Fanning the Winds of Change in Storage

It’s been over a month (and three hurricanes in America) since I’ve posted a blog. More than a few of you’ve noticed – thanks for the prodding…



It’s been a busy summer, on nearly every front. Customer activity hasn’t slowed down, and the good news surrounding the (otherwise unfortunate) economic crisis embroiling many customers (especially those in the financial services industry, a heavy concentration for Sun) is that it’s whipping up the winds of change. Customers facing spending pressure, or tiring of vendor price increases have new options, and there’s a new appetite to explore those options (nothing like mandates from the CEO to reduce spending by 50%).


One of my more interesting recent meetings wasn’t with a customer, though, it was with an equity analyst from a global financial institution. Equity analysts publish research that feeds the investment community – their (free) research and financial analysis accompanies buy/hold/sell recommendations to investors (who hopefully generate trading fees for the analyst’s employers).


This one analyst hadn’t historically followed Sun, and was in the process of developing his first rating. He wanted to focus on our storage plans – more and more of the customers whom he interviewed were focused on storage, and many were talking up a specific open source software technology: ZFS. (Before meeting with me, he’d talked to colleagues in his own IT shop, and was impressed to find some who admitted to running ZFS at home – nothing like touching your customers where they live… if you’d like to have ZFS sent to you, click here or on the LiveCD shown at right.)


Granted, you can see an increasing focus on storage at Sun – the acquisition of MySQL is as much a storage acquisition, as an enhancement to Sun’s developer offerings. Discussions of flash memory, the economics of archiving, the Lustre parallel file system, all point to an increasing focus on what Sun sees as an exceptional opportunity for customers (and thus, investors). Storage and computing are converging – and we’re about to bring the trends that transformed the server industry a few years ago (mass engagement in open development communities, and scale achieved via clusters of commodity parts vs. proprietary technologies) to the historically closed and proprietary storage industry.


Now, the notion of “engaging customers in open development communities” doesn’t sit well among some traditional storage analysts (or our competition) who believe “Storage is too mission critical to tolerate open source software.” Although I appreciate that wisdom and experience, I think the market’s more nuanced than that – mission critical environments don’t tolerate unsupported software, true, which is why we offer 24×7 commercial support for ZFS (on Sun hardware, and Dell, even). But broad global adoption of key open source projects will continue to drive change deep into the world’s datacenters. Gartner’s prediction that 90% of world’s companies will run open source software didn’t specify where they’d be running it – “everywhere” is the safest bet.


But back to the equity analyst – he patiently asked, “Great theory, but when will you see revenue results?”


“Last year,” I responded. “You’re seeing it accelerate.”



As many folks know, we shipped our first ZFS based storage systems in 2007 – known as Thumpers. Thumpers finished up this last year generating around $100m in billings, up 80% year over year. From a capacity perspective, we delivered roughly 90 petabytes of Thumper storage in FY2008, to some of the most demanding storage installations on earth (up ~200% y/y). What’s fueling the growth? Adoption of ZFS is a clear driver (this chart gives you a sense of where we’re seeing adoption – thus revenue opportunity). But ultimately, customers are recognizing they can save money, space and power. Thumpers are roughly twice the capacity in half the space at half the cost of the competition – $1.20/Gigabyte. (They also run Windows and Linux with the same hardware economics).


Now, our view is “OpenStorage” (systems built from commodity parts and open source software) will grow far faster than the proprietary storage market. We plan on driving that growth, and over the next few months, you’ll see a tremendous amount of storage innovation targeting the growing breadth of customers wanting better/faster/cheaper/smaller options. Expect to see flash, zfs, dtrace, and good old fashioned systems engineering play a very prominent role in an aggressive push into the storage market.


And in case you missed our announcement last week, our progress was validated by industry analysis – IDC said customers are growing their disk storage business with Sun far faster than with any of our proprietary competition. And at three times the rate of the overall market’s growth. A great place to start.



If you’d like to know more, and might be interested in taking a Thumper system for a free trial run, just click here and pick the country in which you’re located. We supply most systems at Sun for free trials across the globe (yes, we even cover shipping to you). If you like the system, please buy it. If not, we’ll take care of getting it returned to Sun, you owe us nothing. (That’s the closest we can get to free hardware downloads…)


As I said to the analyst, you need only look to the results we’re already delivering to see the linkage between open innovation and revenue growth. ZFS won’t transform demand for our legacy products, but it’ll certainly transform the opportunity and industry unfolding before us. But don’t just get our opinion, the best folks to validate our approach aren’t at Sun, they’re among the storage buyers finally feeling the winds of change – at their backs.

24 Comments

Filed under General

24 responses to “Fanning the Winds of Change in Storage

  1. whystopnow

    Of course, then the analyst looked at the margins on Thumper and other commodity systems and rated the stock as Market Underperform.
    For all the cool stuff Sun does, the reality is that the legacy business (big Enterprise SPARC) is the only real moneymaker in Sun, and it’s getting smaller every year.

  2. Kevin Hutchinson

    Great to see you back blogging again – especially about open source. Here’s a great interview with Sun’s Open Source/Standards boss Simon Phipps talking about the global change from a hub-and-spoke proprietary world to a meshed world of involved communities: http://www.twit.tv/floss39
    I think I’m finally starting to get it. Good luck with FISHworks, and congratulations on getting xVM Server launched this week.

  3. Ewen Chan

    Might I suggest that tutorials and how-to guides and best practices guides be written so that it would be able to help a much wider breadth of ZFS adopters to help people like myself get the most out of the system?
    Start with answering/addressing "how do I prepare a system for ZFS?"
    I already run ZFS at home, but I do worry about data integrity as a result of NOT having set up/configured ZFS, from the ground up, properly.

  4. So tell us about this box- what types of drives does it support? 7.2k RPM as well as 10k and 15k? Are the drives hot swappable? What raid is supported? Does it do any disk level protocols in addition to (or using) ZFS? Can the box do external mirroring, internal point in time copies, thin provisioning (for disk protocols), deduplication, or any other neat tricks? I don’t know much about ZFS, so some of these functions might be integrated…
    I suppose asking here is a little silly because you’re probably going to have to get the answers from an engineer, but I don’t have much Sun face time and have nobody I can ask myself🙂
    Also- you should consider appointing a Sun Storage blogger who can represent your line in the blogosphere.

  5. Barry Sant

    To WhyStopNow – I’ve heard Sun say margins on Thumper are "above their corporate average," god knows the other storage vendors have ridiculously high profit pools to be drawn from.

  6. Greetings Johnathan,
    Again — I’ve been following the sun ticker and was disappointed to see a sub-par performance in the market. Why is Sun not pulling through in that aspect, despite having so much brilliance that can work for it?
    There are only 3 innovators left in the IT world today — Sun, Apple and Google. Why is it that the latter two are doing well but Sun isn’t?
    I see a huge gap in public perception/visibility. The obvious goodwill among us engineer-types is not percolating to the masses. I think Sun will do well in the stock markets only when Joe Somebody (non-tech) gets to know about what and how cool Sun’s technology/engineering really is.
    When are you guys going to get it? Between Jerry Seinfeld and Justin Long…it is that obvious and staring you right in the face!

  7. loquitur

    Much as I like ZFS (it will be showcased on Apple gear, it is something Linux
    doesn’t have, it plays well with Flash, etc.), its valuation within JAVA remains
    invisible. I remember it was supposed to "disintermediate" vFS from Veritas,
    yet the owner still sells $1B worth of this legacy code, and is valued at 3X sales to boot.
    Also, since the last blog, the market cap of NTAP has surpassed JAVA, and
    they bundle their filesystem code with low-margin hardware just like Sun.
    Other software-intensive parts of Sun are being held underwater as well.
    Middleware companies ran with Java to the tune of billions in market cap,
    RHAT is still worth $3B+ as a Unix clone servicing company, VMware is a
    tiny subset of what JAVA offers and yet is worth more than twice JAVA to Wall St.
    How will these disparate values be arbitraged?

  8. Peter Firmstone

    Welcome back Jonathan,
    Many organisations don’t realise the importance of storage until they experience failure or data loss.
    The upshot here, Sun is touching hordes of new customers and Solaris is good for more than just file storage. Solaris is a bit like nicotine, once addicted, it’s hard to give up, but unlike nicotine, its good for your health. Open Platform, self motivation beats the big stick of proprietary vendor lock in, hands down.
    N.B. On the Solaris registrations map, I noticed there’s not much showing for Sparc in OpenSolaris, I’m unsure of the statistics, although I suspect most OpenSolaris installations will be used primarily as desktops by developers, the curious enthusiast or sysadmin. I think I speak for others when I say: "I’d like to join in the fun, however sparc hardware driver availability issues prevent me." Hopefully someone soon will make it possible to install 3D Accel Frambuffers into a shiny new Niagara II server.

  9. Cindy

    For Ewen Chan, please visit the ZFS configuration wiki at this location:
    http://www.solarisinternals.com/wiki/index.php/ZFS_Configuration_Guide
    You can also review the ZFS best practices wiki to ensure that your existing configuration is set up properly:
    http://www.solarisinternals.com/wiki/index.php/ZFS_Best_Practices_Guide
    If you have specific questions about a ZFS configuration for your environment, join the conversation on the zfs discussion list, here:
    http://opensolaris.org/os/community/zfs/discussions/

  10. UnHa Kim

    It’s good to see you back to blogging.
    I am not your customer (yet) but I cross my finger for your success.
    And I hope Sun show to the world how open source model succeed and win over traditional competitors.

  11. Larry Chen

    What if … Sun licensed ZFS to MS? Cat5, no?

  12. Very good points Jonathon….they really don’t get it until failure!
    Tre Allen
    President
    http://www.truckmountforums.com

  13. Hello Mr. Schwartz,
    On the website of CERN labs, there is a photo gallery. The pictures show that people are running Solaris. I don’t know for sure if they are or not. But if they are then that’s awesome to have an open source OS powering one of the greatest experiments in history.
    Regards
    Hasan
    University of Maine

  14. Michael Greenberg

    Hi Jonathan,
    I just want to say that at my organization we’re very excited about OpenStorage. We’ve been implementing it on dozens (soon, hundreds) of terabytes of commodity disks (including Thumpers) providing truly outstanding performance and reliability.
    I feel you’ve neglected to mention the SXCE’s COMSTAR framework which brings the Thumper (and other OpenStorage solutions) to the FC SAN fabric.
    Frankly, when I told the team that supports us at Sun the wonders I do with it, they were astonished. So were all of my colleagues.
    COMSTAR+ZFS allows customers to build solutions similar to IBM’s newly acquired XIV merely for the cost of cheap disks and a server (e.g. some J4500s and a T5240)!
    It is the most exciting thing that happened to storage in years!
    Anyway, keep up the good work… And work a bit on the publicity – people are starting to forget what Sun and Solaris truly are in enterprise computing, and it would be a shame to see all that jaw-dropping technology disappear due to its annonymity and terrible marketing (no offense there).

  15. Mdavis

    Yes, welcome back! Sun has always proven itself in the open source model and I’m thrilled with the acquision of MySQL – I look forward to continuing success from one of my favourite companies.

  16. John Smith

    Until Sun stock goes up, this is just Hot Air.
    Note that very few negative comments are posted.
    They never reach the CEO. He is happy that every thing
    is going great. Oh no, not at all.

  17. I agree with the commented above who said Sun needs to get in front of the common man. In fact, I think Sun should do microsoft one better and hire Michael Richards for the Sun-is -not-that-bad campaign.
    For more insight, visit the FakeJonathan twitter page: http://twitter.com/fakejonathan

  18. Bill_W

    Sun could challenge mighty VMware in the desktop.Us longs love to hear this!!
    Enjoy your blogs,but try to make them more often if possible!! 8>)

  19. James Faircloth

    Long time reader, first time poster.
    Love the blog. Hate the 321k picture of a fan and the 379k picture of the server.

  20. Open Source equals Share Price crash

    I can see why customers and geeks love Open Source
    – former get their goods cheaply
    – latter see this helping the community
    However, this is such a dated idea. Much like in "the old days" where scientists published their results for all to see, regardless of the fact the scientists wouldn’t make a bean, but others – using their discoveries – would make vast fortunes.
    Alas, this is Sun.
    Customers keep their costs down, make good profits, company is happy, share prices goes up, investors happy. Everybody’s happy.
    Sun make little profit, too busy chasing vast numbers of customers doing free downloads, wanting to be felt to be doing good. Company lays off workers, share price crashes (almost 60% – yes, that’s 60% – down in the last 12 months). Nobody’s happy.
    Bottom line – Sun: forget saving the world, try saving your company.
    And, yes, I’m a shareholder.

  21. Kerren Towe

    Why don’t you stop writing this stupid blog until your stock price recovers. Your shareholders don’t want you wasting time on this when you should be spending every minute getting the price up.

  22. to Kerren Towe

    You really think Jonathan writes this himself? He has to have a "communication manager" handling this writing. Or it is dictated.

  23. Sun could challenge mighty VMware in the desktop.Us longs love to hear this..!!

  24. wow, 90 petabytes that´s a lot. What I wonder about is why you like to go for Open Source. This would be a crucial threat to the reliability and the security of your system, wouldn´t it?

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