Cloudera Analyst Day 2016: New Strategies for a Mainstream Hadoop World

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Earlier this week I spent a couple of days at Cloudera’s 3rd annual Analyst Day. The team put together a strong program and it was great to get such a condensed update on the company’s progress and strategy.

Strategy

Speaking of strategy, we spent a lot of time on company strategy at the event and covered several different views into their strategy, i.e. company, product, go to market, partner, etc. perspectives. A couple of highlights here:

Open Source. The company emphasized its commitment to open source through its hybrid (ie open-core) business model. This has been a point that the competition, namely Hortonworks, has hit them on, but they seemed to have learned how to tell this story and back it up with evidence of community contributions and commitment.

Business Value. Cloudera believes that Hadoop is now mainstream, meaning their target market of Global 8,000 enterprises are moving beyond Hadoop science experiments and are ready to have business-level discussions about the transformative opportunity around big data. They’re focusing their efforts on three “board-level” value drivers: customer 360, product/service delivery, and risk.

Land & Expand. The companies go-to-market approach is based on getting a foot in the door with smaller opportunities (including the aforementioned science experiments, typically under USD100K), and expanding from there. They shared a fair amount of detail under NDA suggesting that this strategy is working very well.

Product Packaging. Consistent with their belief in a mainstream Hadoop market, the company has plans to shift the way it talks about and sells its product. Unfortunately specifics can’t be shared here but will be made public soon.

Intel Partnership

It’s been almost two-years to the day since Cloudera announced Intel’s USD740M investment in the company. The company presented a number of data points suggesting that they “partnership” aspect of the investment is more than empty talk. The company now has extensive visibility into what’s coming down the pike in hardware, and has oriented its R&D; roadmap around those advances that will provide impact. Examples include the work in hardware-based encryption acceleration (present), support for Intel’s 3D XPoint tech (future, see below), pushing machine learning functions from Spark into silicon (future). In addition, the two are collaborating on some interesting projects in the cybersecurity space which will be announced soon.

Industry Insight

Also supporting Cloudera’s desire to elevate customer conversations is their investment in an internal team of vertical subject matter experts: Health and life sciences, telecom, retail, manufacturing, financial services and insurance were represented on a panel that was held; the discussion was generally very insightful.

Cloud

The company launched Cloudera Director a couple of years back (my coverage here), and while it was a positive step at the time, the product had seemed to languish a bit… until now. Cloudera is doubling down on the cloud. In the past 18 months, the company says, they”’ve seen growing enterprise acceptance of the public cloud, to the point that 15% of deployments are now cloud based.

With Cloudera Director as a starting place, which it will reinvigorate its investment in, the company is stepping back and tacking stock of the entire platform and how it needs to evolve to fully take advantage of cloud deployment.

Cybersecurity

The company sees a large opportunity in cybersecurity and has been, and will be investing in that area. Cyber threats, data loss, etc. represent such a huge risk to C-suite executives, helping them combat these risks has proven to make the checkbooks fly open (in the words of a partner).

Notably, Cloudera is not doing the domain-specific heavy lifting by themselves—Intel, Accenture, and other partners are playing a large role in this.

Data Science

The company hopes to make it easier for data scientists (i.e. non-Java developers using languages like Python and R) to use the platform. Watch this space for more!

Update 24 Mar 2016: That was quick! Sense announces their acquisition by Cloudera.

Summary

Cloudera is very well positioned moving forward. They’re seeing strong results/metrics in the core business, are funded through to cash-flow breakeven, and have solid/productive partnerships in place. Even if they’re a bit ahead of the market in declaring Hadoop “mainstream,” what they’ve done with that–build out the industry team, tighten up the product definition, start to shore up the cloud story, and launch forays into a first application area–all bode well for the company.

If anything, the risk they face is having too many strategies. I suggested this to one company executive and he volunteered that the company does seem to have a “three-dimensional” strategy at times. The risk here is complexity, confusion in the ranks–especially the field–and faltering execution.

If they can simplify the strategy a bit and drive coherent execution I’m sure we’ll be seeing even better metrics this time next year.

 

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