Adaptability is a must in business, because when one company isn’t ready to capitalise on an opportunity, another will.
This is why Nutanix is adjusting some of its internal strategies in light of recent events, such as Broadcom’s acquisition of VMware. For Nutanix CEO Rajiv Ramaswami, time is of the essence.
“A lot of customers didn’t know what would happen after the acquisition closed last November. Between November and May, they’ve seen all the changes that have been made, and now they’re realising the potential impact — whether it’s changes in pricing, the roadmap, innovation, or support. This is affecting customers and the partner community,” he said during a media briefing on the sidelines of the Nutanix .NEXT 2024 conference in Barcelona.
New capabilities
Given what has happened, Ramaswami believes that VMware customers still have time to rethink their long-term strategy.
“Many customers signed multi-year agreements with VMware before the acquisition closed, so they have three-year or five-year deals. Hence, they have time, and they also have other projects they are working on besides the migration project with their IT teams. They view this as a long-term issue, feeling they must address it to reduce their long-term risk. However, if I’m getting a renewal three years from now, there’s also hope that maybe things will be okay,” he explained.
For customers migrating from VMware to Nutanix, hardware refresh is often one of the requirements, Ramaswami observed. Therefore, the company is currently working on making the transition easier for enterprises.
“If somebody bought a storage array or a bunch of servers, they follow a three-to-five-year depreciation cycle. Typically, when we do a migration, it happens when they’re about to refresh their hardware, so that cycle also has to align with the migration. At the moment, we can run on your existing hardware to some extent. We can run on VSAN-ready nodes, and over time, we will start supporting external storage areas with our hypervisor,” the Chief Executive shared.
Presently, Nutanix’s AHV (Acropolis Hypervisor) solution is a full-fledged hypervisor, which will soon feature external storage support, Ramaswami revealed.
“It wasn’t a priority for us in the past because people were not going to replace a VMware hypervisor with any other solution. Now they want to do it, so that situation has changed, and we are addressing it,” he said.
Kubernetes push
In January this year, Nutanix acquired the D2iQ Kubernetes Platform (DKP), a comprehensive containerisation management solution. According to Ramaswami, DKP brings two key advantages to Nutanix.
The first advantage is its mature management operations platform, which Nutanix didn’t have.
Secondly, D2iQ established credibility in the open-source community and was one of the founders of the Cloud Native Computing Foundation.
“That’s very important because if you want to be in that space, you have to give back to the community,” Ramaswami remarked.
Following the acquisition, Nutanix combined its in-house Kubernetes team with D2iQ’s 40-plus engineers. Additionally, a specialist sales force will be built, focusing on Kubernetes.
“It’s a different language. You’re talking to platform engineers, not infrastructure people. That’s what the team at D2iQ has been doing so far. Over time, our base sellers will have to learn the language and figure out how to sell it. We don’t start there, because it takes time to educate and bring everyone up to speed. We kick-started this by having a specialist sales force comprising sales and after-sales executives, sales reps, and technical sales engineers to back them up,” Ramaswami noted.
AI horizon
In terms of AI, Ramaswami identified three vectors where Nutanix is leveraging the technology.
The first vector is focused on running customer applications. The second is internal uses of GPT for efficiency, productivity, and automation.
“One of the first use cases for us was in our support organisation. We now have an internal GPT in a box with an LLM trained on all our internal design documents and knowledge base articles. When a customer service request comes in, our support engineer queries the AI search engine, which tries to identify the root cause, diagnose the problem, and provide a response,” the CEO shared.
The third vector is aimed at product enhancements.
“We have an internal tool called Insight, which collects telemetry data. We call this telemetry data ‘pulse data’ from customers who sign up for it. In fact, over 70% of our customers who don’t have dark sites allow us to collect their telemetry data, which we anonymise. We then analyse this data and turn it into actionable insights for our customers. Generative AI can play a significant role here as well,” he said.
Asian growth
Zooming in on Asia, Ramaswami admitted that the region is still an emerging market for the company compared to Europe and the Americas. However, Nutanix is seeing significant growth in India.
“We’re underpenetrated in the Asian market overall, but we are doing very well in India because the country’s GDP is growing at 7%, and we are growing substantially faster than that. We have a majority market share in India as well,” he said.
Moreover, Nutanix considers Japan and Singapore as important markets in the region.
“The overall contribution of Asia is relatively small, partly because of our history. We’re still a growing company. We started as a start-up in Silicon Valley. You focus on America first, then add EMEA, and then Asia. That’s where we are. The Asian team is growing nicely, and we have a lot of new talent. We have great expectations for growth in our Asian markets,” the Chief Executive concluded.
