Analysis Dell is increasing the performance of its hyperconverged product lines by adding 14G PowerEdge servers amid triple-digit VxRail revenue growth. Is this just a short-term spurt or something deeper?
Dell's VxRail and XC Series appliances will use the latest Xeon Scalable Processor CPUs. The XC Series is also being given new NVMe SSD configurations.
Skylaked VxRail systems can handle twice the IOPS compared to 13G line, have faster response times, and a ninefold increase in response time predictability; all with the same price economics.
They also get file support with Isilon SD Edge for remote office or edge-to-core file deployments, and can have three Nvidia GPUs instead of just one. All this expands the use case envelope in Dell's view.
The XCs get up to 50 per cent more cores per appliance with Skylake, and 50 per cent more GPU power. Data protection software has been added, again expanding the use case coverage area.
Somewhat to our amazement, Dell has more than a million individual HCI configurations, millions in fact, taking all the nit-picking options into account.
HCI market growth
The hyperconverged infrastructure (HCI) area is the fastest-growing section of the overall converged infrastructure (CI) market, with IDC recording 48.5 per cent annual growth to $763.4m in revenue in the second quarter. HCI is now a quarter of the overall CI market and predicted to be worth more than $7.6bn by 2021.
Dell boasts it leads the HCI market, quoting IDC figures giving it a 29 per cent share in the second quarter with a 149 per cent annual growth rate.
Chad Sakac, president of Dell EMC's Converged Platforms and Solutions Division, described VxRail's 275 per cent annual growth in the second quarter as "awesome". Dell HCI revenues – meaning VxRail, XC and VSAN Ready Nodes – are closing in on $1bn this year, the company estimated.
There are around 11,000 VSAN customers, one third of whom run VxRail, meaning thousands more customers wait in the wings. That also means two thirds of customers want build-it-yourself HCI compared to turnkey, hit-the-button HCI.
Sakac reckons a successful supplier needs both kinds of product – killer software and a killer turnkey product.
HCI market development
HCI is becoming a standardised building block for on-premises infrastructure. In our view that means Sakac's division could become a billion-dollar revenue earner.
He believes we are still in the very early days of HCI growth and it's not necessarily a zero-sum game, with HCI replacing existing kit and not growing the market. "It's possible many players will grow."
He thinks HCI supplier consolidation is definitely under way. Witness Cisco buying Springpath and HPE acquiring SimpliVity.
Will we see new players? We might conceivably see a Google Kubernetes appliance. RedHat might do something, certainly having the software and a hardware ecosystem for a build-it-yourself HCI product.
HCI, Sakac thinks, is heading more and more towards mission-critical enterprise use. We'll see it being used in IoT, simplifying edge IT system environments perhaps, and we'll see object storage capabilities being added to HCI functionality.
Upgrading its HCI products to Skylake processors is table stakes for Dell and every other x86-based HCI vendor. The extra performance means more workloads can be supported and, if suppliers don't upgrade, their products will look underpowered.
VxRail appliances with 14G servers are orderable with availability from December 12, and the 14G-using XC640, XC740xd and XC740 are available now. ®