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Ctera Networks' CEO, Liran Eshel, predicts enterprises will broaden their cloud strategies in 2017 to include multiple providers and increase security following recent hacks of major sites and escalating ransomware attacks.

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Eshel, who founded the enterprise file services platform and cloud storage gateway vendor in 2008, has been forging partnerships with larger companies to prepare for the rise of multicloud strategies.

Ctera Networks this month joined Hewlett Packard Enterprise's HPE Complete Program. The program enables HPE and its resellers to sell a validated HPE and Ctera system and support through a single contract. The HPE relationship represents the second significant partnership for Ctera Networks over the last six months. A partnership formed with IBM in late 2016 facilitated the use of Ctera products with IBM Cloud Object Storage and the IBM Cloud.

Ctera Networks' software is infrastructure-agnostic, although most customers use its software packaged on a hardware appliance because it's better integrated and easier to use, according to Eshel. He said Ctera Networks' customer base spans cloud service providers, government agencies, financial service firms and insurance companies, and it includes the U.S. Department of Defense, Santander Bank and Telefonica.

SearchCloudStorage recently caught up with Eshel to discuss customer and industry trends, and to take stock of Ctera Networks' progress and the competitive landscape.

Ctera used to get categorized with the cloud storage gateway products that analysts predicted would go away once major storage vendors picked up the functionality. How have you had to evolve your product and add functionality to stay a step ahead?

Liran Eshel: The space of enterprise file services has evolved for decades around the traditional players, like NetApp, EMC, Microsoft, where you have systems like NAS and SharePoint. The space of cloud-based file services is much newer; maybe we could say 5 years old. And, naturally, you don't close the gap that was built by decades of enterprise software development in two or three years. It takes a bit of time.

The first implementations were point solutions. People [said]: 'Here is a sync-and-share solution. Here is a backup solution. Here is a gateway solution.' But, in order to be a serious player in this market and to provide an alternative to an enterprise and say, 'Hey, we'll be able to transform all your files into this cloud-based file services system,' you cannot just come with point solutions.

They don't need just one use case. They need to have a unified system that can address and replace the traditional enterprise storage systems that they used to use before. That's the approach of Ctera -- being a unified platform addressing the full continuous enterprise needs in that space.

If you look at Ctera just as a gateway company, you're missing the point. Sure, an enterprise needs gateways, but it's not enough. If you look at Ctera just as a sync-and-share solution, it's nice, but it's not enough. What do you do about data protection? What do you do about remote sites? If you look at having all three together -- sync and share, backup and gateways over a common multicloud file system -- then you see Ctera.

Who are your competitors? Who do you see in deals?

Eshel: Most of the time, it's replacing traditional -- so it could be NAS technology, Windows servers, traditional backup software. Most of the market is still based on these technologies. There is huge displacement that's being done from traditional backup and traditional NAS systems to cloud-based systems like ours.

There are also newer, younger cloud-based companies in this space. You have gateway vendors, like Panzura and Nasuni; you have backup vendors, like Druva.

Do your enterprise customers want to move all of their data to the cloud, or only some of it?

Eshel: From what we see, moving everything is not practical. Obviously, they want to move significant parts of the data, but one cloud is not enough. What we see is usually a requirement to have a multicloud environment where they have at least two options with cloud infrastructure, as well as an on- prem. So, you would see two clouds and a private data center.

The split of how much data would be migrated into the cloud depends on the organization. An organization that's more cloud-ready could move something like 60% to 80%. An organization that has much more legacy would maybe be at 20% to 30%.

If you look at Ctera just as a gateway company, you're missing the point. Sure, an enterprise needs gateways, but it's not enough. Liran EshelCEO, Ctera Networks

What type of data are they moving?

Eshel: We focus more on the unstructured data, which makes up about 80% of all enterprise storage and is the fastest-growing area of enterprise storage. With unstructured [data], it's sometimes easier to move to the cloud because the I/O is less intensive. It could be from user files, logs, applications generating unstructured content, data analysis and things like that.

And it's generally file-based data?

Eshel: Yes, files make up a large part of it. We have home folders, project shares, archives, backup -- all these sorts of things. Because the basic component of cloud infrastructure in terms of storage is usually block and object, Ctera basically allows you to store files on top of an object cloud storage system. So, you can use Amazon S3 [Simple Storage Service], [Microsoft] Azure object storage or the [IBM] SoftLayer object storage. And, basically, using Ctera, we can store files while preserving permissions, ACLs [access control lists] and all of that. We provide full preservation of the access control lists while migrating file structures to object in the cloud.

Most major storage vendors have been adding features to work with clouds. What do you offer that vendors such as NetApp don't?

Eshel: First of all, we are in more than file servers, which means that the interface is not just the traditional CIFS/NFS. We have a modern interface with the file system share with mobile, user collaboration -- all the features that you would expect from a modern file service.

The second thing has to do with the native integration with cloud. You run a NetApp system in Amazon. We, on the other hand, can run off the Amazon object storage directly. So, all the data is stored in object storage, which is significantly less expensive and much more scalable than the way that NetApp is doing it. We can also do it in a multicloud environment, where you basically could connect to two different clouds. I'm not just talking about NetApp. I'm talking to any traditional NAS system as an alternative.

Are you concerned that the major storage vendors will start picking up more of the functionality that you offer?

Eshel: We actually partner with the traditional NAS vendors. We partner with [HPE], IBM, NetApp, because we provide them a software platform that allows us to provide the modern file service that they don't have. From what we see right now, there are big investments being done in object storage, where you see IBM acquiring Cleversafe. You see [HPE] partnering with Scality. NetApp is also investing in object storage technology. And that's complementary to Ctera, because we basically can interface with these object storage systems and provide a combined solution.

What are the most significant customer trends we can expect to see this year?

Eshel: First of all is security. People realize the security risks of cloud are very significant. And the recent hacks -- basically thefts from services like Yahoo, Dropbox, where basically millions and hundreds of millions of accounts were compromised -- I think caused enterprises to pause and to rethink their cloud strategies. Are they willing to move their data to a cloud where the cloud provider manages all the keys and the encryption and the user credentials? And what does it mean if the cloud provider gets hacked? That's one thing that we see.

It's also very closely tied to ransomware, where people are paying a penalty with these hacks. If someone gets access to your credentials, they can basically encrypt the lock and the files of the organization, and it's a file hostage situation, which could be very, very expensive and risky. Customers are looking for more secure solutions where they can control the key management and the encryption and be less vulnerable to such attacks.

The second thing we see is multicloud, where customers are looking for a unified solution that doesn't lock them to just one cloud provider. It gives them the option to control where data is stored -- what stays in the data center and what goes to which cloud provider. It also is tied to regulation and compliance and data sovereignty.

How are you addressing the security concerns?

Eshel: What we say is, 'Here is your virtual private platform. It's not shared with other customers. All the metadata and encryption keys remain with you.' And the entire system can be inside your firewall and inside your VPN. So, for someone to penetrate and access your files, they will need to penetrate your filer, which is equivalent to penetrating to your network ... Just doing encryption is not enough. Many of these services that were hacked in the last year, they're encrypting. But the question is not if you encrypt; it's where do you keep the keys, and who can have access to your keys, and who can have access to your data.

Cloud storage trends in 2016

Using enterprise file sync and share

Stand-alone EFSS market remains viable

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Ctera Networks prepares for rise of multicloud adoption - TechTarget