NetApp’s Australia and New Zealand (ANZ) team are building on the success of the Keystone data fabric as a service product by leveraging their relationship with managed service providers. Utilizing a shared risk model with service providers, they are driving actual recurring revenue (ARR) and increased market share, allowing the providers and customers to avoid capital expenditure within a volatile market.
Keystone increases enterprise IT flexibility
Enterprises are navigating the very dynamic IT world. Large vendors are not only rolling out features at a faster rate, but they are reshaping their products and services in significant ways. Enterprise customers are in “choice overload” and face a future where determining a winner is impossible; this is most obvious with the cloud market. Hybrid multicloud strategies are gaining momentum as organizations want to leverage best-of-breed options from not only other cloud providers, but from software and services that may be delivered via community or private cloud arrangements. CIOs and CFO are trying to reduce financial risk of this uncertainty by cutting capital expenditure in acquiring ICT assets.
On October 29, 2019, NetApp announced its Keystone initiative, which is based on foundational work progressed in Australia under the title of “Data Fabric-as-a-service.” Keystone is a framework that offers customers a smorgasbord of choice from a DIY on-premises private cloud to a white-glove public-cloud-based services model. All technology available as part of the Keystone framework can be deployed in all environments, from private cloud to the largest hyperscalers like AWS and Google.
The cloud-like as-a-service charging models available under Keystone allows the support of customers who wish to move away from capital expenditure on IT assets. Creating a more predictable and stable expenditure profile over time, while sharing the financial risk as NetApp take the assets onto their books.
Leveraging the Keystone model for service providers
NetApp is part of a complex business ecosystem that also includes resellers and service providers who leverage their data fabric and HCI technology to add value to their offerings. Globally, 76% of NetApp’s net revenue (the fiscal year 2019 annual report) came via indirect channels, in other words, through their partner ecosystem.
In Australia, NetApp is working closely with service providers by providing their multitenanted, multicloud, hybrid infrastructure and software via the Keystone framework. Service providers can leverage the deployment flexibility of Keystone to develop service offerings for sale without having to invest in physical assets without reducing flexibility around future deployment options. This allows service providers to burst to cloud if the uptake of a service exceeds expectation, while also reducing cost on services that do not have the expected take-up. Customers, like the public sector, that require special arrangements can be supported with alternate deployment models with no redevelopment of the service. In this way, service providers can reduce their financial risk while also moving to meet their customer’s desire to move away from capital expenditure.
Moving to a consumption-based model for the underpinning technology, service providers can invest in the development, support and sales of their differentiating features no matter the market they are in. Service providers wanting to branch out into new service offerings or markets can now share the financial risk with NetApp.
NetApp is challenging the relevance of a storage vendor in a cloud-native environment, INT003-000427 (February 2020)
NetApp offers enterprise customers a choice of how to adopt IT transformation, INT003-000411 (November 2019)
Tony Castley, Principal Analyst, Enterprise IT