Too quiet on this thread,better make some posts........
The big dog....
techweb.com
EMC Buys Its Way Into Midrange Storage Market -- Data General buy shows blurring of the line between high-end and midrange storage
Rick Cook
EMC Corp., a maker of storage for mainframes and other high-end systems, is broadening its reach. The company has announced it is purchasing Data General Corp., a former minicomputer giant now best known for its CLARiiON line of midrange storage products. The move is a good fit for EMC and a logical response to changes in the storage market, but even EMC isn't clear on what it will mean for VARs.
"EMC recognized that it needed to have a midrange product as well as a high-end product," says David Hill, senior analyst of storage and storage management at Aberdeen Group Inc., Boston.
What this means for storage companies, and the VARs and systems integrators who handle their products, is that to be a major storage player in the corporatewide market, you have to cover both the high end and the upper part of the midrange simultaneously. EMC was strong in the high end, but it didn't have much in the midrange. "To move into the midrange, they needed an architecture other than Symmetrix, which was originally designed for mainframes," Hill says. "To try to develop their own architecture would be a time-consuming process. In Data General, they had a good company with a good product line nearby, so it [buying Data General] was a logical thing to do."
"From a product point of view, it's an excellent fit," says Roger Cox, chief analyst for server and RAID storage at Dataquest Inc., San Jose. "From a geographical standpoint, it's outstanding." Cox points out that the companies' headquarters are about five miles apart in the Boston area.
This isn't the first time EMC has been in the midrange storage market. Hill points out that the company had a midrange line several years ago, but abandoned it. The company still has many employees who worked in the midrange market-including Tom Heiser, director of global channel development at EMC, who ran EMC's midrange channel program from 1989 until 1994.
"There's a huge expansion of a marketplace where EMC is not-the midmarket space," says Heiser. By moving into the midmarket, EMC expands its sales opportunities by about a factor of 10. Since, according to Cox, in 1998 EMC had 49 percent of the market for external storage, the best way to meet its stated goal of doubling sales in five years is to expand into new areas.
"Data General has a very fine product in their FC 5000 series," says Cox. "It's very robust, very sound and very well-accepted in the OEM market. EMC needed that kind of product to allow it to be more competitive pricewise in the entry midrange open systems market."
Impact On VARs
Just what this will mean for VARs is still unclear. For one thing, EMC is still working out the details, and there are a lot of things the company says it doesn't know yet.
Hill doesn't find this especially surprising. "When you're absorbing another large company, you have the basics figured out, but you have some of the details to figure out later," he says. Still, there are some details that VARs would like very much to know, including EMC's VAR strategy.
EMC will not get too specific in public about what it's going to do with Data General. All Heiser will say about EMC's channel plans for Data General is: "Moving forward, we have to assess what the CLARiiON channel looks like."
Heiser sees both similarities and differences in the high-end and high-midrange markets. "The similarities are that the customers are looking for an end-to-end solution, whether it's for business continuity, backup, data recovery, you name it," he says. "The difference is that there are more deals with less capacity. What does the channel strategy look like for that market? I can't answer at this point."
Neither EMC nor Data General uses VARs as their primary channel. EMC relies on its own sales force, backed up by partners who specialize in market areas. Until recently, Data General has done most of its storage business with OEMs from Siemens to Hewlett-Packard Co. "For EMC, the reseller is kind of a relationship builder with the end user," says Cox. "EMC supports its resellers with professional salespeople and support on the product itself."
Customer Needs, EMC Challenges
Increasingly, the manufacturers' value-add in the higher end of the storage market are in software rather than hardware. In spite of the growth in Fibre Channel storage arrays, storage hardware is becoming a commodity. The key differentiator is the software that lets customers manage their storage-all their storage.
What's needed, Hill says, is seamless interoperability, not necessarily a single architecture. "It may be that a single architecture can't stretch across everything. If you have the right storage management software so everything works together seamlessly, it [a single architecture] may not be an important consideration. As long as they have the logic, or virtual glue, the physical underlying platforms may not need to be the same."
Whatever the challenges, no one seems to be willing to bet against EMC in its acquisition. Not only does the company have its earlier midrange experience to guide it, but it's not uncommon to hear EMC's marketing compared to IBM Corp.'s in its glory days.
techweb.com
Mammoth Changes Coming
David Gabel
The Internet is making itself known in the storage business, as companies, notably led by Storage Technology Corp. (StorageTek), are beginning to sell storage as a system available over the Net. Will this turn out to be the next big thing, or will it simply be something tried and soon forgotten? Analysts and vendors are of different minds on the question, and contributing editor Peter Jordan reports on this new trend in our story on storage leasing.
Meanwhile, EMC Corp. is in the process of buying midrange storage system maker Data General Corp. This gives EMC a foot in the door of the midrange storage market, where it will be able to expand its former enterprise orientation into an extremely lucrative and growing market. What does this mean for VARs as they contemplate the storage market and their opportunities therein? Contributing editor Rick Cook examines this event and its possible repercussions from all angles in our lead story in this storage Special Report. |
