According to this morning’s news, it would seem that HPE is buying Simplivity at the bargain price of $650M. I’m not sure Simplivity’s investors have the same opinion but for HPE, if well managed, this could be another 3PAR-like success.

Simplivity did good…

hp-announcement-logoSimplivity holds the number 2 position in the HCI market, after Nutanix. In fact, it’s somewhat lagging behind from the features point of view, it doesn’t have its own hypervisor and vision but, on the other hand, I found the company strategy less intrusive and having a much more pleasurable attitude. Don’t get me wrong, Simplivity also has some pros, especially when it comes to data protection (For example, I really love how they use their deduplication features and integrated backup/DR functionalities in their solution).

…and HPE will do the rest

Simplivity has a good product and HPE has huge sales channels. At the end of the day $650M is not a major investment and, when necessary, HPE will be able to slash the price to close deals. Fueling server sales is the final goal after all, isn’t it?
HPE will be tougher to beat than Simplivity alone and I’m sure that other competitors will soon be aware of this. Especially in larger contracts (with networking and external storage), its competitiveness will improve and there are only few contenders that could do the same (Dell is the only one that comes to mind at the moment).
It is also true that Simplivity will no longer benefit from the CISCO partnership, but I suppose that business with CISCO, after Hyperflex, hasn’t been as good as in the past… that would also explain, partially at least, why HPE got such a good price.

Closing the circle

HPE needed this… as I wrote in my comments after HPE Discover. This will also help to make more sense of all its Synergy platform and… I can only imagine how HPE sales must be cheering this news.
If they don’t screw it up and allow Simplivity do its job, I’m sure it will be a success comparable to the 3PAR acquisition.
Nutanix still maintains a certain lead from the technical perspective, but it’s becoming ever more difficult to compete. With all primary vendors having “good enough” (or almost on par) solutions, the price will become a heavier component of every deal and Nutanix can’t continue to burn money indefinitely… Am I wrong?