My best explanations of How Nutanix works

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#3

Denny,
NetApp not going away, but they did come out with their HCI offering:
https://www.netapp.com/us/products/converged-systems/hyper-c…

DellEMC still does SAN arrays and just introduced PowerMax which is VMax on steroids. But they also do HCI via VxRail and to a separate extent VMware does it via VSan or VSan ready nodes.

HPE still does SAN via their 3Par and Nimble offerings, but also bought SimpliVity for an HCI offering. Prior to SimpliVity, HPE was leveraging their legacy Lefthand Storage VSA product in an HCI solution, but as HPE often does, they just decided to buy a more well-known brand.

Cisco doesn’t do SAN solutions, although they partner in larger converged systems with NetApp (FlexPod) and Cisco/VMware/EMC created a separate company called VCE to produce vBlock. Cisco did buy a smaller HCI company and their solution is called Hyperflex and utilizes their UCS server line.

Nutanix is the only real well-known pure play HCI, although they are expanding their software/cloud offerings beyond HCI.

Lenovo doesn’t make their own HCI solution, but resells Nutanix.

Some larger enterprises simply don’t feel HCI is ready for prime time on certain applications, and so HCI won’t be displacing SAN/NAS completely anytime soon. And while 70% of CIOs have a “cloud first” strategy, it turns out that 50% of their apps seem to be on a path back to private cloud/on-prem, due to security concerns or rising costs of public cloud: https://www.crn.com/businesses-moving-from-public-cloud-due-…

Thus the future, at least in the here and now, seems to be a mixed or hybrid Cloud environment. If people say “Multi-cloud” they just literally mean that it is some combination of 2+ public clouds and possibly with private/on-prem cloud.

Cloud was supposed to make it easy, right???

Virtualization was a big wave.
Public cloud is/was a big wave.
I think one of the next big waves is Multi-cloud management, which is done via CMP or Cloud Management Platforms.

So who came out with CMPs? Many on the list above…ha…shocker.

This ties back to Nutanix because I feel people focus too much on trying to understand what HCI is vs understanding why a particular company should do well, from a stock perspective.

HPE, Cisco, DellEMC-VMware, Lenovo all have large mature businesses in the server, storage, and networking spaces, and in many cases their bread and butter products are becoming commoditized and have been under threat due to the migration to public cloud. So even if they have the best HCI or CMP solutions, I don’t see the upside in their stock.

Nutanix is the pure play on HCI, who also has new plays on CMP and other cloud/SaaS solutions, has a hungry/aggressive sales force with a growing but still comparatively limited portfolio of solutions to sell. They can be more laser-focused as a result.

This is where Pure has some similarities, but they are still more hardware than software, and every company listed above also does all-flash, so they have much tougher competition (imo) from NetApp and EMC and Nimble. Whereas if those vendors compete against Nutanix/HCI they have to kind of either bash HCI and try to sell SAN or they say “we have HCI, too” but they aren’t as polished as selling HCI since they aren’t a pure play.

Nutanix has a ton of momentum built up in HCI alone, that should drive the stock for another year easily. The question then becomes do we see them form another foundation of material revenue from Calm, Beam, Era, Epoch, Frame, and XI…all these new solutions that have in their sales toolkit. My pure guess at this point is that they don’t have success across the board, but find a couple solid new revenue streams from that group to complement HCI.

I always play it Q/ER by Q/ER to see the results, but I have an itchy trigger finger that once they hit or come close to hitting their stated $3b in billings goal I may sell if I see any dip in growth rate. HCI will eventually have a declining growth rate, so it is a matter if their Other Bets start to surge and offset any HCI decline.

For me, the above is the only reasoning that matters in owning NTNX stock.

Dreamer

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#4

Good post Dreamer!

HPE, Cisco, DellEMC-VMware, Lenovo all have large mature businesses in the server, storage, and networking spaces, and in many cases their bread and butter products are becoming commoditized and have been under threat due to the migration to public cloud. So even if they have the best HCI or CMP solutions, I don’t see the upside in their stock.

Commoditization is the bane of IT!

I always play it Q/ER by Q/ER to see the results, but I have an itchy trigger finger that once they hit or come close to hitting their stated $3b in billings goal I may sell if I see any dip in growth rate. HCI will eventually have a declining growth rate, so it is a matter if their Other Bets start to surge and offset any HCI decline.

For me, the above is the only reasoning that matters in owning NTNX stock.

New architectures pop up on a regular basis in IT. Old ones don’t die, they just fade away. I wish I could find more pure plays like Nvidia to invest in. “Q/ER by Q/ER” is not LTBH!

NVDA, PVTL, PSTG, ANET are my current IT picks because I think they are close to pure plays. Were I to sell any I would replace it with MDB.

Denny Schlesinger

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#5

HCI is estimated by 2022 or 2021 or some such thing to equate to 50% of database architecture. I don’t have the current percentage of where it is at, but the entire market grew 74% or so last quarter.

As for marketshare, HPE and Cisco are both in the high 4%, with Cisco taking share from HPE last quarter, but it may just be within the statistical error range. NTAP just entered the market and they may have a few million in revenues, basically an asterisk.

The only two players are VMWare and Nutanix. IDC has VMware taking large chunks of market share (something like 11 or 12 points over the last 9 months or so) while at the same time Nutanix also gained a few points of marketshare.

However, it is not that simple to calculate actual marketshare as it all gets mixed up. As an example, Nutanix sells its product, without the support of Cisco, on Cisco hardware. Are any of these OEM sales attributed to Nutanix? Since Cisco won’t break it out for us, probably not. I would not be surprised if Nutanix was their best selling product as well.

So all in all VMWare and Nutanix are head to head, and together have 70% or more of the entire software market, with their share growing. HCI therefore has a lot of room for growth ahead for sure.

Xi however is way behind its scheduled release date. I do think once the Xi overhang is removed some o the perceived risk with Nutanix will also disappear. Then we shall see how these new products sell, and Sherlock is intriguing but probably a year or so away.

Tinker

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#6

Ugh. Starrob’s been recently posting nonsense and incorrect information about things he doesn’t understand to the paid NTNX board and for some reason decided to continue here. He asked for corrections here, but has been unreceptive to the corrections I’ve already posted there. He also compounded the issue by adopting an authoritative tone when he’s actually trying to figure all this out himself via Google.

He’s finally getting a tiny bit better at it. The videos to which he links are fine, if outdated (4 and 3 years old). The Nutanix of today is different. It not only doesn’t even sell hardware any more, it has greatly expanded its offerings.

But, do yourself a favor and realize that Starrob’s explanations of HCI, cloud, cloud computing etc. are often inaccurate or just plain wrong. I don’t know why he delved into Pools. He both wants crisp definitions of terms while at the same time defending his right to be confused.

Perhaps even more importantly, what he’s trying to understand doesn’t help to explain what makes Nutanix competitive or unique, or why an organization would consider their offerings. Without knowing that, all that’s going on is like a distributed cloud raining into data center pools that virtually mean nothing.

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#7

Smorg,
I have been following your posts and I can understand why you might be angry with Starrob, but don’t you think it would be more helpful for all involved to take the bit in your teeth and give a comprehensive answer to actually what Nutanix does rather then telling us all that Starrob is wrong? If you can’t explain what Nutanix is, it really doesn’t help much to tell us what Nutanix isn’t.

Thank you,
Andy

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#8

Trying to rigorously organize and explain what is in essence marketing drivel is an exercise in futility. You actually have to understand the technology to have a reasonable feel for what the company does and what parts of it actually matter.

I don’t know enough about this area to do that, but I know enough to recognize gibberish when I’m hearing it. This sort of approach is not the path to understanding or enlightenment.

-IGU-

#9

but don’t you think it would be more helpful for all involved to take the bit in your teeth and give a comprehensive answer to actually what Nutanix does?

Ummm, I actually did just that more than 3 weeks ago: https://discussion.fool.com/what-nutanix-really-does-33158672.as… , which started with: First, it’s important to understand that the appeal of Nutanix is to replace public cloud usage with Nutanix-run enterprise/private clouds… , went to: What Nutanix provides is an easy way to have the advantages of a private cloud (performance and security and cost), with the ease of cloud management. and ended with: Nutanix has some very cool stuff, but they’re promising more in the future in terms of the “hybrid cloud” than they’re actually delivering today. That may mean the company has a big runway of growth, but there’s also risk in if and when they can actually deliver.

But, my favorite part was explaining what Virtualization is: Like people living in The Matrix, an application running inside a VM thinks it’s running directly on real hardware, but it’s really running in a simulation.

To be fair, it’s far from a perfect post. See subsequent posts in the thread from other contributors for some corrections and additional explanations. Plus, the HCI space and Nutanix in particular are evolving quickly. And, I didn’t talk about Calm, Beam, Flow, or Era.

But, the thing is that until your post, Andy, literally no one else has asked. Besides, as DreamerDad points out, for investment decisions one doesn’t necessarily need to know product details, and especially given this board’s financial & customer growth focus, what the company actually does may not matter at all. Certainly all the recent kerfuffle about nomenclature and whether Nutanix really is a cloud company or not doesn’t matter.

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#10

Smorg,
I have been following your posts and I can understand why you might be angry with Starrob, but don’t you think it would be more helpful for all involved to take the bit in your teeth and give a comprehensive answer to actually what Nutanix does rather then telling us all that Starrob is wrong? If you can’t explain what Nutanix is, it really doesn’t help much to tell us what Nutanix isn’t.

Andy

Andy, I have been attempting to put out a narrative that can explain exactly what Nutanix does and what I just posted was my current best explanation. Some of the things Smorgasborg criticized me for previously have been incorporated in the current narrative, so I am improving it.

I had asked Smorgasborg specific questions on the paid Nutanix board to improve my explanation further, namely:

What is the difference between a public cloud, a private cloud, a distributed cloud and a Enterprise cloud?

And

Can you give a clear explanation, in a way that a Non-IT person can understand, what the difference between Hyperconverged Infrastructure and the cloud?

The answer that I got after much talk about the inaccuracies of previous versions of what posted was this:

I plan no further responses to Starrob here.

Smorgasborg

Even with the post in this thread, he simply criticized the post with implications that it was “wrong” without pointing out in specific what was wrong, so that I can create a new version.

The three to four year videos that I posted, I consider good enough for the basics of Hyperconverged computing. I am making a explanation for non-IT people. I am not trying to create a course to teach people how to operate data centers. I want to make things have to be simple enough for Non-IT people to understand.

If Smorgasborg has something to improve my explanation without over-complicating the explanation than I would like to hear the improvements.

I am not a fan of simply bashing or criticizing my explanation without pointing out in specific what would be wrong because no one learns a thing that way.

I believe that there might be more than a few IT guys that have talked about Nutanix here and elsewhere on the Fool and despite that there still would be Non-IT people wondering “What is a Hypervisor?” would be or “What does Nutanix do?”

That leads me to believe that either people who have the expertise in this area can not explain it clearly enough for non-IT people to understand or the people that have the knowledge inside their head have not been willing to share it with the community.

Starrob

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#11

Look, I for one appreciate respect for all posters.

Second, you are correct that Nutanix is in a risky period, particularly w Xi being so late for delivery and still uncertainty as to whether it will be a successful product or not. That is real risk w Nutanix at present and may largely explain the current valuation. Uncertainty is despised by large investors, but allows smaller investors opportunity.

It is a real risk. A Nutanix investment is investment based upon Nutanix’s brilliant record and extrapolating that they will continue to be just as brilliant moving forward. That
Is a pretty good presumption w this company.

No one is perfect however. A year from now Sherlock may be the uncertainty. Sherlock is the project that extends HCI and then cloud to IoT making all of it one indivisible network abstraction. A very bold vision that Nutanix already has in process.

They deliver…boom! They don’t deliver…not a boom :boom:.

Thus Nutanix is presently in a vulnerable interim period. Opportunity is large if they succeed, less so if they do not.

Tinker

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#12

Starrob,

I appreciated your post. It was informative and created room for discussion so we can learn more.

Tinker

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#13

Hi Smorg,

Ummm, I actually did just that more than 3 weeks ago: https://discussion.fool.com/what-nutanix-really-does-33158672.as…… , which started with: First, it’s important to understand that the appeal of Nutanix is to replace public cloud usage with Nutanix-run enterprise/private clouds… , went to: What Nutanix provides is an easy way to have the advantages of a private cloud (performance and security and cost), with the ease of cloud management. and ended with: Nutanix has some very cool stuff, but they’re promising more in the future in terms of the “hybrid cloud” than they’re actually delivering today. That may mean the company has a big runway of growth, but there’s also risk in if and when they can actually deliver.

Great, Thanks for that. I appreciate it. Maybe that link should be your response to Starrob.

But, the thing is that until your post, Andy, literally no one else has asked. Besides, as DreamerDad points out, for investment decisions one doesn’t necessarily need to know product details, and especially given this board’s financial & customer growth focus, what the company actually does may not matter at all. Certainly all the recent kerfuffle about nomenclature and whether Nutanix really is a cloud company or not doesn’t matter.

I agree, but there always will be people who will try to project that they understand something more deeply then they really do. This can cloud the investment opportunity. I appreciate your willingness to try to clear this up and I understand your frustration when people try to explain something that they really do not understand. I think a rudimentary understanding is good “enough” also but it is helpful to have people that deeply understand the subject. That is why it is great that there are many people on this board that understand their specific technology and can help all of us flesh out our investment thesis.

Thanks Smorg for your response and I will take time to go through your link.

Andy

#14

Starrob,

Andy, I have been attempting to put out a narrative that can explain exactly what Nutanix does and what I just posted was my current best explanation. Some of the things Smorgasborg criticized me for previously have been incorporated in the current narrative, so I am improving it.

I had asked Smorgasborg specific questions on the paid Nutanix board to improve my explanation further, namely:

Don’t take this wrong but you have been trying to explains something that you clearly do not have a grasp on. If you have ever tried to teach someone, you can understand, when a student starts extrapolating ideas that are clearly wrong, and then teaching others those ideas. I think it is best to ask the expert questions instead of telling the experts how something works. Having respect for another persons expertise will create a better learning environment especially on these boards where everything is so linear.

Andy

7 Likes
#15

If Smorgasborg has something to improve my explanation without over-complicating the explanation than I would like to hear the improvements.

Let’s be clear here. It’s not like Starrob posted something like: “I think Nutanix does this, am I right?” No, he used an authoritative tone when he posted what he thought Nutanix did, yet those posts contained factual errors. Not only that, he first did so in a thread where I had already posted some explanations of how Nutanix works, yet he didn’t reference anything in that post. It was just him going off on his own google “learnings.”

Some of the things Smorgasborg criticized me for previously have been incorporated in the current narrative, so I am improving it.
AND
he simply criticized the post with implications that it was “wrong” without pointing out in specific what was wrong, so that I can create a new version.

Inconsistent statements on my criticism’s usefulness from Starrob aside, he is even inaccurate about recalling the past! The response to which he refers was, and I quote myself: “I don’t have the time or inclination to go point by point, but here’s one obvious example” and I gave the specifics. Unfortunately, Starrob responded with counter arguments and even more incorrect information, not a “thanks for the explanation.”

He then has the gall to write here:
The answer that I got after much talk about the inaccuracies of previous versions of what posted was this:

I plan no further responses to Starrob here.

Which again is inaccurate. My response there was not about the many inaccuracies in his explanations, but in response to him attempting to chastise me for not answering a question that was posted in that thread. Well, it turns out the question was about a statement that Starrob himself had made!

I didn’t answer the question because I didn’t know the answer. The question is and was legitimate. Heck, I still don’t know the answer to the question of what Starrob meant by "Hyperconvergence makes one’s own servers respond like the public cloud would.

Maybe he can answer that question now.

Actually, I think that before he posts anything else on Nutanix, Starrob should explain what he meant by that.

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#16

"Hyperconvergence makes one’s own servers respond like the public cloud would.

Smorgasbord1 |

You seem to only want to point out statements where I show that I do not understand something and yet refuse to answer questions when I do ask. I have asked you multiple times, “What is the difference between Hyperconvergence and the private cloud?” I still have difficulty understanding the exact difference and ever since I asked that question, instead of answering you have only responded with criticism.

Starrob

Don’t take this wrong but you have been trying to explains something that you clearly do not have a grasp on. If you have ever tried to teach someone, you can understand, when a student starts extrapolating ideas that are clearly wrong, and then teaching others those ideas. I think it is best to ask the expert questions instead of telling the experts how something works. Having respect for another persons expertise will create a better learning environment especially on these boards where everything is so linear.

Andy

If you would look at my first post in this thread, it incorporates what I have learned from Smorgasborg. Read Smorgasborg explanation here: http://discussion.fool.com/4056/maybe-it-doesn39t-matter-but-the…

If a person would not be in IT then his explanation might be a bit hard to decipher. I am attempting to make something that someone that is not in IT can get a better handle on which would be why I included videos in my first post.

The videos have experts from Nutanix, explaining what they do with a visual representation of what would be going on. Yes, the videos would be three to four years old but they would be simplistic. I find that a better way for a non-IT person to learn rather than a detailed written explanation with no visual representation of the architecture.

If someone wants to criticize that explanation then point out what in specific would be wrong with it, so I can revise it and improve it until it would be both simple enough for a non-IT person to understand and be accurate.

Also, what happens when people refuse to answer the questions that are asked?

I want to know the difference between Hyperconvergence and the private cloud? which I have asked multiple times with no answer.

Starrob

Starrob,

I appreciated your post. It was informative and created room for discussion so we can learn more.

Tinker

As you know…Hyperconvergence would only be one piece of what Nutanix does. My first post would essentially be where Nutanix started. Nutanix started in data center architecture (making both hardware and software) and now they would be moving toward becoming a pure software company while also expanding into the cloud.

I felt it would be necessary to gain that initial understanding of what Nutanix does before explaining some of Nutanix’s other products, namely their cloud management products and Xi, the public cloud initiative.

My first explanations were very confusing because I did not understand the difference between Hyperconvergence and the cloud. I still ask that question…“What is the difference between Hyperconvergence and the cloud?” and I have yet to see a answer from anyone reading the post where I asked that question. Even harder question would be “What is the difference between Hyperconvergence and the private cloud?”

I also think that you would be correct, that Xi being delayed has created uncertainty in Nutanix’s stock.

I am eventually going to get into a fuller explanation of Nutanix that includes what the private cloud is or what I think it is. I suspect that the reason that there’s few answers to that question would be because “Private Cloud” might be somewhat a blend between a marketing term and a technical term.

Starrob

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#17

Just as a aside the following video from VMware shows some specific reasons why a company might choose a Hyperconverged solution over traditional computer architecture. Among the biggest reasons being a HCL solutions would be easier for a company with growing data needs to scale:

Here is what business decision makers need to know about the benefits of hyper-converged infrastructure (HCI). HCI is disrupting the traditional storage and data center markets because it creates enormous value through simplified management, consolidated resources, and reduced costs. Additionally, HCI provides the ideal platform to build a private cloud. Learn more about VMware HCI Solutions

Video: https://youtu.be/qbKCukjgJVs

Among the reasons why I keep asking what would be the difference between a Hyperconverged solution and a private cloud would be because companies like VMware make claims that a private cloud can be built on top of a Hyperconverged Platform. What would be the thing that changes a Hyperconverged Platform into a private cloud?

Starrob

#18

"Hyperconvergence makes one’s own servers respond like the public cloud would.

Smorgasbord1

That’s an incorrect attribution! I did not say that! Starrob said that! Jeez, in how many different ways an Starrob be wrong?

What I did say was:
Actually, I think that before he posts anything else on Nutanix, Starrob should explain what he meant by that.

Which, of course, Starrob didn’t do and apparently won’t do.

I have asked you multiple times, “What is the difference between Hyperconvergence and the private cloud?”

Hmm. I honestly thought that was yet another Starrob gotcha challenge. At this point, his questions are just crying “wolf!” to me.

If anyone who’s not Starrob cares, I’ll do my best. But, past exchanges with Starrob have not been such that I am anxious to engage in a point by point or question by question. Ain’t gonna happen anymore, folks.

My first explanations were very confusing because I did not understand the difference between Hyperconvergence and the cloud. I still ask that question…“What is the difference between Hyperconvergence and the cloud?”

This is TOO much! His first explanations were confusing because he didn’t know the difference between HCI and “the cloud” and yet despite still not knowing he continues to post “explanations.”

He’s literally telling us to ignore him when he explains anything about Nutanix.

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#19

I have asked you multiple times, “What is the difference between Hyperconvergence and the private cloud?” Starrob

Hmm. I honestly thought that was yet another Starrob gotcha challenge. At this point, his questions are just crying “wolf!” to me.

If anyone who’s not Starrob cares, I’ll do my best. But, past exchanges with Starrob have not been such that I am anxious to engage in a point by point or question by question.

Ain’t gonna happen anymore, folks.

Smorgasbord1

What’s a gotcha in that question? You first tell me that I should ask questions and then when I do, you refuse to answer. Instead you walk away from answering. If you won’t answer then I will eventually go out and search for specific answers myself.

Is that a difficult question to answer? Tell me where any “gotcha” would be?

The other question that I asked was, “What is the private cloud?”

This would be the best definition that I can find right now:

Every Cloud model comes with a different set of security and cost related implications. This makes it all the more important for you to decide the right one which fits your business and infrastructure needs.

In this video, James Staten, VP, Principle Analyst, Forrester Research Inc., discusses the transformational economics of 4 different models of the Cloud – public, private, virtual private and the hosted private and how they vary from each other.

Video: https://www.youtube.com/watch?v=qVYMQwSbTSk

Starrob

#20

Great, Thanks for that. I appreciate it. Maybe that link should be your response to Starrob.

Actually, a version of that linked post, on the paid NTNX board, was in direct response to what Starrob posted there - 3 weeks ago!

This can cloud the investment opportunity.

Nice pun there!

1 Like
#21

Great, Thanks for that. I appreciate it. Maybe that link should be your response to Starrob.

Actually, a version of that linked post, on the paid NTNX board, was in direct response to what Starrob posted there - 3 weeks ago!

Smorgasbord1

Of which some of your explanation made it into the first post in my thread. I also used videos, so that people can see what the architecture actually looks like. Your explanation was hard for a Non-IT person like me to understand because I could not visualize the things that you were talking about.

Again, my first post would be so that someone without a background in IT can understand what Nutanix does.

If you can not point out areas in which I can improve my first explanation or answer specific direct questions then I will simply assume that you would be here only to criticize and not be helpful in understanding Nutanix.

Starrob

#22

ENOUGH ON THIS THREAD!!! This is just turning into a back and forth personal argument and attacks of the “I said…!” “No, you said…, but I said…!” variety.

That’s not what this board is about. It’s not helpful. Let’s get back to what we do well.

Thanks for your cooperation,

Saul

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