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Violin is back from bankruptcy with new ownership, a new CEO and a new name. The resurrected flash array vendor dropped "Memory" from its name, and management hopes the changes will make people forget Violin's problems.
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Violin disclosed Monday the details of its future plans after Quantum Partners purchased the beleaguered all-flash array vendor out of bankruptcy.
Quantum Partners is a Cayman Islands limited partnership that serves as the private investment vehicle for billionaire George Soros's hedge fund, Soros Fund Management. The company name has changed from Violin Memory to Violin Inc., but the Violin flash storage portfolio remains.
Ebrahim Abbasi is the new CEO, moving up from his COO role to replace Kevin DeNuccio, who took over as CEO in 2013. Abbasi said the Violin flash storage strategy will revolve around selling its arrays to enterprises to build on-premises clouds while replicating data to public clouds.
"We just removed 'Memory' from our name to reflect that we are developing all-flash arrays for cloud solutions," Abbasi said. "We kept the Violin name because we are proud of what we've done."
Abbasi is the lone holdover from Violin's executive team. Whether the revived Violin can play a winning tune under his direction remains to be seen. Violin launched one of the first all-flash storage systems and has been awarded more than 100 patents, but never reached profitability. Several bids to find a buyer fizzled before Violin eventually sought Chapter 11 bankruptcy protection in December.
In February, a federal bankruptcy court in Delaware approved the Soros bid following an auction. According to Violin's Feb. 15 securities filing, Soros agreed to provide $8 million debtor-in-possession financing to fund continuing operations and restructuring, and approximately $15 million to pay creditors. Quantum Partners will receive all equity interests in the reorganized Violin, in lieu of cash for outstanding convertible notes it holds of nearly $26 million.
Ebrahim AbbasiCEO, Violin
Abbasi vowed Violin will start making money by 2018.
"I have submitted a plan to Soros [Management Group] that this company will be EBITDA-positive within a year," he said. "Many companies project expenses very accurately, but the revenue doesn't come. I don't operate that way -- I will spend money if the revenue is there. The way to profitability is to live within our means."
Abbasi has his work cut out for him. DeNuccio put Violin up for sale in 2015, hiring a financial adviser to solicit bids from prospective buyers. After Violin received no offers, it restructured to save money through cuts in staff and expenses.
The cuts did little to help. During its final three quarters, Violin lost $25.5 million, $22.2 million and $20.1 million, respectively, despite a prevailing boom market for all-flash arrays. The launch of new high-performance arrays late last year came too late to forestall the inevitable.
Abassi said it is too early to discuss the long-term roadmap for the Violin flash storage platform, but the "sweet spot" will revolve around enterprises that need high performance and ultra-low latency cloud storage that they manage on premises.
The strategy involves narrowing its focus to selling the modular Violin Flash Storage Platform (FSP) 7000 Series to support internal enterprise clouds. The FSP 7700 modular chassis provides stretch clustering and high availability.
Violin will continue to support customers with Violin 6100, 6200 and 6600 all-flash models. Those products eventually will be folded into FSP 7000 in a future refresh, Abbasi said.
The existing FSP 7000 Series array family will be tailored for specified workloads. The FSP 7650 is a performance option rated to deliver 1 million IOPS in less than 2 milliseconds. FSP 7450 is a capacity option with 5-to-1 data deduplication and 88 TB of usable flash for about 50 cents per gigabyte.
An upgrade to the Violin Concerto OS will allow customers to use a virtual instance to replicate data to the public cloud. Abassi said Violin is testing Concerto with Google Cloud Engine and plans to integrate Amazon Web Services and Microsoft Azure.
Eric Burgener, a storage analyst at research firm IDC, claims Violin flash storage was too limited to compete in the rapidly evolving all-flash market. He said it would be a challenge to retain existing customers while cultivating new markets.
"I don't see existing enterprise customers staying with Violin over time," Burgener wrote in an email. "I think a very high percentage of them will move to other all-flash platforms, and the [Soros] decision to focus only on cloud infrastructure is likely to further speed that abandonment."
While more enterprises are spinning up internal clouds, Burgener said Violin needs to add predictive cloud analytics and higher storage density to win its share of those deals.
Customers could get an early look at the new Violin storage soon. Abbasi said Violin will formally relaunch some products and preview future rollouts Wednesday, including features and functionality enhancements to Concerto.
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