NetApp Cutting 600 Jobs Amid Slower Than Expected Sales, Heightened Competition


Martin said there seems to be a slower-than-anticipated adoption of NetApp Clustered Data Ontap, but that customers are moving in that direction. "It will take some time," he said.

There also seems to be some disruption to NetApp's business by customers' transition to flash storage and the cloud, Martin said.

"This is causing customers to delay decisions," he said. "With our customers, we're seeing two things. The adoption of some of the technologies brought to the table can be slower than anticipated. And we are seeing longer sales cycles for them. Sometimes, new technology can be its own worst enemy."

Selling Clustered Data Ontap has been a challenge, said Scott Robinson, president of XIOSS, an Atlanta-based solution provider and NetApp partner. "The adoption is slower than NetApp expected," he told CRN.

NetApp is also facing growing competition and some pricing pressure at the entry level from several storage startups, Robinson said.

Woodall said that competition from companies like Nimble Storage at the entry level, or even special offers from EMC at the entry level, can impact channel sales on a deal-by -deal basis.

"But from my view of NetApp, that's just normal competition," he said. "Our job as a NetApp partner is to help customers understand the value of NetApp."

NetApp is not the only major storage vendor looking at headcount reductions.

Arch-rival EMC in January said it plans to lay off about the same number of people this year as it did last year, which according to reports was around 1,000 people. However, EMC also said it may still end 2014 with a higher headcount thanks to recruiting of personnel to fill positions in higher growth areas.