NetApp made the largest acquisition in its 23-year history Monday, plunking down $870 million in cash for Solidfire, an all-flash array storage startup that develops technology geared toward cloud service providers.
In a conference call held to discuss the deal, NetApp CEO George Kurian said Solidfire's technology is tailor-made for service providers and enterprises that use DevOps, a term that describes how software development and operations teams work closely to speed app deployment in cloud environments.
One of the keys to the Solidfire deal is that it will help NetApp diversify its customer base and target emerging technologies like software-defined storage and data management, according to Kurian.
"Solidfire will enable us to access new customers and areas of spending," Kurian said on the call. "We expect it to add two points to our growth profile over time."
SolidFire sells hardware as well as a software-only version of its technology called Element X, which is designed for white box hardware and aimed at hyperscale data centers, service providers and OEMs. It's also actively involved in OpenStack, a set of open-source technologies used to build private and public clouds.
Luis Benavides, founder and CEO of Day1 Solutions, a NetApp partner in McLean, Va., said he thinks the Solidfire deal makes sense in a flash storage market that's increasingly emphasizing high performance and low latency.
"I believe this acquisition better positions NetApp with physical, hybrid, cloud storage options," Benavides said. "This seems to be the direction that George Kurian is placing as a priority."
NetApp has been facing industry headwinds and some industry watchers believe its technology isn't keeping up with the times. The Sunnyvale, Calif.-based vendor ousted former CEO Tom Georgens in June and replaced him with Kurian.
Lee Caswell, vice president of product marketing at NetApp, said in an interview that the Solidfire deal shows that the storage vendor has a strategy for tackling opportunities in the modern data center. "We see [the deal] as an opportunity, as well as a statement to the market and to partners," he told CRN.
Kurian said Solidfire will operate as a product line within the NetApp portfolio, led by Solidfire CEO Dave Wright. NetApp is shutting down FlashRay, its own all-flash array product, effective immediately, he said.