I love the architectural concept of HCI. Collapsing storage, compute and possibly networking into a single set of x86-based nodes is a brilliant idea. Place upon that a software management overlay and you have the makings of a private cloud. My pause? I'm not convinced this to be a standalone product category.
During the year-end episode of the PacketPusher's weekly show. I asked the question, what's the long-term viability of HCI as a standalone product. Is it a feature of existing big vendor server and storage solutions, or is it something that sustains a $4B+ company in Nutanix.
During off-mic banter, I asked the pointed question, what stops Nutanix from being the next Violin Memory vs. the next NetApp/EMC? What is it that they do that Dell EMC, HPE or Cisco can't eventually replicate? Of the major vendors, HPE has had the most trouble developing a robust HCI solution. The purchase of SimpliVity puts them back into the discussion. I discuss that in the video below.
It leaves the question of Nutanix. What's the long term play? If you are a large enterprise what's the value of Nutanix beyond a VDI enclave? How does it play into your overall data center and cloud strategy? And will customers buy enough from Nutanix to justify the $4B+ market cap?
I haven't seen enough from Nutanix to answer this question definitively. They are now an Enterprise Cloud company. There's validity that Nutanix holds potential as the foundation for a private cloud enclave. Similar to the VDI use case that brought attention to the business, private cloud infrastructure is a set aside that Nutanix fits.
Leveraging an all Nutanix infrastructure for private cloud, enterprise engineers turn their focus to customer facing data center bits such as Kubernetes. The question, is there enough of the market that buys into Nutanix' vision vs. a Dell EMC, HPE or Cisco infrastructure vision?
I wrote a piece over on TechRepublic that explores the topic. The purchase of SimpliVity has repercussions. As of the time of this writing Nutanix' stock price fell 3.5%. HPE only paid $650MM for SimpliVity. The price was much lower than the rumored $2B just a few months ago. I believe it's a reflection of the lack of height to the barrier of entry into HCI.