The Six Five team talks with HPE’s Phil Mottram about how HPE Aruba’s NaaS solutions help our partners and customers rapidly deliver networking services with a single platform for all connectivity.
To learn more, visit HPE GreenLake.
Watch the interview with Phil here:
Listen to the episode on your favorite streaming platform:
Be sure to subscribe to The Six Five Webcast so you never miss an episode.
Disclaimer: The Six Five Webcast is for information and entertainment purposes only. Over the course of this webcast, we may talk about companies that are publicly traded and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors and we do not ask that you treat us as such.
Announcer: Welcome to The Six Five On The Road for the HPE Green Lake announcement at the Hewlett-Packard enterprise new global headquarters in Houston, Texas.
Patrick Moorhead: Hi, this is Pat Moorhead, and we are here at HPE’s new corporate headquarters in Houston, Texas. And I’m here with my Six Five podcast co-host Daniel Newman. How are you, my friend?
Daniel Newman: Doing great, beautiful new facility. Excited to have these conversations about these Green Lake announcements being made, some remote, some here in person, but it’s going to be fun.
Patrick Moorhead: I know, I’m looking forward to it.
Daniel Newman: So the first conversation, we’re going to be bringing in Phil Mottram from London, I believe it is.
Patrick Moorhead: I think it is.
Daniel Newman: Yeah, we’re bringing people from around the world, and we’re going to be talking about some of the announcements made around Network as a service. Phil, welcome to The Six Five On The Road.
Phil Mottram: Thank you. Great to be here.
Daniel Newman: Yeah, it’s great to have you here. Look, there’s a lot of announcements that are going on. We’re excited to have a number of these different conversations, and a lot of it’s about momentum. A lot of it’s about the momentum that you’re having, the Green Lake business, a lot of pedigree, as I like to say. It’s been around for a number of years. It’s starting to see some really impressive growth. I believe last quarter, Pat, it was like 100-plus percent growth in the Green Lake business. And you and your team are working on some announcements around Network as a service. So maybe we’ll start there because NaaS and everything AAS little bit catchy, but for everyone out there that’s listening and checking in, just give a little bit of the background about what is Network as a service.
Phil Mottram: Yeah, sure. So, as you say, demand is high, but understanding is not. Within the Aruba business, we’ve been offering NaaS services through our Green Lake Aruba Central platform now for a couple of years, actually. We’ve actually today got 120,000 customers connected to the platform and 1.9 million devices. So Network as a service, where it’s slightly different from Compute and Storage as a service is with Network as a service, you still need equipment at a particular customer premises in order to get the coverage for the network, be that wireless networks or wired networks. So that’s one of the subtle differences between Network as a service and other as a service platforms. So that’s the first thing.
In general, Network as a service involves equipment, and it also involves some cloud-based Software as a service, and last but not least, it also involves some life cycle management. So what we do, as a company, is we deliver the Network as a service to our customers, and we manage that for them over the course of a particular period of time. I guess another thing as well that’s slightly different about Network as a service is we also give customers the opportunity to flex up and flex down depending on how their business is growing or changing. So that’s another aspect of Network as a service. So it’s not just outsourcing, it’s not just around OPEX payment profile versus upfront payments. The way to think about it is, you’re no longer buying things and devices, but you’re truly buying a service, so hopefully that was clear.
Patrick Moorhead: Yeah, it is clear. And the whole Network as a service, I was actually a little bit surprised, but I shouldn’t have been surprised because there’s a lot out of Compute as a service. There’s Storage is service. So why not Network as a service? I hope nobody confused it with NAS, Network-Attached Storage, when we talk through that, but that’s what one of our jobs, as pundits, is to make sure that we’re educating the market out there. So it’s a huge day for HPE Green Lake, and you made a few announcements today. I’m wondering if you could maybe talk through, at a high level, what you announced?
Phil Mottram: Yeah, sure. So on the Aruba side, what we did was to say we’ve had the Network as a service offer now in the market for just over two years. And I think the first deals that we did were for larger customers and typically bespoken quite custom in terms of the requirements, but what we’re announcing today are eight new offers in the Network as a service space. And what the eight offers do is they take the Network as a service offer and make them more standardized and repeatable. And then what we do is we offer those offers not only to customers directly, but more through partners. So we’re basically partner-enabling the Network as a service offer. And what that enables our partners to do, and we’ve got lots of partners in Aruba, is it allows them to take the offer forward into the market and then deploy the services, the Network as a service, and add additional services that they may want to offer to customers. So that’s all around the announcement today.
Daniel Newman: Yeah, so we’ll have to go ahead and throw the links in the show notes. I was thinking about asking Phil to name them off real quick just for fun, but I’m not going to do that here.
Patrick Moorhead: Check the show notes, everybody.
Daniel Newman: But yeah, in the show notes we’ll put what those eight announcements are. You started to allude to this a little bit, Phil, when we talked about what is NaaS… And again, I feel like I got to be careful NaaS, not network-attached storage, but about customer benefits and such. So as we rethink the way customers procure and deploy, which is part of what these announcements really focus on here, talk about some of the benefits for customers that make this investment in working with you guys around their Network as a service.
Phil Mottram: Yeah, sure. So in terms of some of the benefits, the first thing is we do actually quite a lot of customer research. We either talk to customers directly, and also we use analyst firms such as yourself. And the understanding that we have from the market is by about 2025, about 65% of customers will be buying Network as a service. And the reason that customers like it is the fact that it smoothes the commercial profile, because I guess, in the old world, when you were buying network equipment and services from suppliers, you used to have to make a meaty, upfront payment and then do annual maintenance fees. And what we’re doing now is we bundle that all into one particular offer. And so for businesses and our customers and partners, it gives a predictable monthly cost. Within that cost, we’re responsible for supplying the equipment, deploying the equipment, making sure the software is up to date, and the general life cycle management of the platform.
Another benefit as well around offering Network as a service is we offer partners and customers the ability to be able to flex the model. So if they want to add branches, for example, if they’re a retail institution or maybe they’re closing branches, what we can do is we can flex that monthly fee. So it gives customers the ability to be able to tie the commercial model directly to the running of their business.
Patrick Moorhead: Yeah. I mean the level of benefits of as a service, I mean, in our research, I mean, it’s crystal clear. And even though most people are talking about it, more people are talking about it than are doing about it. I think we also have to consider everything that’s happened in the public cloud in this same vein and whether it’s turning CapEx into OPEX or even keeping up with a level of change or redeploying resources. A lot of the end customers that we research, they want to hear more about this. So you talked a little bit about the customer benefit, but I wanted to pivot this around to the benefits to your partners. How do partners benefit from Network as a service in what you’re announcing today?
Phil Mottram: Sure. Yeah. I mean, as I say, partners are absolutely critical to the way that we go to market at a HPE level and also within the Aruba business. What we’re helping partners do here is we’re recognizing the fact that the market is changing. So customers want to buy in this new model. And then what we’re doing is we’re providing our partners with a platform to be able to offer not only the core Aruba service but also layer on their additional services and then take those out to the market. So we know, for example, when customers look at network solutions, some of it is around making decisions around, okay, the network, infrastructure itself, but also the management platform as well, which is increasingly more important. But then over and above that, you need to be working with a partner that can deploy the network equipment in a timely manner, make sure that they’ve got the network spread out, so you get optimal coverage across your office locations, et cetera, et cetera. So what we do is we provide the base offer and that commercial platform and the management platform as well to our partners. And then we offer them the ability to be able to layer additional services on top of that. So we make sure that both Aruba and the partner are relevant to the customer and the fact that the market’s changing.
Daniel Newman: Yeah, I think it’s a really important thing to actually be considerate as leaders in your spaces, respectively, as Aruba and as HPE Green, to be partner focused, if that’s the way your organization wants to go to market. For a long time, we’ve looked at the distribution models, we’ve looked at the channel models, and the partner models. And we said, “It’s going to be hard. It’s going to be hard for them to make this transformation.” Many of them became extremely successful and comfortable on selling large CapEx volumes, sometimes very low margin but at scale, and partners were an enabler of volume. And now we’re seeing this pivot to high-quality, high-value consumption-based services, and it’s been a big change. So when companies, like HPE, bring this to the partner, make it very accessible, it’s part of that shift.
And I think we’ve been studying this and researching this for a decade and going, “Are the partners going to be able to make this change?” And so clearly, you guys are saying, “We want to make it simple. We want to make it digestible. We want to make it easy. And then, of course, you can put your value on top of it to figure out how you continue to differentiate yourself.” So speaking about differentiate yourself, though, I’d love to hear that from you guys. We know the market, the competition, they’re all going to come out with things that are going to follow what you’re doing here. Some will follow. Some in the public cloud are already doing iterations of what you’re doing here. What’s the HPE Green Lake differentiator here with your Aruba solutions?
Phil Mottram: Yeah. I mean, look, it’s pretty simple. Lots of our competitors talk about their offerings and what have you, but no one has the ability to provide the Green Lake platform from edge to cloud. So that’s what makes HP very, very different, the fact that we can provide, as a service, offers in the compute, storage, data, and connectivity space. And I think we’re the only company in the market that can actually do that. So that’s where we’re different is, we give both customers and partners the capability to be able to deploy these services from one single platform. So that’s a real standout difference.
And then I guess, linked to that is we use a common platform for all of the network connectivity products. So when you look at our competitors, because they’ve built their businesses through acquisition, for the most part, they have a different management platform associated with a different network product. That’s where we’re very different. We use the Aruba Central platform to link all of our products and services and provide customers with a really, really easy way to manage their networks. And I think the reason that’s becoming more important is when we talk to customers and say, “Okay, what’s one of your big challenges when you’re looking at networks?” One of the big challenges, they spent too much time managing the network platform that they’re built out today and not enough time being able to think about the future.
And what the Aruba Central platform does is it allows customers to spend more time thinking about the future because the platform itself has a lot of intelligence built into it that proactively manages the network. So that’s how we’re helping customers and partners get the benefits of the as a service offers and, as I say, where we stand out as a company is we’re able to do that from edge to cloud.
Daniel Newman: Well, Phil, I want to thank you so much for taking the time here with us. We are a curious bunch. As analysts, we always want to know what you’re thinking. And of course, we want to hear from the source how you’re differentiating, and then we’re going to assess the markets, we’re going to look at everything as a whole, and we’re going to… Of course, we’re going to come to our conclusions. So far, what you’ve accomplished, what Green Lake has accomplished, has been in impressive, the data, the growth. I’ve said many times, in many of my market-facing pieces, watch that Green Lake growth number. That’s the number that’s really going to be clearly articulating whether HPE is executing to its plan. So we’ll be watching closely this particular set of offerings and how quickly they grow. But we were really glad to have you here to join us for this Six Five On The Road here at HQ, in Houston, beautiful headquarters. Hope next time you’ll be sitting right across from us, but thanks for jumping in and joining us all the way from across the pond.
Phil Mottram: Hey, it was absolutely my pleasure. Always good to speak to you guys. And it’s interesting, isn’t it, on the growth side of it. You should also mention the fact that we’re the only company that actually produced results and track the growth publicly. So that’s evidence to the momentum that we’re seeing, but great to talk to you guys, and look forward to speaking to you again soon.
Patrick Moorhead: Thanks.
Daniel Newman: Thanks, Phil.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. Read Full Bio