IBM Confirms It Is Ending Resale Of NetApp N-Series Storage Solutions

IBM has confirmed that its storage OEM relationship with NetApp has changed, with sales of IBM-branded N-series solutions from NetApp expected to end shortly while sales of storage solutions based on NetApp's E-series are expected to continue.

IBM, in a statement emailed to CRN, confirmed for the most part earlier reports that IBM planned to end its OEM relationship with NetApp .

In the statement attributed to an IBM spokesperson, IBM said its N-series Release 30, which was unveiled in mid-February, is the last IBM enhancement to the N-series product line.

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IBM also said it formally withdrew sales for new N-series systems as of Tuesday, although it will accept orders for the solutions for another 90 days.

IBM also plans to make miscellaneous equipment upgrades available for 12 months, and has promised to support current N-series products and configurations through 2018.

However, IBM said it will continue to OEM part of NetApp's E-series arrays based on technology from NetApp's 2011 acquisition of Engenio.

That includes IBM's DCS3700 and DCS3860 high-density storage drawers that integrate with IBM System x, BladeCenter and Power Systems. IBM also may source NetApp storage solutions as part of a reseller agreement through IBM Global Technology Services.

Solution providers said IBM's channel partners had expected the move for some time, and have already shifted to selling NetApp-branded versions of IBM's N-series storage solutions.

"It's not like any of us didn't know this was coming," said Chris Pyle, president of Champion Solutions Group, a Boca Raton, Fla.-based solution provider and longtime IBM channel partner. "I don't think anybody who sells N-series is surprised about this. IBM has been giving hints it prefers to focus on its own products including the V7000 line ."

While Champion actually is seeing sales of IBM's storage technology rising, it also is enjoying increasing NetApp sales as well, Pyle said.

"Any partners with substantial N-series sales, and I don't mean one unit, like Champion have become NetApp partners," he said. "So the change is no big deal for us."

Another IBM solution provider, who preferred to remain anonymous, said the move has been expected for a long time, and that N-series sales have been gradually drifting to NetApp.

NEXT: IBM Says Move Related To New 'Best-in-industry' Solutions

"We've been asking IBM for a couple years about its NetApp relationship," the solution provider said. "The standard party line response has been, 'NetApp remains a strong partner.' Customers have been moving to the NetApp logo. There's a comfort factor there for IBM customers."

IBM, in its statement, explained its decision as part of a move to focus on, and invest in, solutions that help the company deliver "best-in-industry solutions."

"Cloud and the explosion of data associated with social and mobile are increasing the demand for flexible storage solutions. This is driving a shift toward software delivery models and towards storage repositories that enable multiple use cases such as object, big data and file. With IBM Smarter Storage solutions, IBM’s objective is to transform the economics of data while addressing this shift.

"With leadership in software defined storage, data virtualization, flash and cloud deployment at a scale that enables clients to support both traditional and emerging workloads, IBM has developed an organic range of solutions that deliver cost effective, scalable data storage models for improved data economics," IBM wrote.

IBM's overall storage sales have been rapidly contracting for the last couple years. IDC in March reported that IBM's fourth-quarter 2013 external disk storage revenue, which would include revenue from the N-series, fell 10.6 percent over the fourth quarter of 2012.

IBM reported in April that first-quarter 2014 storage sales plummeted 23 percent compared to the same period one year ago.

IBM and Lenovo are currently finalizing the sale of the majority of IBM's x86-based server business to Lenovo. That sale, once it is completed, will likely reduce IBM's footprint in customers' data centers, resulting in a further drop in storage sales.

Meanwhile, NetApp last week reported its total fourth-quarter 2014 revenue fell nearly 6 percent over the same period last year.

PUBLISHED MAY 28, 2014