NetApp, formerly Network Appliance Inc., is a company in the computer technologies industry specializing in data storage hardware and associated management software. NetApp storage equipment is used by enterprises and service providers to store and to share large amounts of digital data across physical and hybrid cloud environments.

The NetApp storage hardware includes all-flash and hybrid storage systems for block, file and object storage. NetApp storage systems integrate with major public cloud service providers and natively support VMware vSphere for virtualized workloads.

NetApp, which celebrated its 25th anniversary in 2017, is publicly traded and ranks 468th on the Fortune 500. The company first incorporated in April 1992 in Santa Clara, Calif. In 2001, NetApp reincorporated in Delaware and relocated its headquarters to a 58-acre campus in Sunnyvale, Calif.

Analyst firm IDC ranked NetApp third in external storage revenue through November 2017, up 6% to nearly $701 billion year over year. That placed it ahead of IBM, trailing market leader Hewlett Packard Enterprise (HPE) and No. 2-ranked Dell Inc.

NetApp company history

Founders Dave Hitz, James Lau and Michael Malcolm started Network Appliance in 1992. The three were professional colleagues at now-defunct Auspex Systems, an early Network Appliance competitor.

The first Network Appliance product was a file server appliance -- known generically now as NetApp filers -- to eliminate the overhead traditionally associated with competing storage products. Network Appliance brought the product to market in 1994, aided by nearly $13 million in venture funding, led by Sequoia Capital. The product's design foreshadowed the concept of disaggregation: a storage filer was connected to, yet independent of, a nonprogrammable compute server.

Initially, NetApp marketed its filers to Unix-based technical workgroups writing client-server programming software for the Network File System (NFS). The technology proved to be a steppingstone to NetApp's emergence as an innovator of network-attached storage (NAS) systems.

Malcolm was NetApp's first president and CEO, but was forced out in 1994 by investors preparing to take the company public. Daniel Warmenhoven replaced Malcolm and led NetApp to its initial public offering (IPO) of stock in November 1995. The stock sale raised nearly $26 million, "just in the nick of time, because we were out of money," Hitz wrote in his history of NetApp, titled "How to Castrate a Bull: Unexpected Lessons in Risk, Growth and Success in Business."

By the mid-1990s, NetApp generated most of its revenue from the sale of network filers and cache appliances. By then, the market had started to evolve beyond the Unix and NT workstations that had been the core of NetApp's early growth. NetApp shifted gears to ride the Internet wave, selling storage products to high-tech and internet-based companies. Revenues grew from roughly $250 million to more than $1 million between 1999 and 2001.

Roughly 70% of NetApp sales came from internet-based firms during that time. The price for NetApp stock soared to $150 per share at its high point, but the dot-com bubble wiped out almost all the gains. By 2001, NetApp revenues fell to $800 million. Share prices dropped to approximately $6, forcing NetApp to enact its first round of layoffs.

Following the collapse, NetApp switched to target large enterprise customers across vertical markets, including automotive, banking and financial services, energy, government, healthcare and manufacturing. Specifically, NetApp aimed its NAS line at organizations that used it to complement, and in some cases replace, traditional Fibre Channel (FC)-based storage area networks (SANs).

NetApp started selling block-storage SANs in 2002, supporting FC and Ethernet-based iSCSI connectivity. The move into SANs intensified NetApp's competition against rival EMC, which trailed NetApp in NAS market share at the time but still led the SAN market. EMC and NetApp were the largest pure-play storage companies, while other competitors such as IBM and Hewlett-Packard sold servers and storage.

In 2009, Warmenhoven turned over the CEO reins to Tom Georgens. However, Warmenhoven continued as NetApp's chairman until 2014.

Prior to taking over the top spot, Georgens served as NetApp chief operating officer. During Georgens' tenure, NetApp revenues peaked at $6.3 billion in 2014, but the vendor fell behind other legacy storage vendors in bringing all-flash, cloud and hyper-converged products systems to market.

NetApp fired Georgens in 2015 after a string of disappointing quarters, marked by flat earnings and sluggish customer upgrades from OnTap-7 Mode to clustered OnTap. George Kurian took over as CEO after serving in several executive roles at NetApp, including most recently as its executive vice president of product development.

NetApp became the largest predominantly storage company after Dell acquired EMC for more than $60 billion in September 2016.

In February 2018, NetApp reported quarterly revenue of $1.52 billion. The results included sales of SolidFire all-flash arrays acquired in 2015. Cloud and flash storage sales accounted for about 70% of product revenue in 2017.

Department of Justice probe involving trade sanctions

In 2011, The Washington Post reported that NetApp was suspected of violating U.S. trade sanctions by selling storage equipment to the government of Syria, which had been designated a state sponsor of terrorism. NetApp's gear reportedly surfaced in a surveillance network designed to scoop up email and other communications of rebels opposed to the government of Syrian President Bashar Hafaz el-Assad.

NetApp was one of several companies ensnared in the probe, which also included HPE. The storage gear purportedly was sold originally by NetApp's Italian subsidiary to an authorized vendor, who subsequently resold it to Area SpA, a Milan, Italy company that develops systems to monitor and intercept digital data communications.

In 2014, the U.S. Department of Justice concluded after a lengthy probe that NetApp was cleared of any wrongdoing.

Major products, features and use cases

The vendor's flagship product line is the branded Fabric-Attached Storage (FAS) array, available in all-flash and hybrid configurations. Multiprotocol FAS arrays support block storage with FC, FC over Ethernet and iSCSI, with file support for CIFS, NFS and SMB protocols.

FAS arrays run the NetApp OnTap operating system software (formerly known as Data OnTap). NetApp FAS provides shared NAS and SAN storage, as well as serving as a data store for NetApp FlexPod and Nflex Converged Infrastructure products.

NetApp FlexPod combines FAS storage with Cisco Unified Computing System servers and Cisco Nexus fabric switches. Nflex bundles All-Flash FAS (AFF) or hybrid arrays with Fujitsu Primergy CX400 M4 x86 scale-out servers, with network switches by vendor Extreme Networks.

NetApp's OnTap software, also known as clustered OnTap, provides automated data placement, cloning, data tiering, flexible volume RAID groups, inline data reduction, hybrid caching, metro clustering, quality of service, and triple-parity RAID 6 data protection.

OnTap SnapCenter and SnapManager uses array-based snapshots with asynchronous replication to any NetApp storage, including mirrors, rapid restores, space-efficient vaulting and volume encryption. The NetApp OnCommand System Manager GUI provides simplified device-level management for configuring and provisioning of OnTap-based storage.

NetApp OnTap Select is a software-only version that can run on a customer's choice of server hardware. OnTap Cloud allows customers to choose Amazon Web Services (AWS), IBM Cloud or Microsoft Azure as a FAS target for private or hybrid cloud storage.

Engenio, AltaVault and SolidFire acquisitions

The NetApp primary storage portfolio has grown through several acquisitions completed in recent years.

In 2015, NetApp paid a reported $870 million to acquire the assets of all-flash array vendor SolidFire. The transaction occurred after NetApp's fitful development of its branded FlashRay all-flash system, which was available only as a single node. The FlashRay product was scrapped following the SolidFire merger.

NetApp SolidFire storage arrays are powered by the Element OS operating system, a core feature of which is its ActiveIQ predictive cloud-based analytics for diagnosing data and system hygiene. SolidFire arrays provide the storage component in NetApp HCI, a hyper-converged product introduced in 2017.

NetApp HCI
NetApp's HCI hyper-converged storage product is designed around SolidFire all-flash storage.

In May 2011, NetApp paid $480 million to acquire the Engenio block storage systems from LSI Corp., later part of Avago Technologies. Avago subsequently was bought in 2015 by Broadcom Technologies, which itself was acquired and is now part of Broadcom Limited. NetApp rebranded Engenio as its E-Series hybrid flash system. E-Series storage is powered by the SANtricity operating system and provides an entry-level hybrid system for distributed DevOps environments to build big data, cloud, mobile and social applications.

SANtricity includes point-in-time snapshots and an SSD cache for hot reads, automated data placement between storage tiers, and tools for managing Hadoop-based big data lifecycles. The SANtricity snapshots are copies of a local storage volume. Secondary servers can access a suspended writable copy for backup, data mining, file restores and testing.

OnTap software upgrades in recent years have integrated cross-platform replication between SANtricity and SolidFire Element.

NetApp StorageGrid Webscale object storage is based on technology gained by a 2010 acquisition of Canadian vendor Bycast. Version 11 of NetApp StorageGrid allows customers to mirror on-premises unstructured data to an Amazon cloud instance.

For secondary storage, NetApp picked up the SteelStore line of cloud backup appliances from Riverbed Technologies in 2014, rebranding the product as NetApp AltaVault. Customers can buy AltaVault as a physical product on FAS arrays, as a virtual storage appliance for Microsoft Hyper-V or VMware ESX, or as an appliance in AWS or Microsoft Azure public clouds.

The SteelStore acquisition gave NetApp a purpose-built backup appliance after it lost a bidding war to archrival EMC to acquire deduplication appliance specialist Data Domain in 2009.

In 2017, NetApp acquired startup Plexistor, announcing plans to integrate its storage-class memory software as a fast, low-latency tier in OnTap and Element OSes.

Recent news includes focus on hybrid cloud Data Fabric

Also in 2017, NetApp acquired Iceland-based Greenqloud, with plans to integrate the cloud management software as part of NetApp Data Fabric technologies. NetApp Data Fabric, introduced in 2015, gives customers a method to seamlessly manage applications and associated data across any NetApp storage locally and in multiple hybrid clouds.

Data Fabric storage-as-a-service subscriptions include Cloud Sync and NetApp Cloud Control for Microsoft Office 365. Cloud Sync is a synchronization engine that transfers data between local NFS storage and the AWS Simple Storage Service (S3), aimed at enterprises crunching big data for real-time analytics.

Customers use Cloud Control for Microsoft Office 365 backup to protect application data in Microsoft Exchange, SharePoint and OneDrive using AWS S3 or Microsoft Azure.

NetApp Private Storage (NPS) for Cloud is a scalable service that lets customers burst into the public cloud during peak computing demand, while retaining local control of data. NPS is designed to use AWS, IBM Cloud or Microsoft Azure as cloud targets for FAS storage hosted in colocation data centers.

This was last updated in April 2018

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