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NetApp hybrid cloud remains vendor's focus with new CEO

NetApp didn't have much in new products at its annual Insight conference; the only rollout was Data Fabric for placing and managing data in a NetApp hybrid cloud.

So far, NetApp under CEO George Kurian looks a lot like it did before Kurian replaced Tom Georgens in June. At its NetApp Insight partner and user conference last week in Las Vegas, the vendor continued to push NetApp hybrid cloud technology and kept people waiting for its FlashRay all-flash array.

NetApp had one product launch at the show, devoting the four-day event to discussing its Data Fabric hybrid cloud technologies for managing data spread across traditional, on-premises storage and the public cloud.

Kurian stepped up from vice president of operations to replace Georgens after two years of declining revenue, difficulty getting customers to upgrade to its flagship clustered Data Ontap product and a flash strategy that did not resonate with users.

Kurian said his goal is to "sharpen the focus" of his predecessor, rather than make sweeping changes.

"Tom Georgens, my predecessor, worked tirelessly to lead NetApp during his tenure and we continue to build on many of the things that he started," Kurian said in an email interview. "I'm focused on sharpening the focus, and raising the pace on positioning NetApp to help our customers evolve their IT strategies and consider how to take advantage of the cloud while mitigating the risks."

Kurian maintains that Data Fabric gives customers what they want -- a path to using the cloud for storage requirements.

NetApp needs to be aggressive in adapting to change and fending off challenges from storage startups targeting small and midsize customers.

"We are in the biggest transition in the history of IT, and customers are looking for partners who can help them navigate," he said. "Our differentiated vision and architecture for the hybrid cloud [Data Fabric] is clearly resonating with customers and partners. We are focused on accelerating our customers' and partners' ability to adopt our industry-leading portfolio and achieve their business objectives." 

Camberley Bates, managing director at IT firm Evaluator Group in Boulder, Colo., said NetApp and its competitors face headwinds, as customers shift more data to flash storage and hybrid clouds. Bates said NetApp needs to be aggressive in adapting to change and fending off challenges from storage startups targeting small and midsize customers.

"I do think they need to get out a faster version of FlashRay," she said of the all-flash array, which has been in development for years, but is only in limited availability in a single-node model.

"They also are missing out on the hyper-converged market, which is peeling off some of the traditional data storage business. NetApp doesn't really have a product in that space right now," Bates added.

No new word on FlashRay all-flash arrays

NetApp counters claims that it is behind on flash by saying it has two all-flash platforms -- its All Flash FAS system and E Series arrays sold loaded with solid-state drives. But FlashRay is the only NetApp platform designed from the ground-up for flash, such as EMC's XtremIO, IBM's FlashSystem and competing products from smaller vendors, including Pure Storage, Violin Memory, SolidFire and Kaminario.

"We continue to develop FlashRay and selectively engage with customers around the use cases of the product," Kurian said. "We have integrated -- and will continue to integrate -- the ideas and differentiated intellectual property from FlashRay into our clustered Data Ontap software and our All Flash FAS product.

"NetApp has a deep and differentiated pool of intellectual property around flash," he added. "This IP provides us with a portfolio to help customers best integrate flash into their enterprise by combining proven flash performance and efficiency with mature enterprise data management, storage systems and software. That strategy has served us well. NetApp leads in flash innovation and has done so since our first introduction of Flash Cache in 2009."

NetApp said Data Fabric lets enterprises build hybrid public clouds, using NetApp storage hardware running its Cloud Ontap software. Customers can use it to set up multiple hybrid clouds for different workloads, such as testing and development, backup and disaster recovery. 

Cloud Fabric supports Amazon Web Services Simple Storage Service, Google Cloud Platform, IBM SoftLayer and Microsoft Azure public clouds.

Will NetApp's hybrid cloud strategy lift its fortunes?

But does Data Fabric alone provide the momentum NetApp needs to reverse its recent slide? The vendor in July reported quarterly revenue of $1.34 million, down 10% and marking its eighth consecutive quarter of declining year-over-year revenue.

Virdata uses a NetApp hybrid cloud to support its platform as a service, which companies use to collect and analyze data from any Web-connected device.

"The sheer volume the connected devices produce is enormous. The NetApp storage lets us replicate and store data at a cost-efficient point. We could not do what we do with traditional systems," said Catherine Von Aken, director of channels and partners at Virdata, based in Antwerp, Brussels.

Bates said the focus on data management makes sense, but NetApp will need to persuade CIOs that are using other vendors' storage to give it a try.

"The message of Data Fabric will resonate with a current NetApp customer, but they need to take that message to the level of the CIO," she said. "Most major firms probably have NetApp cornered into a filer relationship. What NetApp needs to do is talk about new data center architecture and show, step by step, how to build it out."

Kurian said that process is under way.

"We have moved from a single-product company -- selling to traditional storage environments -- to a company with a product portfolio that includes advanced capabilities well positioned for the next evolution of our customers' business and IT architectures," he said. "We are actively executing against the growing parts of our business: scale-out, software-defined, flash, converged and hybrid cloud data management."

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