Rumour has it Nutanix is talking to Pernix Data about a possible acquisition. It could be a good thing for them and, of course, their customers.
All DCs are brown fields
If Nutanix’s masterplan is to become the management platform for any datacenter, they have to expand their product line. They are already at it, as I wrote a few weeks ago, but it could be necessary to do more and faster to fuel the growth the market expects from them.
The technical reason is simple. Now they can manage HCI, physical workloads (thanks to the introduction of iSCSI volumes exposed to external servers) as well as the cloud, but they still need another piece to complete the whole picture. They need to include existing “legacy” virtual infrastructures.
For the vast majority of enterprises it’s not easy to change existing architectures and the lifecycle of infrastructures is between 3 and 7 years. In some cases server and storage purchases follow different paths and have different time frames making it harder to adopt an HCI infrastructure. All of this can undermine Nutanix’s success rate. Giving options to the potential customer means Nutanix can facilitate the migration by moving component after component, when needed. Once the end user has adopted Prism, Nutanix management platform, it’s much easier to do upselling and manage the transition to HCI in a much more seamless fashion than today.
Cache is a temporary solution
I was skeptical from the start: cache is just a feature after all… and even worse, Flash prices have dropped so quickly that it is no longer needed for new infrastructures.
Don’t get me wrong, Pernix is a lovely company, with a nice product which offers real benefits if you have an old, disk based shared storage infrastructure. But, it becomes useless (or less relevant) when you migrate to a modern Flash array or HCI (or cloud). Yes, we could argue that Pernix has an analytics feature now, but let me say that it is too little too late.
Pernix is scrambling to find additional funding, but its user base isn’t growing enough and today VCs are less inclined to give money without the necessary guarantees of future success. At the same time, there are rumors that many people at Pernix are job searching elsewhere (not a good sign).
But, again, the fact that cache is a temporary solution is great for Nutanix. They can cover more workloads and pieces of the infrastructure while giving options to their end users. Just one more feature for its platform, and it could be added to the portfolio as a subscription instead of a full license.
Closing the circle
I think it is of interest to note that Nutanix took out a loan of $75M one month ago. Most pundits agree that they need that money because of the delayed IPO. I’m sure it’s true, I’m not a financial analyst after all, but how about a smarter move? In fact, Pernix is not profitable at all and they raised $62M in total. $75M seems legit to repay investors and buy all the intellectual property… I don’t think you can ask more than that if you want to save that company and investors’ money at the same time.
Nutanix is one of the most aggressive companies I have ever met. They have a plan and they are pushing hard to realize it. Pernix could be another bullet in their arsenal… or, let me be cynical here, it could also be that one hand washes the other (and both wash the face?). Not clear??! Well put it this way: they help some investors to get their money back, then these guys are more than willing to invest more in Nutanix or help to make the IPO a success.
If you want to know more about this topic, I’ll be presenting at next TECHunplugged conference in Amsterdam on 6/10/16 and in Chicago on 27/10/16. A one day event focused on cloud computing and IT infrastructure with an innovative formula combines a group of independent, insightful and well-recognized bloggers with disruptive technology vendors and end users who manage rich technology environments. Join us!