Analyst Blog: Making a NetApp/SolidFire Deal Work

The rumors around a potential NetApp/Solidfire deal seem to be heating up. My research leads me to believe there are some conversations between the two companies. CRN suggests that NetApp is interested in acquiring SolidFire for over a billion dollars. If this deal were to come to fruition, could NetApp make it work? There are a lot of negatives, after all NetApp does not have a fantastic track record when it comes to buying companies.

NetApp is in an awkward place in the market. The unstructured data market is moving to scale-out NAS like Qumulo and Intermodal Data or object storage software solutions running on commodity hardware like Cloudian, Cleversafe, and others. Application and VM storage infrastructures are moving to solutions from legacy vendors like HPE’s 3PAR or EMC’s XtremIO or startups like NexGen, Nimble, Pure Storage, Tegile, and TinTri. The NetApp FAS family is stuck somewhere in the middle; too expensive for massive unstructured data, overkill for home directories and performance inefficiency. The FAS family can do the job but is it, by today’s standards, the best way to get there?

Apparently NetApp may not think so, hence the explanation behind the SolidFire rumors. If true, NetApp should go through with the purchase. SolidFire is one of the better differentiated all-flash arrays with features like scale-out and quality of service. It also can send snapshot data to object storage that could breathe new life into NetApp’s StorageGrid solution.

Making it work

The hard part is making a NetApp/Solidfire deal work. NetApp would have to divest itself, finally, of its “everything serves at the pleasure of On-Tap” mentality. That attitude is responsible for NetApp’s poor acquisition track record.

NetApp should swallow hard, move the SolidFire software to its E-Series hardware, then stop selling the FAS hardware family. The new SolidFire/E-Series solution should become its primary storage solution and the centerpiece of the portfolio. The FAS software solution, known as Data OnTap Edge, should be re-tooled to focus just on active data file sharing. The new SolidFire solution should also integrate with StorageGrid, which can become a backup repository as well as NetApp’s primary storage solution for non-active unstructured data complementing the re-tooled Edge solution. Finally, NetApp should end its policy of overcharging for out of warranty maintenance. The SolidFire and StorageGrid solutions are designed for 10-plus years of service the maintenance contracts should match that reality.

With the possible exception of AltaVault, NetApp should remove the rest of the product offering from the portfolio. Removing a product from a portfolio does not mean that NetApp has to call customers and tell them to unplug their gear. It means that it will focus on a significantly streamlined portfolio for new projects. Support for the non-portfolio solutions will continue as long as NetApp deems necessary. Current customers should have no pressure to upgrade or migrate.

StorageSwiss Take

Will NetApp take this aggressive of a move post acquisition? Probably not, but if it did, the result would be a lean, mean NetApp. Its salespeople would have the advantage of focus and knowing what they should do each morning when they wake up. Its field engineers could become experts and know this simplified offering inside and out. NetApp and SolidFire should be able to make this transition faster than the Dell-EMC transition, which would position the new NetApp for early success after the acquisition while Dell-EMC is still fumbling through its own product consolidation as we discuss in our entry “Dell Buys EMC – Can 2+2=6?”.

Twelve years ago George Crump founded Storage Switzerland with one simple goal; to educate IT professionals about all aspects of data center storage. He is the primary contributor to Storage Switzerland and is a heavily sought after public speaker. With over 25 years of experience designing storage solutions for data centers across the US, he has seen the birth of such technologies as RAID, NAS and SAN, Virtualization, Cloud and Enterprise Flash. Prior to founding Storage Switzerland he was CTO at one of the nation's largest storage integrators where he was in charge of technology testing, integration and product selection.

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2 comments on “Analyst Blog: Making a NetApp/SolidFire Deal Work
  1. Tim Wessels says:

    Well, hard to disagree with Mr. Crump on this one. NetApp has had 12 months of quarterly declines. It has a history of not doing well with acquisitions, but the flash array and object-based storage software providers are eating their lunch. So they either do something radical and buy SolidFire or continue their glide into oblivion. The future is all about storage simplification, and if NetApp wants a future they need to pay attention. To their credit, NetApp did realize the importance of using APIs to expose everything they do.

  2. -t says:

    Great read, I’ve implemented FAS for the last 5 years, and Clustered ONTAP is a huge challenge to implement properly. No future development of 7-Mode was the final push to all CDOT and that has made FAS wildly complex in comparison to others. NetApp has some of the best features on the planet, most of which are moving further up the stack now though. It will be interesting to see how this turns out in the end. NetApp is no longer as easy to setup as a toaster.

    I would only add that X-IO storage – Xiotech is a mature simple scale out solution who provides HDD, Hybrid, or All Flash that is faster and more cost effective than most startups mentioned here. The deserve to be better known.

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