Fifty percent of enterprise data centers are leaving the big storage companies, according to Micron VP, Darren Thomas, and chip vendors like Micron can’t simply rely on these OEMs any more to sustain and grow their businesses. This was a theme repeated several times during the company’s analyst event in San Jose last week.
Even if you don’t agree with that statistic, more companies are seeking out lower-cost ‘commodity-based’ solutions, many being sold by new and smaller vendors. Micron made it clear they don’t want to “leave anything to chance” regarding the company’s future so they’re making some significant investments in technology, business development and partnerships with the vendors that are capturing some of that data center business from the traditional storage players. Some of these companies are in the software-defined space, such as Nexenta and PernixData. And, ironically, one of those partners is IBM with their FlashSystem all-flash array.
They also mentioned a strategic partnership with Seagate, replacing Samsung who, according to Micron, wasn’t offering the production guarantees Seagate needed and Micron was happy to provide. This is more than a supplier relationship, but a technology partnership as well, with both companies slated to sell some new Seagate disk drives. In fact, Seagate has made some similar investments to help build out their ‘stack’, getting into the systems business with their acquisition of Xiotech, as an example, to better meet the demands of their hyper-scale customers, but also to drive overall storage innovation.
A New Way to Innovate
Micron, like hard drive manufacturers, knows that big opportunities to innovate come outside of the box, the SSD ‘box’ in this case. In the HDD business there’s more innovation possible when you take the entire storage array into consideration, not just the disk drive itself. This was the theme of a write-up we did last year “Why HGST is Now Building Storage Systems”. And it’s even more true in the SSD business.
Flash offers dramatically better performance, but traditional storage controllers can’t take full advantage of it. Early on, disk array vendors simply dropped SAS SSDs into their existing arrays and got immediate improvement. In the past several years, storage systems have evolved and become better able to leverage what flash can bring. But there’s still quite a gap between the technical capabilities of NAND flash and the specs being offered by flash-based storage systems. And this gap can only be fixed by getting knee-deep in systems technology, controller technology and in the rest of the storage ecosystem.
Micron’s plan is to leverage their deep knowledge of solid-state storage to close this gap (after all, they own the entire process down to the silicon). In fact they’re stepping up their software development efforts as well with a new facility in Austin, TX, as an example. Then, they’ll use the resulting solutions to create new partnerships that can complement these advances – not simply go out and acquire new companies. They didn’t say exactly how they could make partnering work when others in this space are buying up new companies, but it could include the leverage they have as an integrated chip supplier.
In a similar vein, Micron has been developing a new kind of processor, a co-processor of sorts, called Automata. It’s a highly-parallel architecture designed to process large volumes of unstructured data, like those typically found in Big Data applications. This design excels at pattern matching and the kinds of comparison-heavy work done in these environments. Micron has been developing this technology for the past eight years and plans to release products this year. Here’s a write up on StorageSwiss.com.
Micron is a component manufacturer that is trying to break out of OEM-based ‘parts business’ and is making the investments they deem necessary to understand the systems-level storage business. They’re also working to flesh out their organization with customer facing resources (sales, channel) and a new focus on partnering. They’re not looking to ‘vertically integrate’ and simply capture more margin, but instead, to really understand the entire ecosystem that their technology supports.
To this end, Micron is using their leverage as a memory supplier that makes its own silicon to get in and develop relationships with companies at multiple levels in the storage industry. And they’re taking these relationships beyond supply to develop technology partnerships that will keep them closer to the end-user/customer and maintain control of their future as the flash-based storage industry continues to evolve.
But they’re still a technology company, one that’s not afraid to make some serious investments, as evidenced by their Automata project and their commitment to 3D NAND, which we’ll discuss in the next column. Interestingly, their investments in the storage ecosystem should actually lead to more flash innovation as well.