HPE Storage GM: Dell-EMC Are Two 'Declining' Companies Struggling In Full-Stack Converged Infrastructure Era

Hewlett Packard Enterprise Senior Vice President and General Manager Manish Goel Tuesday characterized Dell-EMC as "two declining" companies struggling to make it in the full-stack converged composable infrastructure era.

"If you take two declining companies and put them together, they still remain two declining companies that will decline faster together," said Goel in an interview with CRN at the HPE Discover conference in Las Vegas. "There is just going to be a ton of uncertainty [as they merge]. Regardless of any strategy, any execution, one thing is undeniable: All the focus of Dell-EMC for the next 18 to 24 months will be inward, not on their customers, not on their partners."

Goel's comments come amid an all-out HPE recruiting blitz aimed at bringing Dell-EMC partners into the HPE fold. As part of that drive, HPE has invited several hundred Dell-EMC partners to private meetings at Discover aimed at getting those partners to sell the HPE product portfolio.

[HPE Steps Up Innovation Offensive: 10 Hot New Product/Sales Plays From Discover 2016]

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The HPE program, which internally is called Smart Choice, includes special accommodations so partners can move into the HPE channel program at the same level they are at with Dell-EMC.

Goel pointed to EMC's decision to merge with Dell as the biggest proof point that the days of pure-play vendors like EMC and Cisco are coming to an end.

"You don't need another proof point than to say the No. 1 storage player EMC realized they couldn't make it alone so they sold themselves to a commodity compute vendor," said Goel. "If you need a proof point that the world is moving to full stack and pure-play guys aren't going to make it, you just have to look at that transaction."

HPE executives are drawing a sharp contrast at Discover between HPE's decision to slim down and drive more innovation as a smaller and more nimble company, while Dell is moving to get bigger and taking on debt.

"We are focused," said Goel, referring to HPE's decision to split last November from the HP Inc. PC and printing business. "We have done all the hard work. We have gone through a separation. We are very clear on our intent. We are very clear on our strategy, and we are focused on our customers and partners."

Goel said dramatic HPE advances in the full-stack converged infrastructure era like Synergy Composable infrastructure and StoreServe's common data fabric provide a huge competitive advantage against Dell- EMC and other vendors struggling to keep up with a fast-moving and agile HPE.

"When these kind of transitions are taking place, you cannot lose a beat," he said. "We are focused. We are not going to lose a beat. Cisco is trying to figure out what they want to be when they grow up. Dell and EMC are busy integrating two giant companies, and we are focused."

Goel said Cisco is simply not a full-stack vendor and lacks the critical storage component in the full-stack converged infrastructure era.

"When you don’t own the critical part of the stack, you simply cannot drive the innovation agenda," he said, referring to Cisco. That is what it boils down to: your innovation program is partial and it is focused only on the things you understand, but that doesn't solve customer problems."

As for IBM, Goel said he sees IBM pulling out of the hardware infrastructure market in the full-stack converged infrastructure era. "They have simply chosen to redefine the game they are playing," he said. "They are not playing the infrastructure game. They have vacated that game."

HPE, meanwhile, is stepping up its next-generation infrastructure with offerings like Synergy Composable infrastructure and new efforts to modernize the data center like Docker software container support for HPE systems and an all-out flash data center drive.

As part of that all-flash offensive, HPE Tuesday said it is stepping up its attack on rival EMC with the announcement at Discover of a new HPE 3Par StoreServe product that supports 7.68-TB and 15.36-TB 3-D NAND solid state all flash drives -- supporting up to 24 petabytes of SSD capacity. HPE is claiming the new functionality delivers seven times better density than EMC's all-flash systems.

Goel said HPE is driving innovation in the full-stack converged infrastructure era at a breakneck pace. "We are the only company with a clear sense of mission and a clear product portfolio," he said. "We are focused on our customers and our partners."

HPE Senior Vice President Kerry Bailey, who met with a group of Dell-EMC partners at Discover, said the HPE message of stability and innovation is resonating with Dell-EMC partners who fear "double-sided" disruption as Dell-EMC moves to integrate the two companies.

Bailey said the Dell-EMC Smart Choice program is following the same path that led HPE's IBM Smart Choice program to drive $1 billion in additional sales in the wake of Lenovo's $2.1 billion acquisition of IBM's x86 server business two years ago.

HPE partners at Discover, for their part, said they see the Synergy Composable infrastructure offering providing a huge competitive advantage over competitors like Dell-EMC, Cisco and IBM.

"Synergy is actually the coolest thing I have ever seen from HPE," said Steve Tepedino, president and CEO of IT Partners, one of HPE's top enterprise partners based in Tempe, Ariz. "Synergy is what customers are asking for: a simplified software-defined layer that makes it easy to consume infrastructure. As we deliver Synergy we have a cool on-ramp to things like containerization of applications and true hybrid cloud computing. When you put [HPE] Eucalyptus on top of that, we are going to have an on ramp to public cloud providers and, just as importantly, an off ramp. With HPE we have the slickest hybrid IT story in the business – bar none. That gets us excited. We are big time pumped up."

Kelly Ireland, founder and CEO of Orange, Calif.-based CB Technologies, an HPE enterprise partner that is working closely with HPE in top accounts on next-generation infrastructure solutions, said HPE CEO Meg Whitman's heavy investment in innovation combined with its sharp focus on next-generation infrastructure is paying off for HPE partners.

"It all starts with the right technology," she said. "What Meg has done – whether you are a solution provider or a service provider – is she has given us the breadth of hardware and software we need to be successful. That puts us in a leadership position in everything we do."

When asked for comment, a Dell spokesperson pointed back to remarks made by Dell Chairman and CEO Michael Dell in his keynote address at last month's EMC World.

"Our competitors like HP are shrinking their way to success," said Dell. "Wait, you can't shrink your way to success. That is not even a real thing. But they're doing it. They are getting smaller. They are separating their edge from their core with far less revenue, less innovation in R&D, less software, a smaller supply chain, losing share in each of their businesses to Dell, even right now during this period."

EMC declined CRN's request for comment.