NetApp Launches Keystone Hybrid Storage Services with Subscription Billing

(Pictured above: NetApp CEO George Kurian on stage at NetApp Insight, Oct. 29.)

NETAPP INSIGHT — NetApp aims to simplify how partners sell and manage its entire storage management offerings with a an as-a-service subscription billing approach to its entire portfolio.

The new Keystone program, revealed Tuesday at the annual NetApp Insight conference in Las Vegas, lets customers procure NetApp’s on-premises storage solutions as a service and pay monthly or annual subscription fees. Keystone allows bursting on-demand as well. Customers can subscribe to NetApp’s various solutions without taking title or leasing the equipment, while partners can offer their own managed services or use resell those provided by NetApp.

“NetApp Keystone enables you to simplify the business of hybrid cloud data services,” said NetApp CEO George Kurian, speaking in the opening keynote session of NetApp Insight. “It gives you the flexibility and the agility to operate IT to transform your business. It provides flexible cloud consumption models that make it easy to buy, easy to consume and easy to operate NetApp capability, whether it’s on-premises or in the public cloud. You get to pay for it as a utility, as a subscription, or with a capital purchase.”

Kurian emphasized that Keystone works with NetApp’s Cloud Data Services that run in Amazon Web Services, Microsoft Azure and Google Cloud. The subscriptions to NetApp solutions are available with a minimum one-year commitment that allow partners to specific a level of performance, a storage type such as block, file or object, and can select whether it will be a NetApp managed service or one provided by the partner.

NetApp will continue to allow customers to stick with capex purchasing with Keystone, which also aims to simplify selection and procurement of solutions through an improved interface for quoting. The subscription version of Keystone is available immediately, while a reseller model through NetApp’s distributors will roll out later in the year, according to Chris Lamborn, the company’s global channel chief.

Lamborn told Channel Futures that Keystone builds on the NetApp OnDemand offering, a subscription-based service offered for high-end enterprise customers. While NetApp holds title to systems with that offering as well, it is less service-oriented than Keystone and is more focused on products.

NetApp’s Chris Lamborn

“If you look at how the market is changing, what customers are looking for is a no-risk, on-premises solution with low capital needed,” Lamborn said. “Ultimately, people want it to be the same as you get on-premises, the same as the public cloud. So, if you look at how this has evolved, we’ve taken the best out of NetApp OnDemand, the best out of our other financial solutions, and pulled them into the Keystone consumption subscription model.”

Partners say NetApp isn’t the first storage provider to introduce shift more aggressively to subscription and consumption-based acquisition of infrastructure. HPE with GreenLake and Pure Storage are among others that have rolled out such services.

“It gives me a great deal of flexibility and gives customers a great deal of flexibility,” said John Woodall, VP of engineering at NetApp partner Integrated Archive Systems, adding that he welcomes the choice of delivering his managed services or providing NetApp’s managed services. “My first preference, from a dollars and cents view, is to offer it as my managed service, but I can easily see just from a deal velocity perspective, just having the option to sell this entire package offering to a customer, which includes NetApp managed services.”

Insight’s Suzanne Backer Gallagher

Suzanne Becker Gallagher, VP of cloud and data center transformation at Insight, said Keystone follows a growing trend among infrastructure providers.

“Everybody’s got to have a consumption model and have something that works and comes through the channel,” Gallagher said. “It’s exciting that NetApp is now coming to the table with a more official kind of consumption structure and model. Like everything else, though, it’s a transformation process for clients to be able to really move to a consumption-based model. Some are doing it a workload at a time and some are doing it in a platform at a time. And NetApp now having something like this is super important.”