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Like most flash array vendors, Tegile Systems Inc. is waiting for advances such as nonvolatile memory express, or NVMe, and 3D XPoint to become market reality. The vendor is banking on its flash design to maximize those technologies, compared to legacy systems originally built for HDDs.
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Unlike established vendors who come from the hard-disk world and newcomers who built all-flash arrays from the start, Tegile started in hybrids. It had flash in all of its arrays from the start in 2012, but added all-flash a few years later. Now, it has two flash platforms: The Tegile IntelliFlash T Series is based on the vendor's own technology, and the Tegile IntelliFlash HD (high density) incorporates chassis from partner SanDisk -- now Western Digital -- for higher-capacity loads.
SearchSolidStateStorage talked to Tegile Systems' CEO, Rohit Kshetrapal, about the latest developments in the flash storage market. We discussed Tegile Systems' NVMe plans, how customers are using flash and the cloud, the Hewlett Packard Enterprise (HPE) acquisition of Nimble Storage and why an initial public offering (IPO) is not in the near-term future.
What is the mix among your customers between all-flash and hybrid arrays?
Kshetrapal: I would say in excess of 60% of our business has become all-flash. As we see the economics changing and larger-sized flash drives coming in, we hear less discussion around hybrids. The exception is when people may want a disaster recovery box.
The migration from hard drives into flash is continuing whenever customers come up for refresh. And it's definitely a highly competitive market. Many customers don't really need flash, workload-wise, but they still buy flash because they're future-proofing their storage.
Speaking of competition, how will the HPE-Nimble Storage acquisition affect the flash and hybrid array markets?
Kshetrapal: Almost every acquisition generates a period of confusion, and HPE's acquisition of Nimble will be no exception. As we saw when Dell acquired EMC, it takes time to effectively articulate new messages, communicate the product roadmap and reconcile pricing models. This will be made even more complex for HPE, given the overlap in hybrid and all-flash product lines that exist between the two companies. HPE will face the challenge of combining two distinctly different user interfaces, technologies and operating experiences, and then communicating the path forward to the market.
This presents an opportunity for storage upstarts with broader platforms to expand their customer base even more. Channel partners and businesses are looking for storage solutions that can grow with them, without any uncertainty. At Tegile, we've already seen a major influx in phone calls, and it's only week one.
What have you done to prepare for NVMe? When do you expect to be able to ship NVMe drives in Tegile Systems' IntelliFlash arrays?
Kshetrapal: The gating factor is we're waiting for the NVMe manufacturers to provide that. The platforms are ready, [and] the PCIe bus is ready.
Our platforms have four slots; you can add an NVMe dual-port drive when [NAND] vendors are ready. Then, you can really go into the architecture and have more and more of it sitting on the faster type of media. To go one step further, if you want a really screaming, massively low-latency box, then you can have a full box with all NVMe SSDs.
So, today, we have NVDIMM to help us with read/writes, and we are ready for NVMe dual-ported drives, so you can use the full force that is sitting there to accelerate even the flash systems. Then, one stop beyond is an all-NVMe box.
Now that almost every vendor has all-flash systems, how do you differentiate?
Kshetrapal: We're seeing incumbents now selling all-flash systems, but their systems are not redesigned from the ground up. Taking their system and putting all-flash in it is great for marketing, but the reality is that [the] system is challenged. It's like putting a BMW engine inside a Prius.
Those become a price battle, and a customer that's not so sophisticated may go with that. Then, you have the next-generation players that are very much a part of this. You'll see the Pures, the Nimbles -- those are the others we see most often.
Are Tegile IntelliFlash customers using the cloud, too?
Kshetrapal: SaaS [software-as-a-service] apps have been there for a while. We are now seeing email migration to the cloud. But when we look at core databases and analytics-based systems with high performance, low latency requirements, those are all on premises. When customers start figuring the cost of performance on the cloud versus the cost of performance in the data center, the data center wins.
Sometimes, the customer might not want a Capex model, but might want an Opex model. For that, we've been offering monthly subscription pricing, called IntelliPay. IntelliPay is enhanced substantially with dedupe and compression. Amazon is not giving you deduplication and compression rates; they're giving you raw rates. So, we can provide customers with that same Capex/Opex model they require from the cloud while providing the performance level.
A year ago, you said you were building toward an IPO, possibly in 2017. Where do you stand on that?
Kshetrapal: I don't think new IPOs in the storage market are a reality today -- at least in the foreseeable future.
Rohit KshetrapalCEO, Tegile
The reason for that is we see our peer groups spending too much money to pay for growth, and they're being punished for it. The market has come to the realization today that you need to balance growth and cost. We've been saying that for a long time. A big question is, 'Can we grow faster?' But then, [the] question becomes, 'What price are you growing at?' We've always been very prudent about that.
Until you have those equations working properly for you, an IPO is actually detrimental. So, it depends on market conditions, and you have to show a path to profitability much sooner than the others are.
When we see Pure and Nutanix continue to spend money the way they are, we don't think those models are sustainable at the break-even points they're talking about today.
So, you're looking for profitability more than showing growth?
Kshetrapal: That's the model the street is asking for and has been for the last six to nine months. The market is looking for the players who will build a sustainable market. That is the most important thing.
Will you seek more venture funding this year?
Kshetrapal: Yes. We'll continue to add funding as needed, and our business momentum is good, despite the tight market.
Both our existing strategic partners, such as Western Digital, and other investors are supportive of the company. We will look at other routes to market. We feel existing routes to market by channel are expensive, so we will do OEM deals in the near future where we're able to get access to customer bases in a much more economical manner.
Besides new flash technologies, where are you investing in research and development?
Kshetrapal: We've made significant investments in our IntelliCare predictive analytics. Data collection has been phenomenal for us. We've gone from a daily collection of data to an hourly collection of data. And this year, we will go to a five-minute data collection.
This predictive analytics for us today allows us not only normal break-fix, which everybody's had for centuries, but we can accurately predict when a customer will run out of room. We can also say when their performance workloads are changing, and how they should balance those workloads among media types automatically. We can provide 360-degree view for not only customer support, but also for gradually managing more and more of the arrays for our customers. That has been a strong focus for us.
You'll also continue to see more on NVMe and other media. When 3D XPoint becomes real, we're on the cusp of providing something there. We're waiting for samples from vendors. Then, NVMe over Fabrics is the next path that we're seeing. That extends the NVMe platform. More and more, the instantaneous decision-making based on large amounts of data is becoming a reality.
NVMe over Fabrics adoption picks up the pace
HPE increases SAN portfolio with Nimble purchase
SanDisk powers Tegile IntelliFlash line