The exponential growth of unstructured information within the enterprise is not only driving demand for storage capacity but also putting increased pressure on IT organizations to make more out of their infrastructure, a  challenge that Tom Cook, the CEO of deduplication specialist Permabit, says is shifting the competitive focus to software.  He stopped by theCUBE during IBM’s recently concluded Edge conference to share his insider’s perspective on the growing importance of data efficiency in the marketplace.

When it comes to primary storage, meaning hardware housing information that is actively accessed by users, there are three main approaches to optimizing utilization. Two of them – compression and deduplication – involve reducing the size of files to conserve space, while the third, thin provisioning, is a method in which capacity is provisioning as needed rather than in advance. That eliminates redundancies and makes it easier to scale virtual environments.

The role of software as a differentiator in the storage industry is evident by the success of emerging players like hyperconvergence startup Nutanix and all-flash array maker Pure Storage, Cook tells hosts John Furrier and Dave Vellante, pointing to the fact that both have built a wealth of advanced capabilities into their respective offerings. He groups the two firms with Amazon, noting that while they operate in different markets, they share a common focus on driving operational efficiencies.

“Underneath it all, those categories don’t really matter as much as data efficiency does because they’re all playing the data efficiency,” he says. ”The reason Nutanix and Pure are winning is because they’re bringing data efficiency to the solution and it’s waking up the incumbents, so we’re seeing a real drive of adopting technology in this area.”

Obstacles in market gains

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Pure in particular is making big gains against traditional storage vendors, but Cook observes that the company has an Achilles’ heel that greatly diminishes its ability to compete.  Specifically, the performance of its arrays degrades with use, an issue that he says is becoming increasingly unacceptable. The competition is already pouncing, with EMC recently announcing that it will award one million dollars to the first customer who can “break” the inline storage optimization capabilities of its all-flash XtremIO system.

Another problem with Pure’s products, according to Cook, is that they wait for data to be written to storage before carrying out the optimization process. That results in a significant latency increase that inline technologies like those offered by EMC and Permabit avoid entirely.

• Uninhibited growth

Despite these flaws, however, Pure continues to outgrow the rest of the industry with no signs of slowing thanks to what Cook sees as a winning combination of features that provides both flexibility and efficiency.  “IBM, EMC, HDS; they all have a lot of flash in their primary, so they can compete very effectively in terms of performance. But it’s about price parity with performance and that’s what Pure is exploiting,” he explains.

Pure’s momentum is reflected in its $3 billion valuation, which Cook notes is eight to ten times higher than that of players like Violin Memory that don’t presently offer storage optimization capabilities of the same caliber. All this has not gone unnoticed by the industry’s old guard,  many of whom are now doubling on flash in a bid to reinforce their grip on the high-end  storage market that the firm is targeting with its arrays. “We’re gonna see the high-end arrays move into hybrid and more flash over time,” he predicts. “They’ll be very effective.”

Permabit, for its part, is happy to see the growing emphasis on data efficiency. The company is positioning itself as something of an arms dealer to the storage industry, making the capabilities that catapulted Pure into prominence available across a wide range of systems. Its software is currently shipping in more than 1,500 arrays per quarter, Cook details,  saving end-customers between $2.5 and $3 billion in hardware costs each year.

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