I think with XtremIO and with VxRail – Dell EMC is showing how quickly we can move. In both the AFA segment and the HCI segment, we were late out of the starting blocks and startups thought maybe the giants were asleep, or not sufficiently nimble.
XtremIO has now shipped more than $3B, and Dell EMC is overwhelmingly the AFA leader – with XtremIO joined by all-flash VMAX3 and Unity. Today, people are realizing how challenging it is going to be for the AFA startups.
What about in the Hyper-converged Infrastructure (HCI) market? We’re in an earlier chapter of the same book.
The HCI market has been growing for about 5-6 years quietly. In the last 2 years has become a critical part of the Enterprise IT market with the strengthening and maturing of SDS models, and accelerated by the plummeting costs of NAND and 10GbE connectivity.
Hyper-convergence generally manifests in 3 models:
- Software only (completely “build it yourself”)
- Software + hardware bundles (de-risked “build it yourself” approach like ScaleIO-ready nodes, or VSAN-ready nodes)
- Turnkey HCI with full management/orchestration and lifecycle, like Dell EMC VxRail, VxRack and Dell EMC XC.
We entered the HCI appliance market in force in February of 2016 with VxRail (interesting to go back in time and read the launch post here). In May, we launched our first HCI Rack scale systems (VxRack).
Q: How is it going?
A: Our HCI business is on a FACEMELTING TEAR.
Today, I’m going to focus on VxRail, because it touches more customers by count – but likewise, while the customer count is lower, we have VxRack customers now that have more than 500 nodes deployed – truly “Rack Scale”.
We launched VxRail in February (version 3.0) in February, then did a massive update in June (version 3.5 – codenamed “Ghent”) here, and today we’re doing the biggest update to date – VxRail version 4.0 (codenamed “Nicias”).
In that short timeframe, the customer and market response has been nothing short of AMAZING. In August I noted that at the end of Q2, we had shipped more than 1700 nodes. Today, at the launch of VxRail 4.0, we have now shipped:
- 3800+ nodes. BTW – people have asked why I use “node count” as a metric vs “appliances” or customers, and that’s simple… to date – an appliance has 4 nodes, but we count nodes vs. appliances – because that is no longer true, you can start smaller, and you can increment a node at a time, and some appliances are single nodes. Likewise, the customer:node count ratio is constantly changing.
- 60,000 CPU cores.
- 700+ TB of RAM.
- 25+ PB of storage, and the trend towards all-flash is apparent.
- Customers in 90+ countries
- We have many, many customers with $1M+ invested in VxRail.
Pause for a second, and do some math. The VxRail business is growing at ~123% quarterly. Holy @#$%!
What we’re actively proving is that for customers who have standardized on vSphere, they want an HCI that simply put simply is the “appliance manifestation of their standard” – and that is VxRail and VxRack SDDC. They want their standard in turnkey form, they want it supported in a simple way.
VxRail (and it’s rack-scale sibling that incorporates the SDN and higher parts of the stack – VxRack SDDC) are designed by one team, with VMware and Dell EMC people led by a single product management team. I’m a big believer that you want to have simple, focused teams, with no place to hide if their offer is not a hit. A direct feedback loop, with quick iterations is worth more than a perfect initial idea (which is an illusion anyway :-)
Their mission is simple – win with the industries best unabashed vSphere-oriented HCI – enhanced with Dell EMC capabilities around the integrated hardware/software systems level design, support model, and data protection capabilities. That singular team is clear: be the best choice for whom VMware is their standard.
Sidebar: While VMware is the leader in private cloud and on-premises SDDCs, the market as a whole needs CHOICE. If you are NOT standardized on vSphere, particularly if you don’t like VMware, VxRail and VxRack SDDC are NOT for you. For those customers we have the industry leading Dell EMC XC HCIA platforms, and ScaleIO-ready nodes and other VxRack HCI Rack-Scale systems. To be clear, to be transparent - It is my intent as the leader of the combined business to have another team that works intensely with Microsoft, with the same intensity, the same focus – obviously with an internal wall that will isolate them from the VMware team. Furthermore – we are doubling down our validated systems, reference architectures and bundles with the OpenStack and players in the container ecosystem. Dell Technologies must be “better together” but must also give customers choice.
Today, we’re firing off the 4th booster for VxRail – release 4.0. Like with the Apollo mission Saturn rocket design – each stage increased velocity – and enabled the astronauts to reach new hights. The 3rd and 4th stages (command module) took Apollo astronauts to the moon and back.
Today, Dell EMC ships more HC revenue than ANYONE. Just measuring VxRail and Dell EMC XC puts us close to #1. If you include VSAN-ready nodes – we drive more hyper-converged revenue than any other part of the industry (and that’s before we get to the VxRack SDDC booster phases, and launch updates of our Microsoft-aligned offers). If you include VSAN software-only it’s not even close.
BTW – in my internal measurements of marketshare, I don’t include VSAN or ScaleIO software only, not because they aren’t great (they are), but because they are SDS software, not hyper-converged infrastructure, which is some combination of software and hardware. FYI Garnter doesn’t include VSAN-ready nodes in their taxonomy, but IDC does.
That quick market leadership in HCI is all BEFORE today, BEFORE we fire off the next booster.
Perhaps that a good spot to start – what isn’t changing? What is the fundamental design center of VxRail? Answer: Most efficient, highest flexibility, tightest integration of all the HCI offers for customers who have standardized on vSphere.
So if that’s what’s not changing, what’s new? Well, in the same way that with the Saturn rocket each stage increased velocity, I expect VxRail 4.0 will take VxRail alone to the #1 HCIA by revenue. VxRail 4.0 is the biggest release ever, massively increasing the reach of the platform major new hardware and software updates.
VxRail 4.0 also is a 4000W Xenon spotlight for those paying attention to the power of Dell and EMC coming together, and the central role of the Converged Platform and Solutions business.
With the introduction of new configurations powered by Dell PowerEdge (#1 server in the marketplace as a whole!) – the breadth of use cases for VxRail just exploded. There are literally 250x more configurations than yesterday.
The original “G-series” architecture (2U4N) is joined by E-series (entry 1U1N), V-series (VDI focused 2U1N), P-series (Performance optimized 2U1N), and S-Series (storage dense 2U1N).
Each of these new series also supports configure to order, which is HUGE. Customers can tune their CPU (latest generation Intel Broadwell), RAM, Storage, and GPUs – but maintain the simplicity of appliance ordering, support, and lifecycle sustainability.
This captures an important strategic point – one that I didn’t fully internalize until we were 3 months into the VxRail business mid-summer.
While HCI (both appliance and rack-scale system) functionality/personality is all about the software, the completeness, the economics, and frankly the competitiveness of the system-level offer is highly dependent on the industry-standard hardware.
Personally, I think that anyone that pins their HCI aspirations on “hardware secret sauce” is off target. Yes, you can (and should) innovate in the hardware, but if you “pin” your software to that, it may be acceptable (still not fundamentally right) in CI, it’s absolutely not the right strategy in HCI.
But… it’s also the reason something I believe is fundamentally true (but isn’t immediately obvious): in the long game, to win in HCI, beyond having great software, you need to have an incredible x86 server supply chain for your offer to be complete. It’s why (mark my words) – the inevitable HCI startup armageddon will have few players standing, and most dead or gobbled up.
It’s a non-trivial thing to be able to do configure to order. It’s a non-trivial thing to have factories around the globe to cut down on time and inventory. It’s a non-trivial thing to be able to support a customer when a part fails on an appliance in Timbuktu, on a oil derrick or in a remote factory. You can get away without those things when you’re at 100 customers, not when you are at 1000+. No one does this better than Dell EMC.
Of particular interest is the new E-series (using the Dell EMC PowerEdge R630) which lowers the entry price point from $60K list to $45K list. When we looked at the lessons from failed past efforts in years gone by, a bit part of nailing the HCI market was an acknowledgement and embrace of the fact that there is a high Price Elasticity of Demand (PED – look it up). The software update of VxRail 4.0 also supports 3 node configurations, which also lowers the point of entry. As we do the next update with VSAN 6.5, customers can expect us to take this minimum down to 2 node configurations using cross-connect and eliminating the need for a switch (and thereby supporting sub $30K variations).
The E-series opens up new markets, new use cases – which is good for customers. From a competitive standpoint, with VxRail 3.0 and 3.5, we guided people away from the smallest use cases (where we would be scaled and priced out of the market) – VxRail 4.0 and E-series appliances will make life challenging for the HCI startups who focused on the lower-part of the market, and then tried to use that foothold to scale up.
I also know of many customers who have been waiting for the P-Series (Performace) and the V-Series (VDI) which use the PowerEdge R730 platform. The P-Series can have up to 44 CPU cores, and 1.5TB of RAM in a node, which is a truckload. The V-Series fills a critical gap in End-User-Computing use cases, which is GPU support. There’s support for single or dual GPUs from NVIDIA (Telsa M60) or AMD (FirePro)
And for workloads whose storage capacity scales faster than CPU or Memory (think of running Cloudera or Hortonworks using the vSphere Big Data Extensions) the S-Series appliances are designed for DENSE storage (and they use the PowerEdge R730xd platform).
With this broad, configurable family of VxRail appliances – the rules of what you can vary and what you can’t has to thread the needle of “Balance” and “Flexibility”. The original rule (all nodes need to be all-flash or hybrid, no mixing of the two types) has broadened out. I’m very happy with the results – I think they thread the needle:
There’s also big updates to the VxRail Management software layer. The first part is to continue down the path where we teased apart vCenter and VxRail cluster management (not day to day operation – which is all through vCenter). Some customers love the ease of automatically setting up vCenter (which we still can do), but you can imagine that if you have 300 remote sites, you don’t want 300 vCenter instances :-)
The second part is our relentless march to complete user self-service and “ease of” which takes a huge step forward in VxRail 4.0. Customers are able to completely navigate the 3.5 to 4.0 update by themselves.
The small “asterix” at bottom is for customers using vSphere standard edition – where we will hold their hand a bit (the lack of a distributed virtual switch is the basis of this). We’re still holding customers hands on initial installs to make sure the learning is getting right back to the product team. There are still a couple network pre-reqs we find sometimes customers stumble over – but getting VxRail up and running is quick and easy. I expect (and am pushing the product team) to eliminate ANY services requirement with VxRail.
There’s one important update which isn’t about hardware, or software. VxRail is the first product which doesn’t just “use the combined portfolio”, but actually uses the combined operational structure of the merged Dell EMC.
VxRail software is loaded in the combined supply chain. Configure to order is possible because of this. The ability to do field mech replacement on parts (vs. appliances and whole nodes) is possible because of this. That operational stuff MATTERS to customers.
Anyone who has been through a large-scale merger knows the inherent challenges of different processes, different IT systems, different supply chains and support processes. The new PowerEdge nodes are quotable by Dell and by EMC (even before we integrate the salesforce) – which means we’ve made big strides on integrating our operational systems. It is a super-human feat that we’re this integrated so quickly.
BTW – I cannot thank the teams working on this (“Project Augusta”) enough. It has NOT been easy, and don’t hold it against VxRail for being the “pipe-cleaner” (aka the first thing to go through this degree of operational integration)… but it’s hugely important for our customers.
Customers and partners – this operational aspect, means that the G-Series appliances are available globally right away, but the E-Series, P-series, V-Series, S-Series will have a phased rollout, with the bulk of the world covered in Q4, and some RoW locations will come in 2017. All the VxRail appliances will be quotable by Nov 12th. The team is working overtime (again, THANK YOU) to quickly cover the globe.
One other note for partners – to be able to provide VxRail to your customers – you need to be an EMC partner. The Dell and EMC partner programs are expected to become integrated in early 2017 – but until then, you need to be an EMC partner.
To the VxRail team of Dell EMC and VMware employees – THANK YOU. To our customers and partners – THANK YOU. To our competitors – WATCH OUT, and DON’T GET COMPLACENT :-)
Dell Technologies is still just a baby, it has been less than 2 months since the merger completed – but this VxRail release shows the beginning of what we will do together. It also highlights just how fast we’re moving, how hard we are pushing. I know that to many of the employees, our heads are spinning – but the faster we move, the faster we win.
Likewise, as a product VxRail is a toddler – only an 8-month old. But it’s growing fast, and is the smartest, most athletic 8-month old I’ve ever seen :-) And, we have the next wave of innovation in VxRail and VxRack SDDC ready in another couple of quarters. That said – we’re an 8th month old which is already kicking butt :-)