Veeam CTO Danny Allan: We’re All-In On Cloud

The VeeamON conference this week is highlighting how far Veeam is moving to embrace the cloud, Kubernetes, and other leading-edge technologies to better protect and manage data, with demonstrations of upcoming technologies around AWS, Azure, Google, Red Hat, and its recently acquired Kasten Kubernetes storage management platform.

Veeam this week is holding its annual VeeamON conference, its second in a row in a digital format because of COVID-19 travel restrictions. Danny Allan, chief technology officer of the Baar, Switzerland-based developer of data protection and management software, told CRN that VeeamON gave Veeam the opportunity to introduce a wide range of technologies to be released later this year for protecting and managing data across on-premises and cloud environments, including new versions of Veeam Backup for Office 365, Amazon Web Services, and Red Hat.

More importantly, Veeam is bringing out new integrations with its Kasten Kubernetes technology aimed at giving the company the high ground when it comes to containerized storage across on-premises and cloud environments, Allan said. Veeam is making sure partners know that Veeam, with Kasten, is taking an application-centric, not a storage-centric, approach to Kubernetes.

“When you’re talking to a Kubernetes administrator, they don’t want to deploy out of the Amazon marketplace, the Azure marketplace, or Google,” he said. “They want to deploy a Kubernetes software platform in Kubernetes to protect Kubernetes. So one of the differentiating factors of our platform is, it’s designed for Kubernetes on Kubernetes, and it’s very application-aware.”

Allan also called Veeam’s financial situation “fantastic,” and shared both surprising and unsurprising results from the company’s recent data protection survey of 3,000 organizations.

To read the conversation, click through our slideshow.

CRN: So what’s going on at VeeamON this week?

Allan: Lots of exciting stuff. As you know, VeeamON is always associated with announcements and sneak peeks of products that are coming, but I would say really, we‘re focusing on three different areas. One is celebrate how far we’ve come this year [financially]. So there’s a bit of celebration around financial and product deliveries. Second thing is, we’re doing sneak peeks at products coming out in the second half of 2021. Notably there’ll be some demonstrations of Veeam Backup for Office 365 version 6. There’ll be demos of Veeam Backup for AWS version 4. The Kasten K10 Kubernetes integration with the VBR (Veeam Backup & Recovery) platform. So lots of demos. And then introducing Veeam Backup for Red Hat Virtualization and other KVM variants to the portfolio.

CRN: Let’s just go through these one by one. First of all, on the financial front, how has Veeam been doing?

Allan: Fantastic. Last year we did 22 percent year-over-year growth. At the end of Q1, we announced 25 percent year-over-year growth in our annual recurring revenue. We‘re switching to this subscription and recurring revenue model. So very, very strong growth. And the exciting thing about that is, it was in the products that are directionally aligned with where we want to go, Office 365 being one of those. We saw 156-percent year-over-year growth in that product. And we actually announced 5.8 million paid users. Microsoft has said there’s 145 million [paid users]. So I look at that and say, ’Hey, lots of room to grow.’ Huge growth, obviously, in Office 365. On the cloud front, we’re talking about the massive adoption of cloud. And in Q1 of this year, we moved 100 petabytes into the public cloud in just a single quarter.

CRN: What is Veeam’s annual recurring revenue?
Allan: We can’t share with the actual ARR is.

CRN: Is it a significant portion of your revenue?
Allan: Oh yes. Very, very significant portion of our revenue.

CRN: The second thing you talked about was some of the changes on the backup of SaaS applications like Office 365 and so on. What’s new?

Allan: The big announcement and the demonstration at VeeamON is around end user self-service recovery. So you yourself can log in and recover files from OneDrive or emails from Exchange, or sites from SharePoint, if your administrator enables that capability. But it‘s a self-service portal. So it’s just a continued cadence of giving more features to the market

CRN: And when will that be available?
Allan: We‘re not announcing an exact date. It’ll be in the second half of 2021.

CRN: You also mentioned some new integrations with Veeam’s Kasten Kubernetes service. So what’s going on?
Allan: We acquired Kasten last year. They were already protecting OpenShift on-prem, but also EKS [Amazon Elastic Kubernetes Service], GKE [Google Kubernetes Engine], AKS [Azure Kubernetes Service], all the major clouds. We‘ve seen significant traction since we acquired them about six months ago in the enterprise data space as a stand-alone product. And we’re demonstrating the integration with the Veeam platform. And this takes advantage of we call Veeam Platform Services, but it’s the same framework that we use for Veeam Backup for AWS, for Azure, for GCP, for Nutanix. So it‘s a common framework for bi-directional communication between a stand-alone product and the core platform.
CRN: Is this the first move by Veeam to actually integrate Kasten technology into the other parts of the Veeam portfolio?
Allan: We started the efforts of the technical integration about a year ago now. So this is the first step in the technical integration. Now, as you might imagine on the business side, there‘s been lots of business integrations happening with sales and marketing and R&D and all of that. But this is the first step of technical integration, and probably unsurprisingly for you, we’ll continue to invest in those integrations as we move forward. And that does depend on customer feedback. Customers will ask for certain things and we’ll continue to invest based on the customer feedback.

CRN: What’s been the partner uptake of Kasten given that Kubernetes for many of them is probably still fairly new.
Allan: It’s interesting that you ask that. Kubernetes is, I’ll say, is evolving or emerging in the enterprise space, so very large organizations and telcos. There’s very low penetration in the SMB and commercial markets. What I have been telling people is, we have three engines on maximum thrust right now for Veeam. If you ask why we have 25-percent year-over-year growth, it’s protecting the data, protecting SaaS and Office 365, and protecting the cloud. Kubernetes is an emerging product for us. It’s not driving the same amount of revenue as those other three. However, it’s probably the most strategic for our future. Right now, the uptake is primarily in the enterprise, but we’re seeing it come down now into the commercial space as well. And we’re actually ahead of our projections. Prior to the acquisition of Kasten, we had projected what that would look like, and it’s actually being adopted even faster than we had guessed or built our models off of.
CRN: How about in the partner community?
Allan: It depends on the partner. So those partners that are focused on the enterprise segments and have those relationships, it‘s going very well. Those that are focused on the lower end, it’s slower adoption there. However, within two to three years, I expect it to span the breadth of the partner community.

CRN: How does what Veeam is doing with Kasten differ from say what Pure Storage is doing with Portworx or NetApp with Project Astra and some of the other moves by the storage vendors to get into Kubernetes?

Allan: If you look at the analyst reports on what are the best products for protecting Kubernetes, you‘ll see that Veeam is a clear leader in this space. How we differentiate from everyone else, there’s two things. One is Kasten itself. The K10 platform is a Kubernetes platform. When you’re talking to a Kubernetes administrator, they don’t want to deploy out of the Amazon marketplace, the Azure marketplace, or Google. They want to deploy a Kubernetes software platform in Kubernetes to protect Kubernetes. So one of the differentiating factors of our platform is, it’s designed for Kubernetes on Kubernetes, and it’s very application-aware. So think about the types of storage in Kubernetes. You have structured data, unstructured data, object storage, message queue. So because it’s designed for that world, it understands all the types of persistent storage.

The other way that it‘s very different: If you look at Portworx, for example, with Pure Storage, they fundamentally approach it from a storage perspective, as opposed to an application perspective. And we’ve always been focused on the application because when you go to recovery, it’s not about recovering storage, it’s about bringing the service, the application, itself back online, and that is a different way of looking at the problem. And it is unique to Veeam. The good thing I’ll say about Kasten is, they’ve always had that application-centric view that is very different than all the other competitors, but very much aligned with Veeam.

CRN: You also mentioned new integrations of Veeam with Red Hat. What‘s going on there?

Allan: [We previously] brought out Veeam backup for Nutanix AHV, its Acropolis hypervisor, which is a KVM variant. Now generally available at 2.1 of that product, it‘s been going very well within the Nutanix partner ecosystem. The reason I start with that is, AHV is based on KVM. We have some customers who are not using the Nutanix version of KVM. They’re using the Red Hat version. And so they said, ’Hey, can you bring us the same solution?’ And so we did. We took the solution that protects the Acropolis hypervisor and we built it for Red Hat Virtualization. So while it is a version 1 product, the ability to protect Red Hat Virtualization is really built on our learnings with AHV and the partnership with Red Hat. So for the past year, we’ve been working on introducing change block tracking into the kernel, and we’re taking advantage of that change block tracking in our data protection capability.

CRN: So the Linux kernel change block tracking was developed with specifically with Veeam?

Allan: Specifically with Veeam, and we‘ve been going back and forth. It’s actually one of the reasons why I say it’s coming up this summer as opposed to already here, because we’ve been helping them solve some of the issues in those kernel drivers. [It’s in] RHEL (Red Hat Enterprise Linux) 8.3 and, and RHV (Red Hat Virtualization) 4.6, but it’s basically solving some of those things specifically related to change block tracking so that it can scale to the size of our customers.

CRN: Talk about the growth in the partner community over the last year and some things that you‘re looking to do for them this year?

Allan: As you know, we‘re 100 percent channel in our model. What we’re doing with the channel community is, we’re growing the business. There’s two things happening simultaneously in the channel. One is changing the unit of measure away from sockets to instances. Why is that valuable for the partner community? We call this the Veeam Universal License. That is important for the channel community, because as customers move their workloads to the cloud, there are no sockets. It’s all instance-based. And this allows them to be relevant in a cloud world where their customers are moving to cloud-based services so they can help them in that cloud journey.
The second part is not just changing the unit of measure, but also changing the go-to market. So while historically we‘ve been perpetual, we’ve been pushing more subscription. That’s not a requirement, by the way. They can still do perpetual even with full universal licensing. But it enables them to have a recurring revenue model and an on-going relationship with their customers that drives value to them. So as our customers go through this transformation, partners can keep the dialogue open and be very relevant in the cloud adoption model.

CRN: Veeam last year was acquired and was talking a lot about making a big push into data management. What has Veeam has done in the last year about it?

Allan: So we talked a lot about cloud data management, and in 2020 alone we moved 242 petabytes from on-premises into our top three cloud partners. That‘s just one year, and just our top three cloud providers. I think that is bigger than anyone else in the market. I feel very confident in saying that. And actually in Q1 of 2021, we moved 100 petabytes. So when we talk about data management, it’s not just about doing backups. It’s about managing the data between on-premises into the public clouds, into object storage, but also even beyond that. One of the interesting capabilities that we added in Veeam Availability Suite version 11 earlier this year was the ability to tier it into the coldest tiers of storage, S3 Glacier and Azure Archive Tier, which is 20 times cheaper. And at VeeamOn we’re adding it to our three cloud products, Veeam Backup for AWS version 4, Azure version 3, GCP version 2, all of which are coming up in the next few months. All three of those will be supporting archive tiers.

Why do I highlight that? Because this is data management. It‘s not just doing backup, but it’s managing it across different tiers. Why do customers want this data management? It helps them reduce their costs in a very complex world. How much do I keep here? How much do I keep there? What are the benefits of moving the data? If you move it into cloud, of course you can do machine learning and crack it open and do things with it. So we’ve been pushing that forward very aggressively, and in every product release we add more data management capabilities.