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Nutanix is in a state of transition and hopes that new partnerships with the likes of AWS, Azure, Red Hat and Citrix will help it reach its goal of a unversal platform that runs traditional or modern applications.
No vendor provides a clearer window into hyperconverged infrastructure (HCI) than Nutanix.
Nutanix did as much to create and grow the HCI market as any company, and it remains among a small group of HCI leaders. Of the big three HCI vendors (Nutanix, VMware and Dell), only Nutanix started out in the HCI business and HCI remains its core business. That makes the annual Nutanix .NEXT conference worth paying close attention to for HCI watchers.
That was especially the case with virtual .NEXT 2021, which took place last week, nine months after Rajiv Ramaswami replaced founding CEO Dheeraj Pandey and 10 years after Nutanix came out of stealth. Nutanix is in a transition, and so is HCI. But while HCI originally changed IT processes by collapsing storage, compute and networking into one tier managed through hypervisors, Nutanix’s current transition looks a lot like what the rest of the storage world is going through. It encompasses hybrid cloud, multicloud, containers/Kubernetes and services.
The goal is to provide one platform that can be deployed across any cloud and on-premises and that can run any traditional or modern application. Considering HCI was originally shipped on a box and developed around virtual machines before the dawn of containers, any HCI vendor faces challenges in doing what Nutanix is trying to pull off.
Nutanix executives have been talking about hybrid cloud for years now, but the pieces to that strategy are still coming into place. A big change involves evolving beyond its IT infrastructure partnerships (with Super Micro, Lenovo, HPE and formerly VMware and Dell) to other areas. It also must streamline its 20-plus products into buckets that reflect its current direction.
Despite a fire hose of incremental upgrades to its Acropolis Operating System (AOS) and other products at .NEXT 2021, Nutanix mainly focused on its new partnerships.
Nutanix Clusters is a big piece of its strategy for enabling customers to run applications in the data center and in public clouds. Clusters provides a Nutanix platform in the public cloud that enables companies to move applications and data from an on-premises Nutanix infrastructure to the cloud as they would move virtual machines to a remote HCI. The main use cases are disaster recovery, on-demand elasticity and the ability to migrate and modernize applications. Customers can migrate their applications to the cloud now, and then modernize them piece by piece at their own pace.
But while VMware enables workloads to run on the three major public clouds, Nutanix Clusters is only generally available on AWS now. Nutanix said at .NEXT that Clusters on Azure is in private preview, but gave no indication of when it might expand to other clouds.
Nutanix expanded the AWS regions and instances for Clusters on AWS and added support for AWS GovCloud. Nutanix also added an Elastic DR feature on AWS, which allows customers to start with a small DR cluster in AWS and expand dynamically to host workload failover over during a disaster.
Nutanix Clusters on Azure is available in two U.S. regions in preview. At general availability, Nutanix Clusters will be available on the Azure Marketplace and in more U.S. and international regions. Nutanix is also now supporting Azure Arc, which enables companies to run Azure services on-prem and in other public clouds. Nutanix Clusters on Azure customers can use Arc for Kubernetes to manage containers running on Nutanix Karbon.
Red Hat OpenShift plays an important role in Nutanix’s Kubernetes strategy — one that may have ramifications for the HCI vendor’s Karbon Kubernetes distribution.
Red Hat OpenShift is the preferred choice for enterprise full-stack Kubernetes on Nutanix HCI, and Nutanix is the preferred choice for Red Hat Enterprise Linux (RHEL) and OpenShift Container Platform. Red Hat is certified for the AHV hypervisor and Nutanix Cloud Platform, and AHV is certified by Red Hat for RHEL and OpenShift. The deal means joint customers can run Red Hat OpenShift and Linux directly on Nutanix AHV hypervisor. The vendors are working on greater integration that will allow customers to deploy Nutanix products on OpenShift through the Nutanix Marketplace.
The Nutanix-Red Hat deal is seen as competitive to VMware’s Tanzu Kubernetes strategy, which is competitive to Nutanix HCI and Red Hat containers. Nutanix is carefully positioning Open Shift and Karbon to avoid competition there. Nutanix representatives describe Karbon as an easy way to deploy “vanilla” Kubernetes, with Open Shift a more robust, mature option.
Nutanix added virtual desktop vendor Citrix to its as-a-service partner list at .NEXT. Nutanix is a Citrix preferred choice for HCI hybrid and multicloud deployments through its support for Citrix Virtual Apps and Desktop services, and Citrix is a preferred Nutanix partner for enterprise end-user computing. The two are also working on a desktop-as-a-service offering.
Nutanix already works with platform partners HPE and Lenovo on services offerings. HPE sells Nutanix core HCI software and its Era database management product on ProLiant servers through its GreenLake cloud services program, and Nutanix also sells its software on ProLiant servers. That is despite HPE’s competing SimpliVity HCI product.
Lenovo earlier this year launched the TruScale for Hosted Desktops service based on Nutanix software on ThinkAgile HX servers.
At .NEXT 2021, Nutanix added Data Lens, a cloud service that provides analytics for unstructured data stored on Nutanix Unified Storage.
In some ways, Nutanix has been ahead of the industry curve in switching from a hardware to software business model and to subscription pricing. But despite completing those transformations and landing more than 20,000 HCI customers and generating $1.45 billion in revenue last year, it continues to lose money. Nutanix lost $1 billion in its last fiscal year, bringing its lifetime losses to $3.6 billion.
Ramaswami forecasts the rate of subscription renewals will make Nutanix cash-flow positive by the first half of 2023 and profitable within a year of that. But that will largely depend on how well it navigates the IT transitions to cloud, containers and services.