Belluzzo to VARs: ADIC Buy Makes Quantum Major Vendor

That's the message that Rick Belluzzo, chairman and CEO of Quantum, and other executives brought to attendees of the company's sixth annual channel conference, held this week in La Jolla, Calif.

Belluzzo, in some of his first public comments about the $770 million acquisition since the agreement was signed last month, told solution providers that late last year he looked at the storage business and saw how system vendors such as Hewlett-Packard and IBM have come to dominate the backup, restore and archiving business, a trend reinforced by Sun's acquisition of StorageTek.

"I didn't want Quantum to be seen only as a focus form OEMs to cut their expenses," Belluzzo said. "I wanted to make sure Quantum controls our own market and destiny and to take leadership of this market with the 'departure' of StorageTek. The acquisition by Sun marginalized StorageTek."

Quantum's move last month to acquire ADIC for $770 million is about focusing on the backup, restore and archiving business from both the hardware and software sides, Belluzzo said. "It's about open systems, not about HP-UX or Solaris," he said. "It's about building a large independent solution supplier."

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The importance of having an independent leader in this space comes from the ability to influence the marketplace and bring new technology to play, Belluzzo said. "We didn't want to be in a position where, if we had a new idea or technology, we have to go to the OEM and say please, please, please, please try this," he said.

Combining the two companies also improves their ability to innovate for future growth and have the financial ability to compete as a really strong independent storage player, he said.

Belluzzo's message resonated with partners who agreed that the acquisition will give Quantum a strong say in the storage business, especially in the secondary storage space.

Rich Baldwin, president and CEO of San Diego-based Nth Generation, said that the acquisition will make Quantum the solid No. 3 independent storage supplier, after EMC and Network Appliance.

It also makes it easier for customers to look to Quantum as a top supplier for secondary storage and an alternate to system vendors such as HP, IBM and Sun, Baldwin said. "Customers naturally want a choice," he said.

Michael Pearce, vice president of sales at OptiStor Technologies, a Bellevue, Wash.-based solution provider, said that Quantum's acquisition of ADIC was confusing at first because he didn't see what Quantum was getting other than a maintenance stream.

However, Pearce said, Quantum is now looking very smart in terms of how it can use some of the technology from ADIC to deliver solutions customers are asking for, especially in terms of storage security and the ability to compress the amount of data being backed up, the latter of which comes from Rocksoft, a software developer acquired by ADIC in March.

"Rocksoft is a powerful technology," Pearce said. "It will take the tape library from the trailing edge of the deal to the front. It hits real customer pain points. If Quantum can implement and integrate technology like that fast enough, it will be terrific."

At the conference, Rob Pickell, vice president of worldwide marketing at Quantum, said that for the rest of 2006, Quantum will take advantage of the ADIC acquisition to push hard on developing a strong portfolio of backup, restore and archive products to complement its tape business.

"One of the areas that we're most excited about is the ability to very aggressively move forward in our non-tape portfolio," Pickell said. "Being able to expand our backup and recovery and archiving solutions outside of our core tape business. This is an area where we think the ADIC/Quantum intellectual property, engineering resources, services infrastructure will be extremely synergistic. The goal is to be able to develop an overall code base portfolio that allows us to build on our core backup and recovery tape business into new solutions areas like disaster recovery, operational recovery, and compliance and retrieval."