NetApp CEO Says Don’t Call NetApp A Storage Company
‘Storage is a part of intelligent data infrastructure, which combines unified data storage, intelligent services for data and workload optimization, and solutions that integrate those foundational capabilities with the big ecosystems that make it better for customers,’ says NetApp CEO George Kurian.
Storage Company Or Not
NetApp, with its leading role in storage hardware and software, is included in every legitimate list of storage vendors. Yet, if you ask NetApp’s CEO George Kurian to define his company, he will not call it a storage company.
“NetApp is the intelligent data infrastructure company. Period,” Kurian told CRN in a recent conversation that focused on how NetApp and the storage industry are changing.
Kurian, in his definition of NetApp, was referring to the San Jose, Calif.-based company’s push to differentiate itself, not as a storage vendor, but as a provider of intelligent data infrastructure to prepare for a world in which commoditized storage legacy models don't have a future play into the future and where intelligent services behind storage applications lead to business outcomes.
“Storage is a part of intelligent data infrastructure, which combines unified data storage, intelligent services for data and workload optimization, and solutions that integrate those foundational capabilities with the big ecosystems that make it better for customers,” he said.
Providing intelligent data infrastructure to technology requires coordinating services around data on premises, in the cloud, and at the edge, Kurian said.
“We think if you're thinking about unifying your data and unifying the storage of your data, you really need to think about a hybrid, multi-cloud world,” he said.
Kurian also shared his vision of the future of storage, one in which commoditized storage technology has no significant place.
“I think that the storage as a peripheral of compute, those days are over,” he said. “Storage is a discipline that is heavily software-focused rather than hardware-focused. I think that when you look at the companies that will succeed in storage and what I call intelligent data infrastructure, they will be highly focused and specialized in those domains.”
Kurian has a lot to say about intelligent data infrastructure, the future of storage, and the state of the competitive environment. What follows is CRN’s conversation with Kurian, which was lightly edited.
What is your latest definition of NetApp?
NetApp is the intelligent data infrastructure company. Period.
You don't call it a storage company.
Storage is a part of intelligent data infrastructure, which combines unified data storage, intelligent services for data and workload optimization, and solutions that integrate those foundational capabilities with the big ecosystems that make it better for customers.
At NetApp Insight, there was some talk about storage, with the new ASA block storage arrays and the new FAS secondary storage arrays. But storage seems to be playing second fiddle to intelligent data infrastructure. Is that a reasonable assessment?
I think what we see is that our storage is truly unified storage, meaning any data accessible by any method—file, block, and object—consumed in any way, as appliances or as software-defined or on the cloud, and truly integrated across the hybrid cloud. It is already industry leading. No one else has those capabilities, and we continue to make investments to bring out new innovations. You mentioned the new ASA arrays. We brought out new FAS products. We introduced new AFF products a little while back, and new AFF C-series a little while back. There's strong and ongoing innovation. What we think is super important for customers, in addition to being able to unify their storage, is to provide capabilities around intelligence services: data protection and security, compliance, the ability to understand your data, optimize the way you place workloads on the infrastructure, and so on. And when we refer to it as intelligent data infrastructure, we see that storage is an absolutely important part of it. But commoditized storage legacy models don't play into the future. You really need the intelligence services to make storage applications and business outcomes possible.
When talking about intelligent data infrastructure, what part do NetApp’s channel partners play?
There's a lot of opportunity for channel partners. It’s expanding the range of possibilities. First of all, in terms of storage and storage as a service, we have our Keystone as-a-service storage being delivered by channel partners who want to capture recurring revenue and build a managed service model for customers. The second is that security is an important topic for all customers in every part of the world. And what we bring uniquely to the security market is the ability to protect data as the first line or last line of defense. As our partners talk to clients about risk mitigation and cyber resilience, we bring a really important part of the solution stack for them. The need to detect when an attack is happening and the need to recover from an attack as quickly as possible is paramount, because even if you have really good threat protection models in place, there is a high likelihood that somehow you might get compromised. And so we create new opportunities for partners to engage in security. And then with respect to AI, we have said we are trying to bring AI to enterprise data and make it a lot easier to do that, which overall increases adoption by end customers and in turn makes it a profitable business opportunity for our partners.
What do you expect from your channel partners in order for them to be ready for intelligent data infrastructure?
It's really about learning about the capabilities that we are bringing to the market, enabling their teams to go out and have those conversations with customers, and building new business models and new business streams.
Intelligent data infrastructure was a key focus at NetApp Insight this year. Just a couple years ago, the focus was on NetApp Data Fabric. We don't hear much talk about Data Fabric anymore. What’s happened?
We've implemented the Data Fabric. When we started out as a company, we were the pioneers of unified storage. From 2002 to 2011, it was all about unified storage across data types at that time, file and block. Now we've got object. At that time, it was really about unifying data on a system. Then we laid out the technical architecture for how to build hybrid multicloud, which was Data Fabric. We've completed that journey for the most part. And so when we talk about intelligent data infrastructure, we've included data fabric as part of its unified data storage component. We think if you're thinking about unifying your data and unifying the storage of your data, you really need to think about a hybrid, multi-cloud world. And so Data Fabric is alive and kicking. We've completed the journey and that vision, and we're now extending our horizons.
NetApp talks about intelligent data infrastructure in a hybrid multicloud world, but all the talk is around AWS, Azure, and Google Cloud. What about other clouds like Oracle, IBM, or even Alibaba in China? Is NetApp not working with these other clouds? Or do you have any plans?
IBM Cloud is a very large customer of NetApp, and so we do a lot of work with them. We haven't ruled out working with other clouds. I think it's important for us to complete the journey with the biggest three clouds and then go from there.
How did NetApp become so intertwined with what's happening with the top three cloud providers?
It's been the result of a decade of work. There is a value system that we hold that drives those strategic decisions right. That value system is, if our customers want the capability to do something, it is in our interest to enable them to do so. And then the second is, we've always believed that it's better to build a bigger pie with others that we can share instead of trying to build a smaller one that we can control ourselves. Those are the two foundational values that we held dear with a combination of humility and quiet confidence. Quiet confidence that our technology was distinctive and that we were really good at what we did, and humility to say, ‘Listen, we're not a cloud provider. We're going to work with cloud providers to enable value for customers.’ And over time, we have been blessed to build great relationships with people at these cloud providers that trust us, that enjoy working with us, that co-create with us and do things that help customers progress their businesses in ways that honestly I couldn't have imagined 10 years ago when we started the journey.
Does working with cloud providers to bring more of the customers’ data to the cloud using NetApp technology cannibalize business from NetApp’s own on-premises storage business?
I would point out a couple of things. We said that three out of six cloud customers are new to NetApp, meaning we are serving a broader base of customers than we ever have before. We also have NetApp customers who are moving workloads to the cloud. Listen, it's better for us to enable them to make that move with our technology than to lose it if we didn't have our technology in the cloud.
What is the competitive environment as the storage industry expands to the cloud and adds new security and intelligence capabilities?
The competitors have a long way to go to catch us. I think most of them grew up through disparate acquisitions and have multiple operating systems that have disparate operating experiences for customers. And so the complexity when you have a portfolio of different operating systems is very high for the customer. We're taking share from companies that have those backgrounds. I think no one else has had the kind of foresight or maybe the discipline to do what we did in cloud, and so we have a strong lead there. And I think the value that we have created in cloud also helps us in AI, because many of these cloud players are big and important players in AI, and so we are well positioned. We need to stay humble and focused and go after our business.
It’s interesting that as NetApp is expanding its block storage capabilities, at the same time, one of your competitors, Pure Storage, which came from the block side, is busy pushing now heavily into the file side of the business. Is that a coincidence?
You can ask them that question. I think we've always believed that block was a part of a unified storage architecture. We've got more than 20,000 customers who will use NetApp for block storage. That's more than most competitors. It’s our entire customer base. And I think what we realized was, there were customers who said, ‘I have different teams for block and file, and I want the block team to have a system that's tailored to their environment, which is why we brought out the ESA.
What do you see as the future of the storage industry, whether it’s traditional storage where NetApp came from in the past, or the new things around storage that weren't envisioned even just a couple years ago?
I think that the storage as a peripheral of compute those days are over. Storage is a discipline that is heavily software-focused rather than hardware-focused. I think that when you look at the companies that will succeed in storage and what I call intelligent data infrastructure, they will be highly focused and specialized in those domains. We think that the storage world without intelligent data services is of diminishing value to customers because of two or three fundamental reasons. One is the business need to unify data, explore it, and select it so that you can use it easily in different applications. That is ever more clear with the advent of AI and generative AI that can look at all of your data rather than a subset. And so you really need to unify your data.
The second is, cloud has become an integral part of customers’ IT architectures, and so having storage or data landscapes that are not integrated with cloud is really out of date. And I think the third is this notion of having the capability to have intelligent understanding of your data to be able to protect it and to apply governance rules to it. Those requirements are already on us. We’ve already seen that in legislation coming in different parts of the world.
So I think storage and intelligent data infrastructures have become one thing rather than two things, and those companies that are in storage but don't have software expertise will fall behind. Those companies that have disparate operating systems and technical debt from having such a complex and disparate portfolio are in trouble.
It seems the number of storge startups is falling compared to the past. Why is that? Are we seeing a slowdown storage innovation, or is something else happening?
First of all, it requires a lot of time to build a reliable, highly available storage system. In general, it takes about seven to eight years to build a mature system. Some of that is because of the way storage systems operate. You've got a lot of disparate technologies that you gotta unify to make that really work, and it's hard in a venture environment to bet on something for seven years with no clear view of an outcome. Second, I think there have been a lot of investments that went into prior leaders of storage, and nobody really saw much outcome from that. And so I think venture capitalists are naturally careful. So what we're focused on is continuing to build our business and do so responsibly.
NetApp has a solid, long-term storage history on which it built the data fabric and now intelligent data infrastructure. Is it possible for other companies to develop something similar to your intelligent data infrastructure from scratch without having that long-term storage background?
I think it's hard to. The intelligence services layer benefits extraordinarily from being very close to storage. We can build ways for them to work seamlessly together that makes it operationally a lot better for customers, for example, by putting security right in the data path so that as data is written to storage, you can immediately detect if a ransomware attack is happening as opposed to doing it two hops away. So I think many of the intelligence services that we will pursue will benefit from being very close to or co-resident with storage. That doesn't mean to say that you cannot build intelligent services without having a storage pedigree.
OK, but do you think it's going to be more difficult?
There's a class of them that really belong next to storage. And then there's a class of them that could be done separate from storage.