NetApp's new CEO pushes ahead with data fabric strategy

Newly-appointed NetApp CEO George Kurian has said that as the company looks to turnaround its business revenue, its data fabric strategy will be a key driver.

It was just over eight weeks ago that NetApp appointed its executive vice president of product operations, George Kurian, to the top job following the departure of Tom Georgens from the chief executive officer role.

The pressure now falls on Kurian to restore growth to the company, which hasn't delivered revenue growth in the last six quarters, and profits have suffered. During the fourth quarter earnings for the 2015 fiscal year, NetApp reported a net income of $135 million, or 43 cents per share. This was down from $197 million, or 59 cents per share, the prior year.

Kurian reassured ZDNet that as the company's portfolio undergoes a transition, earning results such as those previously reported are expected, but he remains optimistic that all the changes will deliver positive results -- eventually.

"I would say all IT providers are grappling with the cloud. The implication of delivering IT is not just on us, but it's certainly something everybody is dealing with, and you'll see us making progress on that front," he said.

In October last year, the company launched the cloud version of its Ontap storage operating system as a way to simplify the movement of data from public to private clouds. The launch was part of a larger push the company has been making with its data fabric strategy.

Kurian said the company's data fabric strategy is about helping businesses transfer not only their data into their environment, but also give them the option to easily move their data out of their environment.

"What we've seen with the advent of the cloud is that your data now, not just your devices, sits in multiple locations. To be able to run an integrated business process and to be able to share data across these environments, you need the data element to be connected," he said. "Network fabrics provide connectivity to those different elements and data fabric integrates the data management of all those environments."

As a result of making changes to its product portfolio, Kurian said the company has seen 13 consecutive quarters of triple digit growth from its new architecture.

"I think our core business was built on up a scale-up design and we've been very successful with that for more than 20 years. As we look out towards the evolution of people wanting to build their own cloud or integrate with multiple public clouds, we realised we need to build a new architecture and we've been doing that," he said.

Kurian added that at the heart of the changes the company has been making has been its evolving partner ecosystem, which now includes major cloud providers including Amazon and Microsoft Azure.

"We rely on partners who have expertise in all of the elements that comprise of supplying all solutions to customers computing, applications software, virtualisation, and management," he said.

"Our belief is that partnering well with technology providers, as well as solutions integrators and service providers is core and fundamental to our strategy."

According to NetApp Australia vice president Steve Manley, in Australia 70 to 80 percent of the business is driven by channel partners, with plans to further grow that, while in New Zealand channel partners make up 100 percent of the business.

"In the last few years we've cut in half the number of channel partners and doubled our revenue. We've had great success identifying strategic partners and some of them have been growing 100 to 200 percent -- a huge success," he said.

In fact, according to NetApp APAC president Rick Scurfield, from a regional perspective, Australia is a market to watch.

"We think this is the country that is going to be the leading indicator for APAC and the rest of the world. We have all this technology, all this infrastructure, we know how we can leverage it, we understand the cloud, we're putting together the architectures, now we want to focus on the best way to optimise the buying power we have," he said.

The company has already won contract deals with organisations including the National Computational Infrastructure, ING Direct, and CoreLogic.

This is opposed to China, which according to Scurfield, remains in "chaos" and difficult for NetApp to do business in.

"They have their strategic visions about creating cities or plans for their political motivations, but when it comes to how to really implement or introduce IT in those markets, it is incredibly challenging," he said.

"They will go out with public announcements about how they are an open and free market for best of breed technologies, but under the covers they will actually be saying inside their own ecosystem, 'this is a very closed community and we want to make sure our Chinese providers get preferential treatment in areas where they can control.'"


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