The News: Nutanix this week laid out its plans to capitalize on opportunities presented by the Broadcom-VMware deal, emerging generative AI market, its Cisco partnership, and customers’ focus on cloud cost optimization.
Nutanix Preps for VMware Takeover, Generative AI Wave
Analyst Take: During its virtual analyst relations event, Nutanix updated an overall strategy first laid out at Nutanix .NEXT in May regarding its transformation from a hyper-converged infrastructure player to a multicloud platform. Nutanix CEO Rajiv Ramaswami said the goal is to provide one platform to run all its customers’ applications and data.
Nutanix will try to take advantage of the following areas over the next year.
Project Beacon
First announced at .NEXT, Project Beacon is the first step in Nutanix’s plan to make data available from anywhere. It decouples application and data from infrastructure. It will start by making the Nutanix Database Service (NDB) available as a managed service in the public cloud. Nutanix plans to eventually deliver platform services with a single application programming interface (API) and console integrated with Kubernetes. The Project Beacon roadmap includes data streaming, messaging, caching, and AI/machine learning (ML). It is expected to be available in early access in 2024.
VMware Deal
The enterprise HCI market has come down to VMware and Nutanix virtualization and software stacks running on the leading server platforms. VMware remains Nutanix’s main competition as both companies transition to multicloud platforms.
Nutanix execs know VMware well. Ramaswami and two other speakers from the Nutanix AR event formerly worked for VMware. What no one knows for sure is what VMware will look like following Broadcom’s pending $69 billion acquisition. But Ramaswami said he expects Broadcom to follow the same playbook it used after other acquisitions, including CA and Symantec. That means focusing on its largest customers, increasing prices, and making cuts to its workforce. He said Nutanix’s strategy will not change but he is already seeing more opportunities from customers who consider it risky to stick with VMware. He referenced a large company that used Nutanix only in edge locations but recently brought it into the data center because of concern about VMware’s direction. Nutanix has long had tools to help customers’ migration from vSphere to Nutanix AHV, so it should not be difficult for them to bring customers on board.
Cisco Partnership
Cisco end-of-lifed its HyperFlex HCI after striking an OEM deal with Nutanix. Nutanix execs said they believe Cisco is all-in on selling Nutanix because it will help them increase market share for their UCS servers and HyperFlex was not a fit for hybrid and multiclouds. Nutanix now partners with Super Micro (used for Nutanix’s branded systems), Lenovo, Hewlett Packard Enterprise (HPE), Dell (yes, Dell still sells Nutanix Cloud Platform on PowerEdge servers), and Cisco. The Cisco deal gives Nutanix the potential to sell through more than 60,000 Cisco channel partners. (For HyperFlex customers, Cisco did state they would continue support for 5 years).
Generative AI
Generative AI fits with Nutanix’s strategy to become a platform for apps running anywhere, because generative AI will be deployed in public clouds and on-premises – wherever the data is. That data will have to be tuned and trained for generative AI. Nutanix in August launched GPT-in-a-Box, a server with NVIDIA graphics processing units (GPUs), Nutanix Cloud Platform, and unified storage packaged with MLIOPs tools such as PyTorch and Kubeflow. It is an interesting combination, but Nutanix will have to prove GPT-in-a-Box’s value and performance against generative AI offerings from almost every other infrastructure and cloud vendor.
Cloud Cost Optimization
Although he said it is not exactly like “a rock rolling down a hill,” Ramaswami said he is seeing some large customers repatriate their apps and data from public clouds. He mentioned an Indian bank that recently moved a mission-critical app from a public cloud to Nutanix on-premises. But he said the bigger opportunity is with customers looking to optimize cost and become “much more circumspect” before committing workloads to the public cloud. As with generative AI, this is both an area of opportunity and one where Nutanix will face great competition from both hyperscalers and large IT infrastructure companies.
Look into the Future
As highlighted earlier, Nutanix has many of the pieces and partnerships it needs to compete. It has also been adding cyber-resiliency in the form of ransomware detection and recovery capabilities. One area I would like to see clarification is container-native and Kubernetes storage, which I expect more to come from Kubecon meetings. In 2023, Nutanix entered a partnership with Red Hat to make OpenShift Nutanix’s preferred Kubernetes partner. I expect to see technical integration, but it has not been revealed as of this writing. During the analyst event, Nutanix execs said they support Red Hat, SUSE Rancher, and Amazon EKS, as well as the Nutanix Kubernetes Engine (NKE). Integrated Kubernetes support will be necessary for Nutanix to live up to its goal of supporting data and apps running anywhere, and I have not seen that integration yet from any of the partners.
Disclosure: The Futurum Group is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of The Futurum Group as a whole.
Other Insights from The Futurum Group:
Nutanix .NEXT 2023: A Focus on Multi-Cloud Puts the New in Nutanix
NetApp Gets Insightful on Generative AI, Cyber Recovery
VMware Explore: Key Themes and Announcements
Author Information
Dave’s focus within The Futurum Group is concentrated in the rapidly evolving integrated infrastructure and cloud storage markets. Before joining the Evaluator Group, Dave spent 25 years as a technology journalist and covered enterprise storage for more than 15 years. He most recently worked for 13 years at TechTarget as Editorial Director and Executive News Editor for storage, data protection and converged infrastructure. In 2020, Dave won an American Society of Business Professional Editors (ASBPE) national award for column writing.
His previous jobs covering technology include news editor at Byte and Switch, managing editor of EdTech Magazine, and features and new products editor at Windows Magazine. Before turning to technology, he was an editor and sports reporter for United Press International in New York for 12 years. A New Jersey native, Dave currently lives in northern Virginia.
Dave holds a Bachelor of Arts in Communication and Journalism from William Patterson University.
