10 Things You Need To Know About HPE's ProLiant Easy Connect EC200a Hyper-Converged Appliance

HPE Throws New Hat Into Hyper-Converged Ring

Hewlett Packard Enterprise (HPE) this week launched the new ProLiant Easy Connect EC200a hyper-converged appliance, a small Intel Xeon-based cube aimed at accelerating the strategic service provider business model.

The new server appliance, which features a managed services software platform from British software maker Zynstra, opens the door for partners to deliver an on-premise subscription-based server offering for delivering hybrid cloud to small and midsized businesses.

The new SMB hyper-converged appliance, which HPE says is ideal for remote and branch offices (ROBO), is aimed at helping partners and customers avoid the hassle of security patches and updates in a standard strategic service provider subscription model.

The Easy Connect model provides partners the option of backup and disaster recovery as a service with the ability to wrap in their own services, including security and vertical market-based offerings.

A Hyper-Converged Appliance For SMB Customers

With hyper-converged servers reshaping the data center landscape, HPE has delivered what may well be the first hyper-converged appliance built from the ground up for small businesses and remote offices.

The data center equivalent to the HPE ProLiant Easy Connect EC200a is the HPE Proliant DL380 (pictured), which was introduced in May. The Proliant DL380 is aimed squarely at the scale-out data center market, while the EC200a is all about "simplifying a small-office environment with virtualization included," said McLeod Glass, HPE vice president and general manager, tower servers and SMB solutions.

"This is more about simplifying a small-office environment with virtualization included -- not about that data center density," Glass said.

A Competitive Differentiator Vs. Dell And Lenovo

The recurring revenue business model that is at the heart of the Easy Connect appliance represents a big channel advantage versus competitors' offerings, Glass said.

"The business model is not something that is easy to do," Glass said. "HPE as a channel company has been able to put together this model so partners can deliver an OPEX-based solution. This is differentiated from anything else in the market. There is not another solution that delivers the level of integrated IT. We are standing behind our partners' managed services provider business with this product."

The HPE Easy Connect model fits squarely into HPE's SMB plan to deliver "simple and easy to buy and sell" solutions, said Glass. "We are delivering an all-in-one, end-to-end integrated IT-in-a-box solution that fits well into managed services practices" of our partners.

It's All About A More Profitable Partner Business Model With A Higher Market Capitalization

The new ProLiant Easy Connect EC200a hyper-converged appliance provides partners with a platform to power a significant increase in recurring revenue as they move to the strategic service provider business model.

Nick East, the co-founder and CEO of software maker Zynstra, Bath, England, whose patented cloud management and virtualization technology is the central nervous system of the Easy Connect family, says the recurring revenue model is delivering higher market values for solution providers embracing the strategic service provider business model.

"This is delivering more value to the business," says East of the Easy Connect family. "Every time a partner converts a CAPEX sale into an OPEX sale, the value of their business increases by up to five times. Every dollar of CAPEX (capital expenditure on premise IT) is typically worth slightly less than one dollar in terms of the value of the business, while every dollar of recurring revenue is up to five times that."

The new model also provides that highly coveted "stickiness" that comes with a multi-year recurring revenue subscription offering, said East.

Providing Partners With Recurring Revenue Services/Pricing Flexibility

The ProLiant Easy Connect hyper-converged appliance OPEX-based model provides partners with the option of selling one-year or three-year monthly subscription plans.

The HPE pricing model is less than $10 per month, per user, with a 20 percent recurring revenue commission, but partners ultimately have the ability to wrap in their own services and pricing models, Glass said. "We'll provide some directional guidance, but pricing is really up to the partners," he said.

HPE said the subscription model, which it expects will deliver up to a 30 percent lower total cost of ownership for customers compared with a standard SMB server, will be available from distributors.

For partners that do not want to take the OPEX-based one-year or three-year subscription model, HPE is providing a one-year paid-up-front plan.

HPE is targeting about 800 solution providers in the U.S. and U.K. About 30 partners have already signed up to sell the new Easy Connect appliance.

Built On The Latest And Greatest Technology

The HPE ProLiant Easy Connect EC200a appliance, which combines compute, storage and networking, is based on the newest Xeon processor -- the 4-Cores Xeon D-1518, with the latest and greatest HPE technology, according to the company, including persistent memory and Trusted Platform Module security authentication functionality.

The EC200a, available starting April 28, is the first in a series of offerings, with HPE aiming to provide more cloud-based options in the future. The sleek, set-top-box-size appliance (10 inches by 10 inches by 1.85 inches) supports 25 to 50 users and can be clustered together to support hundreds of users.

HPE says the appliance -- which comes with 4-TB solid state Gen3 drives -- includes firewall, active directory single sign-on and cloud-based management, and is fine-tuned for purpose-built application offerings -- including Microsoft Office 365 and Microsoft Azure -- and Flex Bundles such as MS Windows Server 2012, SQL Server 2014, Skype For Business and Lync For Business.

Zynstra's Secret Software Sauce

Zynstra, which has formed strategic alliances with both HPE and Microsoft, says its "secret sauce" is its virtualization software technology that powers the new HPE Easy Connect appliance.

"That has been designed from the get-go to be manageable remotely," said Zynstra CEO East. "It is one thing to deploy a server to the field. It is another to manage it. We have patents around how we do that. The partner is the front line of support. Our secret sauce is to make the software that allows the server to be remotely managed."

The Zynstra software includes a management cloud portal that allows partners to view all of their managed service customers. "As a partner, you see all your customer devices, and you can manage them all remotely," said East.

A 'Set-Top Box' For Strategic Service Providers

HPE Servers Marketing SMB Director David Sung compares the Easy Connect appliance to a set-top box for partners to deliver high-value IT services to SMB customers.

"This is purpose-built for the partner to own that small/medium-sized business customer today and in the future," said Sung. "Think about the margins that this opens the door to."

Up until now, managed service provider partners have been cobbling together "do it yourself" strategic service provider platforms, said Sung.

Partners are already embracing the platform, Sung said, as a way to accelerate their strategic service provider business model transformation.

Glass, for his part, said the biggest game changer for the platform may well be starting the conversation with customers that are looking for the first step on the cloud services journey.

"This opens the door to a real meaningful conversation on how to take IT from traditional IT infrastructure to bridge to cloud services and then bring it altogether," he said.

Accelerating Strategic Service Provider Transformation

HPE sees the new Easy Connect platform powering more partners to make the strategic service provider transformation.

HPE Easy Connect comes with a new generation of strategic service providers acting as independent trusted technology cloud consultants driving business outcomes based on cloud and managed services via a recurring revenue model.

Strategic service providers see at least 20 percent of their annual engagements from business problem-solving rather than procurement, at least 34 percent of overall revenue from services rather than products, and at least 55 percent of total services sales from recurring revenue rather than IT project-based services.

For partners that have not yet made the move to a recurring revenue model, Easy Connect is a "first step" in the transformation. "This is an all-in-one hyper-converged solution that begins delivering on Day 1," says HPE's Sung.

Easy Connect is also a game changer for partners that have begun the strategic service provider transformation but did not anticipate the difficulty of establishing a standardized platform, said Sung.

Finally, the Easy Connect offering provides partners that are well down the strategic service provider transformation path the ability to scale more rapidly, said Sung.

HPE Will Offer Hybrid Infrastructure Workshops

HPE's Technology Services organization has designed workshops aimed at helping customers move to a hybrid cloud infrastructure.

"We're going in and looking at the customer infrastructure and figuring out what should go on-premise and off-premise," said Glass. "We believe our role is to stand behind our partners and help them be that trusted adviser."

The beauty of Easy Connect is it provides the toolset to deliver an optimized on-premise and off-premise solution, said East. "This allows partners to satisfy on-premise requirements, whether it's latency, data integrity or regulatory compliance, and at the same time begin to move customers to the cloud," he said.

Sung, for his part, says HPE's SMB mission is to provide partners anything and everything they need -- from technology services to financial services to ISV partnerships -- to deliver an end-to-end SMB solution.

HPE Aims To Add More ISV Options In Future

HPE aims to build upon the Easy Connect platform with more ISV and managed services offerings.

"This is going to be a family of products," said HPE's Glass. "We are building a very compelling ecosystem of ISV solutions. Think about different vertical applications."

The initial Easy Connect platform includes the latest Microsoft Server operating system, Server 2012 R2, with Active Directory and Azure integration for single sign-on -- allowing users single sign-on to any Azure application, including Office 365 or any other Azure application. Zynstra will provide the automatic update to Server 2016, currently in beta and expected to be available in the third quarter.

HPE envisions strategic service providers' taking their preferred ISVs and integrating them into the Easy Connect service. "This is a 'Swiss Army knife' platform that will allow partners to add ISV services for different industries like medical," said HPE's Sung. "There is tremendous value for partners here."