VC cash, growing market propels SimpliVity into hyperconverged orbit

Server SAN market worth $1,061m in 2014

Comment SimpliVity's hyperconverged system sales grew almost 250 per cent in the first half of 2015 – pretty impressive for sure, but how’s it doing compared with everyone else in this hot storage sector?

Wikibon's Server SAN 2012-2026 research report includes hyperconverged system vendors, and below we picked out a chart showing Enterprise Server SAN vendor participation in 2013 and 2014:

Top_70_Percent_Ent_Server_SAN_vendors

We added the arrows, by the way

The System Drag component of the revenues are the storage hardware, server hardware to drive the storage, and other software required to implement software-only Server SAN products, such as VMware’s VSAN.

The report states “Wikibon has included System Drag in order to normalise software-only Server SAN vendors such as VMware from mainly appliance vendors such as Nutanix.”

Percentage numbers are fine, but percentages of what? The Wikibon-estimated enterprise Server SAN market was worth $370m in 2013 and $1,061m in 2014, a 187 per cent increase. Over the 2013-2014 period the chart shows how the vendor shares changed.

If a vendor’s share went up then it outgrew the market. If it went down then it grew, if it grew at all, less than the market.

However, this chart has the system drag element included and doesn’t show absolute revenues per vendor. There isn’t a chart for 2013 but there is a chart for 2014:

Enterprise_Server_SAN_Vendor_2014_less_system_drag

System drag component has been separated out. Individual column values removed; you see them in Wikibon’s report.

Nutanix and HP lead by a mile with SimpliVity in third place. SimpliVity said it’s been growing gangbusters in the first half of 2015.

There are now more than 2,000 SimpliVity systems deployed, “with about 550 large and mid-sized enterprises counted as customers, nearly 380 per cent year-on-year growth.”

There are four times the number of deals for SimpliVity SW with Cisco UCS servers in the second quarter of this year when compared with the first.

It's this growth pattern that persuaded VCs to put $175m into SimpliVity in the March funding round.

Nutanix said it had 1,200 customers in February this year with a $300m/year run rate. Its average system price must be higher than SimpliVity’s.

The December 2014 IDC Hyperconverged Systems Marketscape supports this notion:

IDC_Marketscape_2014 hyperconverged_suppliers

The IDC report focusses exclusively on hyperconverged systems and doesn’t include server SANs, such as HP’s VSA, hence HP doesn’t appear in its marketscape.

Its ranking of VMware vis-a-vis Scale Computing is quite different from Wikibon, which has Scale in sixth place compared with VMware’s fourth position.

If, according to Wikibon, third-placed player SimpliVity grew 250 per cent in the first half of this year we can imagine first-placed Nutanix did the same or better. Did HP grow as fast, following its less-than-the-market growth from 2013 to 2014?

We would imagine that VMware grew much faster than HP and is probably in second place in this enterprise server SAN market right now, with SimpliVity in fourth place behind HP, but set to overtake it if its growth continues at a high rate.

This market is developing so fast that the analyst firms have differing definitions of it and different numbers too; not a surprise.

It looks clear that the early winners are Nutanix, VMware and SimpliVity. HP could claw back lost ground to join them but that company is pre-occupied with splitting into two separate businesses and many well be distracted. EMC will come up fast, most likely, and the supplier rankings after that are anyone's guess. ®

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