Nutanix CEO to Partners: ‘Be Patient’ as ‘We Transform Ourselves’
… the channel partner directly and the end-user customer in your peripheral vision — and the two are very different ways of really connecting.
CF: So how will this new approach change your relationship with the channel?
Pandey: We had to do a way better job of enablement, of training, of even going in and looking at them as if they were the customer. I think that makes for a more honest relationship with our channel partners. And when you become a software company, a few things have to change, like doing enterprise license agreements (ELAs) and enterprise purchase agreements (EPAs), and when you talk about subscriptions, there is a whole different offer that you have to bring in front of the channel. The channel is used to selling our hardware, but it now has to be transformed to sell our software and I think that’s the transformation journey we are on.
CF: So what do you see for Nutanix right now?
Pandey: We’ve become a software company in the last two years. We were always a software company, but we had to put this hardware shell around it so the customers could get the best customer experience, just like Apple did. We are out of selling the devices completely. Customers can run Nutanix software on any hardware they want to run it on and on AWS bare metal servers in Amazon data centers. The operating system is becoming more holistic with networking, security, different kinds of data management platforms, backups — they’re all coming together on this platform.
CF: Nutanix customers now buy their hardware preloaded with Nutanix HCI applications from hardware vendors, including your recently widened partnership with HPE, instead of directly from Nutanix, right?
Pandey: Yes, customers have run our applications in the past on Dell servers and Lenovo servers, Fujitsu, Hitachi and others, but HPE is a big part of the overall equation for us. And then in that essence of portability, the fact that we can really take this whole thing to a public cloud is one of the most powerful messages coming from us. Hardware sales are no longer recognized on our books, and it’s not in our profit and loss statement or on our balance sheet. We have a lot of arrangements with the OEM providers so we can actually do combined support.
CF: What’s the next big thing to help Nutanix channel partners?
Pandey: Cloud right now is this vertically integrated stack where no one but the cloud provider makes money. How are we going to make it into pure software so we can turn the channel partners into cloud providers? That is the real future of cloud. But I’m not talking only about professional services revenue. I’m talking about cloud service revenue, which means they are hosting someone’s compute. The thing that channel partners struggle with the most is customer on-boarding, customer experience, customer identity, billing, metering, payment, all the ecosystem. We give the channel partners everything. We’re working on some of these early deals with our service providers where we are saying, “Look, you take the whole thing and nothing but the whole thing.” Now when they host that service and they have customers who have Nutanix hosted on prem, now they can tether the two together and really build hybrid cloud solutions.