Tough-talking EMC undaunted by challengers
By Tony Munroe
FRANKLIN, Mass., Aug. 5 (Reuters) - Big Blue may be circling with its new, fierce-sounding ``Shark' data-storage line, but market-leader EMC Corp. (NYSE:EMC - news) sought to reassure investors on Thursday that it expects to remain the big fish in the fast-growing storage sector.
Describing its sales force as ``feared' and its customer focus ``maniacal,' EMC executives told a gathering of nearly 300 Wall Street analysts that the company does not foresee any competitor ready to close the company's leadership gap.
To make its point, Hopkinton, Mass.-based EMC included aerosol cans of ``Shark Repellent' (actually Silly String) in the cache of party favors distributed to each guest.
Last week, International Business Machines Corp. (NYSE:IBM - news) launched a bid to reclaim ground in the storage business, which it pioneered, with the introduction of its Enterprise Storage Server, called ``Shark.'
But to attack EMC, President and Chief Executive Michael Ruettgers told the audience, a competitor would have to take on EMC's product, service and distribution capabilities, ``and frankly, we don't see anybody poised to do that.'
To kick-off the meeting at EMC's gleaming new manufacturing plant west of Boston, Ruettgers was introduced accompanied by a video of himself behind the wheel of the Formula One team race car EMC proudly sponsors. Racing and other macho imagery were sprinkled throughout presentations by executives.
To date, EMC has mostly lived up to its bold talk, and Ruettgers reiterated his belief that EMC can top $10 billion in revenue by 2001, up from $3.9 billion in 1998: ``We simply don't see any bumps in this road.'
EMC attributes part of its success to its focus. Its storage systems, typically refrigerator-sized cabinets of hardware driven by sophisticated software, own a 35 percent market share.
Executives were blunt in their assessment of Shark. ``We think it's going to be a long, long time before you see Sharks connected to anything other than IBM products,' said James Rothnie, a senior vice president.
Besides the Shark threat, EMC suffered a blow in May when major customer Hewlett-Packard Co. (NYSE:HWP - news) dumped it and signed a pact to resell high-end storage products made by Hitachi Ltd. of Japan.
But analysts in attendance said EMC appears ready to meet its challengers.
``Those are big, powerful companies, and they could improve their products,' said analyst Phil Rueppel of Deutsche Banc Alex. Brown. ``I think EMC is cognizant of that.'
Added Gary Helmig of Soundview Financial Group, ``Everybody's been after EMC. (The competitors) have just been stumbling over their shoelaces.'
He noted that competing product lines won't be fully available until next year. ``It would be of particular concern if EMC were standing still, but I don't believe they're standing still.'
During the all-day meeting, EMC announced a new program to make ``application programming interfaces' (APIs) available to independent software developers, so they can design products that integrate EMC systems and software.
``Opening up the APIs will help them a lot, because it has been a customer complaint,' Rueppel said.
biz.yahoo.com |
