain the Tintri brand as a separate engineering division. Real-time Tintri analytics eventually could wind up in branded AI ExaScaler turnkey appliances, he said.

Tintri Analytics is part of the Tintri Global Center management portal. The intelligence can predict hardware failures and automate support tickets. Tintri typically shipped replacement parts to customers by the next business day.

According to George Crump, president of IT analyst firm Storage Switzerland, Tintri's analytics are "as good, if not better," than Nimble's InfoSight.

"DDN is probably the perfect acquirer for Tintri," Crump said. "It's profitable. It has a massive amount of storage experience. And there's almost no overlap between the DDN and Tintri product. All the Tintri stuff would be net-new business."

Will DDN breathe new life into Tintri storage?

The proposed Tintri acquisition follows a rocky period for the vendor. Tintri filed for Chapter 11 protection this month -- just weeks after the one-year anniversary of its initial public offering (IPO). Some experts saw going public as a desperation move after Tintri failed to secure additional private investment. Tintri also went through two CEOs between April and June.

Tintri initially hoped for a share price in the range of $11.50 to raise about $109 million in June 2017, but its IPO opened at $7 and raised only $60 million. Shares rose no higher than $7.75, and Nasdaq eventually delisted Tintri after its shares dropped to below $1 for 30 consecutive trading sessions.

Aside from investors' lukewarm reception, several strategic missteps conspired to doom Tintri. Crump said the company undercut its key differentiators of analytics and quality of service (QoS) when it launched an all-flash array in 2015.

"Tintri's marketing message should have been, 'Don't buy an all-flash array, and here's why,'" Crump said. "DDN should get rid of the all-flash model and just focus on selling the hybrid arrays. When your system is faster than all of your workloads combined, then you don't really need QoS. That would get people's attention."

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