Hewlett Packard Enterprise (HPE) recently announced its plans to become a full-fledged, all-encompassing service company for customers of all sizes and workload demands. By 2022, HPE will offer its entire – and constantly expanding – portfolio of software, storage and edge computing solutions as a service through a range of subscription-based, pay-per-use and service offerings. In addition, it will continue to provide hardware and software in a capital expenditure and license-based model, giving customers the ability to better manage costs and operations of their hybrid on-premise and cloud-based systems.
The cornerstone of this ambitious undertaking is Greenlake, HPE’s hybrid cloud, data center and private cloud portfolio. The idea is to offer companies the flexibility and ease of use they’ve come to expect and demand from cloud-based software and services provided for its on-premise IT infrastructure built on a consumption-based fee.
The more you use, the more you pay. Or, the less you use, the less you pay, unlike the standard and much-bemoaned, on-premise-based model that was simply the way it was for decades before cloud computing and on-demand services models arrived on the scene.
Along with giving HPE a much-desired source of predictable recurring service revenue going forward, the everything-as-a-service model promises to give customers a better way to control the overall costs, performance and security of their applications and data with HPE Greenlake Hybrid Cloud.
“We are at an inflection point in the market,” Antonio Neri, HPE’s president and CEO, said in announcing the new strategy. “Everyone recognizes that customers want technology delivered as a service, but they also want it on their terms.”
While traditional enterprise software and hardware vendors for years enjoyed the large margins and bottom-line-fattening services and maintenance contracts associated with delivering apps and hardware on premise, the rise of the likes of Salesforce, Microsoft Azure and Amazon Web Services offering everything from CRM apps to cloud-based data centers for testing and deploying apps forever changed the game. HPE Greenlake, in fact, runs on AWS and Azure.
HPE’s embrace of this everything-as-a-service model isn’t all that surprising as enterprise and SMB customers have grown accustomed to SaaS and IaaS options in recent years. But bringing the entire soup-to-nuts offering to on-premise usage through a subscription- or consumption-based model has been hit or miss so far.
As we’ve seen with everything from music and streaming TV apps to cloud storage and CRM apps, subscription- and consumption-based models are the Holy Grail for vendors looking to lock in recurring revenue and profits rather than one-off deals that can occasionally leave both buyer and seller less than pleased.
Over the years, HPE has beefed up its cloud, intelligent storage and data management portfolio through acquisitions of companies like Cloud Cruiser and, more recently, Cray to put itself in a position to offer best-of-breed technologies to manage and optimize private, public and hybrid cloud usage with an eye on the future.
And that future includes lots and lots of artificial intelligence, machine learning and edge computing functions and applications that will be integral to companies in every industry going forward.
HPE will now offer five new HPE Greenlake offerings for mid-market customers with preconfigured as-a-service workloads for compute, database, private cloud, storage and virtualization. Company officials said these workload optimized solutions will eliminate the time and resources spent designing configurations, building solutions and testing technologies.
It’s also extending the Greenlake portfolio to the edge with its new network-as-a-service offering from Aruba. It will incorporate the breadth of Aruba networking offerings including enterprise Wi-Fi, edge switching, security, analytics and end-user experience validation.
How well HPE executes this new mindset and business model will largely come down to the details. As the enterprise and SMB IT infrastructure expands to include more IoT-based features and tools, this all-encompassing approach to delivering services in this fashion will surely have some ups and downs and an infinite learning curve.
It also means there could very well be more investments and acquisitions down the road to fill in any missing pieces as HPE and its customers learn together.
“We will continue to invest aggressively in this opportunity, to capitalize on our market leadership, leverage our world-class channel and partner ecosystem, and deliver our entire portfolio, from edge to cloud,” Neri added. “As a result, we will reshape HPE and transform the market, with a new and better way to deliver as-a-service.”