SAN FRANCISCO – September 18, 2019 – Splunk Inc. (NASDAQ: SPLK), provider of the Data-to-Everything Platform, today announced advancements to pricing, partner and investment initiatives designed to help customers make smarter business decisions by turning data into doing. With the Splunk Data-to-Everything Platform, more than 18,000 customers worldwide are unlocking value and bringing data to every question, decision and action. Read the full release from Splunk:
Analyst Take: This week, Splunk held a high profile event in San Francisco to discuss its new go-to-market strategy. Highlighted by an appearance from former president Barack Obama, Splunk set out to share a new, compelling narrative that will be serve as the company’s centerpiece as it seeks to cement its role with enterprise customers.
What is Data to Everything?
It sounds catchy, and that is on purpose. In an era where everything computes and the flow of data serves as the lifeblood of almost all companies, having a platform that allows data to inform decision making critical. From system availability to cyber security, companies are in a time where data must protect their operations to prevent unnecessary downtime, intrusion and enable agility; Splunk is positioning Data to Everything as an elastic platform, for on or off-premises that can support these important requirements.
Just Marketing or Fruitful Change?
We are certainly in a time where marketecture can displace or misrepresent meaningful change. So it is important to look at the Data to Everything platform launch and consider what is really taking place here.
For Splunk, I believe at the core of this event lived a significant (read: meaningful) migration away from legacy business practices to offer its solutions in a way that matches the way IT departments are looking to consume services.
Here is what the company is doing via its release, and I have coupled it with my take on each pricing announcement.
New Data-to-Everything pricing programs provide flexibility to help customers deliver business outcomes instead of only focusing on volumes of data. These programs provide a wide range of predictability and versatility across the Splunk® product suite.
My Take: The company is moving from a more traditional software licensing model to a consumption based model that fits more with modern app and IaaS investments for both cloud and on-prem.
Predictive Pricing: A new, predictive pricing program facilitates long-term planning for customers and extends flexible, transparent pricing as data volumes grow. Driven by a collaboration with the Splunk community of experts, customers, partners and industry analysts, the new model allows customers to control and manage budgets around this critical asset, data. Predictive Pricing offers predefined pricing tiers from 125GB to unlimited ingestion for Splunk Enterprise, Splunk ITSI and Splunk ES.
My Take: Companies that are investing in an agile data architecture in the cloud are seeking greater pricing transparency. Much like early cloud, the initial cost benefits could often be quickly eliminated with scale and bursting. Today’s CIO and CISO will take comfort in more predictable understanding of how data growth and proliferation will impact bottom line performance.
Infrastructure-Based Pricing: For organizations that want to focus on the infrastructure needed to turn data into doing, customers can now choose to purchase Splunk Enterprise based on the compute power required to run the software on-premises and in the cloud. Data ingestion-based pricing will continue to be available for customers who do not wish to change their Splunk licensing model.
My Take: Much like the above mentioned cloud buyer, consumption based on-prem is growing in popularity, especially in large enterprise environments that are largely moving toward a hybrid model. The flexibility to move to compute power will likely drive more efficiency with increased data volume.
Splunk Enterprise Rapid Adoption Packages: Splunk is unveiling new “Rapid Adoption” packages, starting at $10,000 MSRP, that work for three, four or five use cases. These packages help customers accelerate their data journey with Splunk with the most common IT and Security operations use cases.
My Take: Splunk’s approach to handling net new and in some cases legacy customers that want a better sense of how costs will scale as data volumes and use cases grow.
Data To Everything: Final Thoughts?
Splunk has seen tremendous growth, but to reach new heights the company needed to redesign its offerings to deliver greater accessibility. Its traditional licensing seemed to have some cost prohibitiveness but with a more elastic model and its rapid adoption packages, the new D2E model really enables every enterprise to benefit from Splunk’s analytics.
Today’s announcements represent a positive step forward for the company. It will be interesting to watch customer growth in the wake of the new business model, which should become increasingly apparent over the next two quarters.
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Futurum Research provides industry research and analysis. These columns are for educational purposes only and should not be considered in any way investment advice.