IBM-Hitachi Storage Alliance Leaves Many Questions Unanswered

IBM Hitachi

In the first part of the two-part agreement, the companies plan a multi-year alliance aimed at developing a common approach to future generations of storage networks, systems and solutions based on open standards.

In the second part, IBM will sell its hard-drive operations to Tokyo-based Hitachi, which will then set up a joint venture, based in San Jose, Calif., to develop and manufacture the drives. Hitachi will own 70 percent of that new stand-alone company.

The storage systems alliance includes a common approach to storage virtualization based on IBM technology, as well as joint development of high-performance technologies and functions for future storage systems and solutions focused on interoperability and open standards, including the emerging common information model (CIM) standard, officials of the two companies said.

CIM, which is supported by most storage vendors including Sun and EMC, is a technology developed under the auspices of the Storage Networking Industry Association (SNIA) to allow end-users to implement a single management tool to manage multi-vendor storage hardware.

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"IBM was pretty much the last major vendor to sign on with CIM," said James Staten, director of strategy for network storage at Sun, which is one of the main proponents of CIM. "So we're happy they joined. It will be a big help to customers."

Dave Hill, research director for storage and storage management at Aberdeen Group, a Boston-based analyst firm, said the alliance unites the R and D capabilities of two companies renowned for their storage technologies, particularly IBM's software and Hitachi's hardware portfolios.

The fact that both support CIM is significant because of widespread support among the industry for the technology, said Hill. "This will bring a level of comfort to IT managers to see so many companies working on CIM," he said. "It's the two-heads-are-better-than-one philosophy. It's positive for the industry and puts pressure on other vendors to move faster."

An IBM spokesperson was not able to offer many details about the Hitachi alliance because the deal "sprang up quickly."

The competition, on the other hand, was able to offer its take on the news.

Sun's Staten said the alliance will lead to new questions from customers. "What does this mean for Shark?" he said. "What about StorageTank? Should you wait to buy? What is the future of Shark? Clearly, the Hitachi architecture is better than Shark. You could see IBM move some Hitachi technology to the Shark, or even see the end-of-life for Shark."

Sun, which currently resells many of Hitachi's storage products, including Hitachi's flagship Freedom Storage line, could someday find itself in competition with the Hitachi-IBM alliance, Staten said. "But since we are selling Hitachi's 9900 array, we are already selling best-of-breed products," he said. "Someday it could be IBM might do the same. But customers [have to buy now. And resellers [have to sell now."

EMC officials, in a statement, called the alliance just one of many IBM has made with several vendors over the years.

Kip Lindberg, vice president of enterprise sales at Ncell System, a Minnetonka, Minn.-based Sun solution provider who works with the Sun-branded Hitachi arrays, said the alliance between IBM and Hitachi will be great if it means he can go into any storage environment and find it easy to work with multi-vendor products in a heterogeneous fashion.

However, Lindberg said he would be concerned if the end result of the alliance is IBM putting its own name on a Hitachi array similar to the way HP and Sun do now.

"I'd really have to evaluate what value that would offer to me," Lindberg said. "If it happens, I'd just have to put out an RFP (request for proposal) to all the vendors for the lowest price."

As for the joint venture between Hitachi and IBM in the hard-drive field, it is the latest sign the hard-drive industry is consolidating.

In late 2000, Maxtor acquired the hard-drive business of Quantum, making that company the No. 1 vendor of hard drives worldwide.

The amount Hitachi paid for IBM's hard-drive business was not disclosed.

Lorne Wilson, vice president of channel sales and marketing at Fujitsu Computer Products of America, said his company welcomes the move by two of its rivals to combine forces. "If you look at hard-drive acquisitions, the market share momentum of the two partners is usually lost after the acquisition," he said.

Wilson said the hard-drive business, which has traditionally been split into desktop, enterprise and mobile products, is now evolving away from the desktop. "We view this [joint venture as validation of our focus on the enterprise and mobile hard-drive business," he said.