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Which Converged Infrastructure Should I Sell?

Posted by Bruce Gilroy on Apr 21, 2016 11:51:24 AM

“So which converged infrastructure stack should I hang my hat on?  Which is the best one?  Which one is growing in the market?  Which one will still be around in a few years? Which suppliers are really supporting the channel?  Where should we invest our resources and focus, you know we want to grow our revenue and customer base, right?  And margin, we need to be profitable, of course…

Since we regularly hear some variation of these questions, I thought I’d offer my perspective.

FlexPod
FlexPod is the result of a long-standing partnership between Cisco and NetApp.  FlexPod solutions combine Cisco Unified Computing System (UCS), Cisco Nexus Switches, NetApp FAS storage and VMware or Microsoft hypervisors. The FlexPod architecture has been around for several years.  As a result, it is very stable and fully supported by both Cisco and NetApp. As the name implies, FlexPods were designed to be flexible, with many options and configurations available. FlexPods are even available pre-racked and validated by Avnet. Over the last few years, Avnet has built, tested and shipped hundreds of FlexPods for our partners. Additionally, Avnet’s exclusive FSA One Frameworks now allow us to quote FlexPod solutions in hours and ship fully integrated systems in days.  So FlexPod is clearly the right choice for Cisco and NetApp partners.

Vblock
Of course, VCE Vblock also leverages Cisco’s industry leading UCS server platform. Originally a joint venture between VMware, Cisco and EMC; VCE is now majority EMC owned. Vblock systems integrate Cisco networking and compute, EMC storage and VMware virtualization into a single factory integrated appliance. Vblocks are engineered as one system, with ease of deployment and management, security and scalability in mind. Additionally, VCE provides one-call support for the entire system. With several Vblock models, from entry-level to enterprise scale and workload optimized solutions, VCE has a proven track record in enterprise data centers. So VCE Vblock is an outstanding, high-growth solution for EMC and Cisco partners.

HPE ConvergedSystems
But HP was an early innovator in the converged space, as everyone knows.  They were building converged systems seven years ago with HP BladeSystem Matrix.  The current HPE ConvergedSystems have come a long way since then, combining Gen9 blades, 3PAR storage and a choice of HPE or Cisco switches.  All managed with HPE OneView as a unified management layer.  OneView, which is actually a really good management tool, is also used with their hyper-converged systems (well, ok not the full version but supposedly that’s coming soon…) and their recently announced Synergy architecture.  In addition to general virtualization platforms, HPE offers several ConvergedSystems that have been configured and optimized for specific workloads and applications.  While HPE has had some distractions over the last couple of years, the new ConvergedSystems are extremely stable and flexible platforms and we are seeing that reflected in recent market share growth.  So clearly HPE ConvergedSystems is a great option, especially for any partner aligned with HPE.

VersaStack
Now there’s also this little company called IBM that, amidst a series of strategic divestitures over the last several years, has managed to hold on to some very good storage technology.  VersaStack combines IBM Storewize technology with Cisco UCS, Nexus/MDS switches and UCS Director to create a solid converged stack that can appeal to both Cisco customers and IBM’s storage install base. Avnet’s integration capabilities allow us to provide partners with a fully integrated, application-ready VersaStack that is shipped complete to your customer, ready to deploy.  So VersaStack is an ideal choice for Cisco and IBM partners.

HDS
While not a market share leader in converged, HDS storage arrays have a large, loyal enterprise install base. The HDS UCP converged solutions combine HDS storage with flexible compute and networking options.  The UCP relies on HDS compute nodes, with the option to incorporate Cisco UCS in the UCP Select platforms.  While UCP won’t be competing on price, these are good products, they work and they can leverage Hitachi’s loyal install base.  So certainly HDS UCP is a relevant option for Hitachi and Cisco partners.

Remind me again why I care about converged infrastructure? Because IDC estimates worldwide converged infrastructure revenue will grow from $9.8B in 2014 to $17B in 2019 - that’s a 12% annual growth rate.  The annual growth rate for non-converged infrastructure spending: -1%.  The point is, if you are still largely focused on selling stand-alone servers, storage arrays, switches, etc., the math is against you.

Ok, so who’s number one? Well, per IDC market share reports from the last couple of years, it looks about like this:
VCE, FlexPod and HPE consistently have the largest share, generally between 13% and 30% (yes, I realize that’s a fairly large delta). It will vary by several percentage points either way based on the quarter and whose numbers you like, but they seem to average between 15-22% market share. HPE has been in 3rd place but seems to be showing a more rapid growth rate recently.  VersaStack is pretty new but we’re seeing some traction.  Market share notwithstanding, some of the other converged solutions are ideally suited for certain customers and business scenarios.  Want to complicate things further? We could always include Oracle, whose converged solutions have largely consisted of Oracle application-specific platforms but rival the aforementioned 3 players in revenue and growth. Next time.

What about hyper-converged? While hyper-converged solutions are usually lumped under the converged infrastructure category, they are very different from traditional converged infrastructure stacks.  That said, IDC estimates that hyper-converged sales will grow from approx. $400M in 2014 to almost $5B in 2019.  The specific market share numbers for hyper-converged are a bit tricky, as the big players like Cisco and HPE have only recently engaged in a big way.  For our immediate purposes, let’s just say the growth trajectory for hyper-converged systems is huge, Nutanix remains a leader but HPE, Cisco and EMC/VCE are rapidly and significantly engaging in this space.

Keep in mind data center infrastructure is a very dynamic market, with continual innovation being the primary constant, that’s about to be disrupted again (I think) as composable infrastructure solutions begin to enter the market. Read my last blog for more information around composable: Composable Infrastructure –What is it and Why is it so Important?

Now you may be thinking, “wait a minute…you didn’t really narrow the field at all.  You didn’t answer which CI solution is the best one to get behind, to build capabilities around…”

You’re right, I didn’t.  What I did (hopefully), is to reinforce that there are relevant differences between the leading CI stacks, that they all continue to innovate and there is no clear “best” solution.  It will depend on your customer’s preferences, their skill sets, supplier relationships, as well as your own.  My hope is that you walk away reminded of converged infrastructure’s growth trajectory and increasing dominance in the infrastructure market, and the importance of aligning to that market reality. I hope you take away that, as an Avnet partner, you have expert resources to draw upon. You have access to sales, technical, marketing and solution specialists. Avnet has built dedicated practices with extensive capabilities around go-to-market support, sales enablement/acceleration and world class integration services to help guide and support you and your customers with converged infrastructure solutions.

 

Sources:

*IDC, Worldwide Converged Systems Forecast, 2016–2019: Special Report, Doc#US40940816, Feb 2016

*IDC, Worldwide Converged Systems Revenue Increases 8.5% Year Over Year in the Fourth Quarter of 2015, Surpassing $3.1 Billion in Value, Press Release, March 2016

*IDC, Top 3 Vendors, Worldwide Integrated Platforms, First Quarter of 2015

*IDC, Top 3 Vendors, Worldwide Integrated Infrastructure, First Quarter of 2015

Tags: Cisco, Hitachi, hpe, IBM, NetApp, vmware, Converged Infrastructure

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