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VMware To Buy Datrium, Enhancing Disaster Recovery Capabilities

The deal for the hyper-converged infrastructure startup looks to advance VMware’s hybrid cloud standing with a cost-optimized solution for backing up data in the cloud. Datrium competes directly with Dell EMC, and the agreement comes amid talk that Dell Technologies is considering spinning off its VMware subsidiary

VMware disclosed on Wednesday a deal to buy Datrium in a bid to bolster its cloud-based disaster recovery capabilities—and its larger hybrid cloud ambitions—with the startup’s innovative hyper-converged technology.

Datrium will enable the Dell Technologies-owned virtualization giant to deliver on its vision for a cost-optimized option to protect data stored either on-premises or on Amazon Web Services’ infrastructure in its Disaster Recovery-as-a-Service portfolio, said Andrew Wang, VMware’s vice president for strategy and corporate development, in a company blog post.

Financial terms were not disclosed.

Founded in 2012 in Sunnyvale, Calif., Datrium currently partners with VMware to offer end-to-end disaster recovery for workloads running on VMware Cloud on AWS. The company’s technology was designed to reduce cost and complexity, whereas VMware’s existing on-demand DR service, VMware Site Recovery, is optimized for performance, Wang said.

[Related: Datrium Automatrix Brings Software-Defined Converged Infrastructure To Multi-Cloud Environments]

“The Datrium DRaaS solution offers an innovative, cost-optimized approach with incremental backups that are encrypted, deduped, and stored efficiently in AWS S3,” Wang said.

Datrium will not only bring that unique IP under VMware’s roof, but also a team of expert engineers who can help broaden VMware Cloud alliances with leading cloud providers with business continuity solutions that operate consistently across hybrid infrastructure, blogged John Gilmartin, senior vice president and general manager of VMware’s cloud platform business unit.

“This is a significant move forward to help customers build hybrid clouds,” Gilmartin said.

Rocco Guerriero, CEO of Contour Data Solutions, a Doylestown, Pa.-based solution provider working with both companies, said that while the agreement came unexpected to him and his entire team, it’s actually not that surprising.

Datrium has incredible technology, Guerriero told CRN, but its marketing efforts haven’t risen to the same heights.

“Datrium's executives are good people, smart people. The company was just challenged with how to go to market,” Guerriero said.

Datrium's hyper-converged DRaaS technology is a good fit for VMware, as it was built with openness in mind, and no tie to any one vendor’s hardware base, Guerriero said. At the same time, “their AWS story fits well with VMware's AWS story."

Datrium’s technology could also boost VMware’s virtualized storage business—even potentially replacing vSAN at some point, he said.

"Datrium did a real good job with its software-defined technology. It can move data between platforms and the cloud, and that is important today,” Guerriero said.

With so many ‘unicorn’ startups in the storage industry going sideways, Guerriero said he’s glad to see VMware acquiring Datrium. "It will let Contour invest more in VMware."

Datrium’s last funding haul came in September of 2018, when the company raised $60 million to accelerate growth.

That Series D round brought total funding to $170 million, led by Samsung Catalyst Fund. Samsung has a longstanding relationship with Datrium as a major supplier of SSDs.

The acquisition could create an interesting competitive dynamic for VMware, which is majority owned by Dell Technologies through Dell’s 2016 acquisition of EMC. Three of Datrium’s four co-founders have ties to both EMC and Data Domain, which EMC acquired a decade ago for $2.4 billion, and Datrium competes directly with Dell EMC storage solutions.

Dell Technologies is considering spinning off VMware, of which it owns 81 percent, to ease its financial load. Two of Dell’s largest shareholders, private equity firm Silver Lake and hedge fund Elliott Management, have voiced support for that plan over a potential alternative of Dell buying the remaining shares of VMware.

Last year, Datrium began shipping its Automatrix platform for providing integrated compute, primary storage, backup, disaster recovery, encryption and data mobility.

"We are a multi-cloud platform, and we've done the hard things that no one else has done," Datrium CEO Tim Page told CRN in May of 2019.

Datrium sells the DVX series of on-premises hyper-converged infrastructure offerings targeting separate server and storage nodes. DVX provides a flash storage platform for running customer applications and includes built-in data protection and disaster recovery capabilities.

It also brings to market Cloud DVX, a cloud-native version of DVX for Software-as-a-Service-based backup and recovery, as well as ControlShift, an automated disaster recovery service with fast recovery, global deduplication, continuous compliance checks, and nondisruptive disaster recovery testing.

Joseph Kovar contributed to this story.

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