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A Violin Memory Pricing Structure for VARs

November 23, 2017

A Violin Memory Pricing Structure for VARs

Violin Memory is a leading maker of all-flash storage arrays (AFAs), which continue to increase in popularity. The speedier response times of these AFAs compared to traditional hard disk drives offer a key selling point, with solid-state devices providing significant benefits to customers who need low latency for their critical applications.

According to Wikibon, flash is now the most cost-effective storage for applications that need high levels of performance. Even when the raw cost of AFAs is higher than the raw cost for traditional disk storage, the cost per usable terabyte is lower when measures such as data reduction and de-duplication are included in the assessment. Wikibon also predicts that flash prices will drop 30 percent per year, compared to disk drive prices dropping 20 percent.

Disks are Dead?

Wikibon's founder, David Floyer, told TechTarget, "For active data, the disk drive in 2015 is fundamentally dead." Wikibon predicts flash will be lower in cost than disk in 2016. Not everyone agrees; TechTarget got a contradictory opinion from Jay Kidd of Netapp, who said, "We foresee the gap in cost between the least expensive flash and the least expensive hard drive staying at about a 10-times difference in cost through the end of the decade."

As a maker of flash memory, it's not surprising that Violin is more optimistic about the competitiveness of flash. The company's own prediction is that flash prices will be equivalent to hard drive dollars-per-terabyte costs in 2017. Companies that aren't persuaded by cost or dollar figures may be convinced to use flash arrays based on simpler management. Upcoming denser AFAs mean equivalent capacity will eliminate multiple racks in the data center, along with associated maintenance.

Violin Memory Pricing

IDC reported the cost of hard disk drives at about $0.80/GB, compared to AFAs at around $5/GB, with some AFA vendors under that mark and some above it. Violin's cost is highly competitive, at about $1.50/GB given a 6:1 data reduction.

For Violin's Windows Flash Array products, the product is extendable, providing the ability to add memory as needed without paying a large up-front cost. Memory capacity can be expanded in increments of 8.8TB. This is a software-based expansion that means no disruption from installing additional memory. The flexibility of this option should enable Violin's value-added resellers (VARs) to target not just the large enterprises that require and can afford a large initial expenditure, but also smaller enterprises and mid-sized businesses that want to manage cash outlays more cautiously. The 7300E model offers an 11TB (raw) starting point, upgradeable to a max size of 35TB raw. The 7300 array with a 17.5TB starting configuration has a list price of $265,000.

Another consideration when pricing Violin Memory (or any AFA product) is that typically backup software and other data services requirements are bundled into the purchase price of the array. Because the array has built-in OS, firmware, software, and hardware, customers gain additional savings from not having to purchase licenses in order to snapshot, replicate, or otherwise support their data. The selling point for VARs is the reduced management and optimization effort required. Violin's lifetime endurance guarantee also enhances the potential cost benefits to customers who choose a Violin Memory product.

Violin Memory Partner Program

Along with pricing properly, finding the right partners is key to success in selling big data products and services. VARs that want to enhance their revenue from selling Violin Memory products could consider signing up for the Violin Global Partner Program. The program offers incentives and support in order to help vendors sell Violin Memory arrays. There are increased margins on deal registration through discounts on the list price plus incentives on new accounts.

Violin Memory sells discounted demo units to partners. The partners set their own end-user prices, and the income opportunities aren't limited to sales, but also include services and training. Because memory costs are continuously decreasing, the company anticipates that VAR partners will make up the difference through these additional services, whereas margins don't undergo the same steady reduction.