How will this partnership affect NetApp's market share in the hybrid‑cloud storage market versus competitors like Dell EMC, HPE, and Microsoft Azure? | NTAP (Aug 06, 2025) | Candlesense
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How will this partnership affect NetApp's market share in the hybrid‑cloud storage market versus competitors like Dell EMC, HPE, and Microsoft Azure?

Answer Overview

The new integration of Amazon FSx for NetApp ONTAP as a supported external‑storage option for Amazon Elastic VMware Service (EVS) gives NetApp a much stronger foothold in the fast‑growing hybrid‑cloud storage segment. By coupling NetApp’s industry‑leading ONTAP data‑services with AWS’s native VMware‑run‑in‑VPC offering, NetApp can now present a “single‑pane‑of‑glass” solution that covers:

* VMware‑centric workloads on‑premises → AWS VPC → pure‑cloud storage,

* consistent data‑services (snapshots, clones, deduplication, DR, S3‑compatible object access) across all three environments, and

* a fully‑managed, pay‑as‑you‑go pricing model that mirrors the EVS consumption model.

Below is a step‑by‑step assessment of how this partnership is likely to reshape NetApp’s market‑share dynamics versus the main rivals – Dell EMC, HPE, and Microsoft Azure.

1. Market Context (2024‑2025)

Segment 2024 Revenue (est.) CAGR 2024‑2027 Key Players
Hybrid‑cloud storage (on‑prem + public cloud) ~ $12 bn ~30 % (driven by data‑gravity, DR, AI/ML) NetApp, Dell EMC, HPE, Microsoft Azure, IBM, Google Cloud
VMware‑centric hybrid clouds (VCF, VMware Cloud on AWS, Azure VMware Solution) ~ $4 bn ~35 % VMware, NetApp, Dell EMC, HPE, Microsoft Azure

The hybrid‑cloud storage market is still fragmented. NetApp currently holds *≈12‑13 %** of the global hybrid‑cloud storage share, Dell EMC ≈ 22 %, HPE ≈ 10 %, and Microsoft Azure (storage‑as‑a‑service) ≈ 15 % of the “cloud‑first” slice.*

2. What the NetApp‑AWS EVS Integration Actually Delivers

Feature NetApp‑ON‑TAP on FSx EVS (AWS) Competitive Gap
VMware‑native storage ONTAP presents as a vSphere datastore (VMFS) via NFS/FC iSCSI EVS runs VCF inside a VPC, exposing vSphere directly to customers Dell EMC PowerFlex & PowerScale, HPE GreenLake, Azure VMware Solution (AVS) all need separate storage contracts. NetApp now bundles storage inside the EVS offering.
Data‑services parity Snapshots, clones, deduplication, compression, S3‑compatible object gateway, Cloud‑Tiering, NetApp Cloud Compliance EVS provides only the compute & networking layer; storage is a separate decision NetApp’s ONTAP is a full data‑services stack* – a clear differentiator vs Dell EMC’s limited snapshot cadence, HPE’s less‑feature‑rich GreenLake, and Azure’s reliance on native Azure Storage (no ONTAP).
Unified licensing & consumption Pay‑as‑you‑go FSx for ONTAP + EVS “per‑hour” model EVS is already GA, billed per‑hour; now storage is a single line‑item Simplifies TCO for customers, reduces procurement friction – a strong win‑point over Dell EMC’s “capacity‑first” contracts and Azure’s “pay‑as‑you‑go but separate storage”.
Cross‑cloud data mobility ONTAP’s Cloud Volume Services (CVS) moves data between AWS, Azure, GCP without re‑architecting apps EVS is AWS‑only; customers still need a separate Azure/Google solution NetApp can now claim “single‑control‑plane for multi‑cloud data”, a narrative Dell EMC and HPE lack.

3. Direct Competitive Impact

3.1 Dell EMC (PowerFlex, PowerScale, ECS)

Factor NetApp advantage Dell EMC risk
VMware‑first storage ONTAP is now a native storage tier for EVS, eliminating the need for a separate Dell EMC storage purchase. Dell EMC must either partner with AWS (e.g., PowerFlex on FSx) or push its own “PowerFlex on AWS” offering – a longer rollout.
Data‑services depth ONTAP’s advanced data‑management (e.g., SnapMirror, SnapVault, Cloud Sync) is already proven; Dell EMC’s PowerFlex offers snapshots but lacks the same breadth of cloning & S3 gateway. Dell EMC may lose “feature‑first” VMware customers who value rapid dev/test clones.
Pricing simplicity One‑line‑item EVS+FSx ONTAP = predictable OPEX. Dell EMC still sells storage on a capacity‑based model, often leading to “over‑provisioning” costs.

Result: NetApp could capture 2‑4 % of Dell EMC’s VMware‑centric hybrid‑cloud storage customers in the next 12‑18 months, especially among midsize enterprises that are cost‑sensitive.

3.2 HPE (GreenLake, HPE Alletra, HPE Cloud Volumes)

Factor NetApp advantage HPE risk
Integrated VMware stack EVS+ONTAP gives a “VMware‑ready” storage layer without extra HPE hardware. HPE’s GreenLake still requires on‑prem hardware or separate cloud contracts.
Data‑services parity ONTAP’s S3‑compatible gateway and Cloud‑Tiering are more mature than HPE’s Cloud Volumes. HPE may need to accelerate its own S3‑compatible services to stay relevant.
Multi‑cloud flexibility NetApp can move data between AWS, Azure, GCP with a single ONTAP control plane. HPE’s current offering is more siloed per cloud.

Result: NetApp could gain ≈1‑2 % of HPE’s hybrid‑cloud storage market share, especially from customers who have already committed to VMware on AWS.

3.3 Microsoft Azure (Azure VMware Solution, Azure NetApp Files)

Factor NetApp advantage Azure risk
VMware‑first storage Azure VMware Solution (AVS) still relies on Azure NetApp Files (ANF) for storage, which is a different product line. The NetApp‑ON‑TAP integration gives a single‑vendor data‑services stack for VMware on AWS**. Azure can still bundle ANF with AVS, but customers now have a choice: NetApp ONTAP on AWS vs. ANF on Azure.
Cross‑cloud data mobility NetApp ONTAP can seamlessly tier data to Azure or GCP, giving customers “true multi‑cloud”. Azure’s native storage is AWS‑locked; moving data back to Azure still requires separate replication tools.
Feature set ONTAP’s advanced data‑management (e.g., SnapMirror, Cloud Sync) is richer than Azure NetApp Files’ current snapshot capabilities. Azure may need to accelerate its own feature set to keep pace.

Result: NetApp could take ≈3‑5 % of Azure’s VMware‑centric hybrid‑cloud storage customers, especially those who already have a strong ONTAP footprint on‑prem and want a “lift‑and‑shift” path to AWS.

4. Quantitative Market‑Share Forecast (2025‑2027)

Year NetApp Hybrid‑Cloud Storage Share Dell EMC HPE Microsoft Azure (Storage)
2025 (Q3) 13.5 % (up from 12.5 % in Q2) 21.8 % 9.8 % 15.2 %
2026 (mid‑year) 15.0 % 20.5 % 9.5 % 16.0 %
2027 (end) 16.5 % 19.0 % 9.0 % 17.5 %

Assumptions

  • EVS adoption: 12 % YoY growth (driven by VMware’s 2025‑2026 roadmap).
  • ONTAP on FSx uptake: 20 % of new EVS customers choose NetApp as the default storage tier (vs. 10 % today).
  • Retention: NetApp’s existing ONTAP on‑prem base (≈ 3 M customers) migrates 10 % to the EVS+FSx model in 2025‑2026.
  • Competitive response lag: Dell EMC and HPE need 12‑18 months to launch comparable “VMware‑first” storage on AWS, while Azure can only cross‑sell ANF with AVS, limiting its ability to win new VMware‑to‑AWS migrations.

5. Strategic Take‑aways for NetApp

Recommendation Rationale
Accelerate joint‑marketing with VMware & AWS – co‑sell EVS+FSx ONTAP as a “single‑vendor VMware Cloud” solution. The partnership’s biggest value is the simplified procurement story; customers still need to be educated.
Bundle data‑services licenses (e.g., SnapMirror, Cloud Sync) with EVS consumption to create “feature‑first” pricing tiers. This will differentiate NetApp from Dell EMC’s capacity‑only contracts and Azure’s more limited feature set.
Leverage ONTAP’s multi‑cloud tiering to upsell existing AWS EVS customers to a “global data‑fabric” that also spans Azure and GCP. A cross‑cloud narrative will protect NetApp’s market‑share against Azure’s “VMware‑first” push.
Develop migration tooling (e.g., automated vSphere → FSx‑ONTAP migration scripts) to lower the “lift‑and‑shift” barrier. Faster migrations = quicker revenue, and it creates a moat around the EVS ecosystem.
Target midsize enterprises (‑ $500 M‑$2 B IT spend) that are most price‑sensitive and likely to adopt EVS now. Dell EMC and HPE focus heavily on large enterprises; NetApp can capture the “growth‑segment” that is currently under‑served.

6. Bottom‑Line Impact

  • NetApp’s hybrid‑cloud storage market share is expected to rise from ~12.5 % to **≈ 16 % by the end of 2027, a **~30 % relative gain.
  • Dell EMC’s share will likely dip modestly (≈ 2 % decline) as customers migrate to the NetApp‑EVS bundle.
  • HPE’s share will stay flat or decline slightly unless it accelerates its own AWS‑first storage offering.
  • Microsoft Azure will retain its “cloud‑first” storage lead but will lose **≈ 3‑5 % of VMware‑centric customers to NetApp’s integrated ONTAP solution**.

In short, the NetApp‑AWS EVS partnership is a catalyst that positions NetApp as the de‑facto “one‑stop shop” for VMware workloads on AWS, giving it a clear competitive edge in the hybrid‑cloud storage arena. The net effect will be a steady, double‑digit market‑share uplift over the next two‑three years, especially among cost‑conscious midsize enterprises and existing ONTAP customers looking for a frictionless path to the cloud.

Other Questions About This News

Will the partnership drive new cross‑sell opportunities with NetApp’s data‑management and security software? How is the market likely to react to the news in terms of stock price movement and analyst sentiment? How does the integration compare technically and financially to the Azure VMware Solution and Google Cloud VMware offerings? Will the partnership accelerate migration of VMware workloads to AWS, thereby boosting NetApp's storage consumption and data‑services usage? What is the expected adoption rate of Amazon EVS and associated NetApp ONTAP storage among existing VMware customers? What pricing and margin impact does offering FSx for NetApp ONTAP as a storage option for Amazon EVS entail? How could this news influence NetApp's FY2025 guidance and EPS forecasts? What incremental revenue or ARR growth does NetApp expect from the Amazon EVS integration? What are the potential risks or integration challenges that could affect the rollout timeline or customer adoption?