I had the privilege of attending the Netapp SolidFire Analyst day last Thursday- and rather than go through what the company told us (which was all great stuff), what I heard from SolidFire’s customers while there was probably more relevant and important.
I won’t repeat what’s been detailed elsewhere about the new capacity licensing model from Netapp SolidFire, which breaks the storage appliance model by decoupling the software license from the hardware it runs on. This new model, called “FlashForward”, allows for a flexibility and a return on investment previously unavailable in the enterprise storage market.
The service provider customers that participated in the breakouts unanimously agreed that this new licensing model was going to be a huge win for them. The most striking point was one service provider who had different depreciation schedules for software versus hardware – something that couldn’t be taken advantage of with the appliance model. Now, since the FlashForward program allows licenses to be moved between hardware instances, the software can now be depreciated over a longer timeframe (in this SP’s case it was 7 years). Hardware refreshes now come at a much lower cost in year 3-4. This all results in the ability to provision resources to tenants with a lower incremental cost per resource.
This could also have a major impact in the ability of companies to finance/lease SolidFire solutions- If you’re financing a given set of software over 6-7 years, obviously the monthly bill for that will be less than if you’re amortizing it over 3 years. Hardware remains at a 36 month lease with its typical residual. In a given year, that has the possibility of reducing cash out considerably.
Enterprise customers weren’t quite as giddy about FlashFoward as they were about the SolidFire technology itself; however the folks there were all IT, not finance. Service Provider folks tend to be more focused on the economics of resource delivery. The Enterprise IT folks were all about the “set-it and forget-it” benefits of their SolidFire implementations, with one customer stating that they only had to call support once in two years, for an event that wasn’t even SolidFire-related. Certainly, we had happy customers at the Analyst event, but their stories were all those of the challenges of choosing a smaller storage vendor (at the time), against major industry headwinds and having to justify that decision with full proof-of-concepts. Impressive stuff.
Of course SolidFire has made its name in the Service Provider market; their embrace of automation technology and the devops philosophy is recognized as leading the market. This is precisely why we should be keeping a very close eye on these folks, as Enterprise IT looks to become its own Service Provider, and automate its on-premises resources in the same manner in which it automates its cloud resources. Given this automation advantage and the acquisitional flexibility now offered, SolidFire is going to align very well with enterprises that have historically implemented the straight SAN storage appliance model but are looking to transform and modernize.