Maxtor Bows Out Of Branded NAS Market, Will Support Existing Clients

Maxtor

The company, based here, will continue to support current customer and solution provider agreements for the company's MaxAttach branded NAS products.

Some inventory is now available to the channel, said Stephen DiFranco, vice president of corporate marketing at Maxtor.

As a result of the move, Maxtor also laid off about 150 people. Another 80 people from groups within the company who supported both branded and OEM NAS products will continue in that capacity, DiFranco said.

Maxtor's NAS business accounted for about $13.1 million during the second quarter of this year, DiFranco said. Of that, only a small part was branded business, he said.

"We entered the NAS market to understand the business," DiFranco said. "What we learned is that many companies we were working with as OEMs also planned to enter. So the logical move was to pull back and focus on hard drives for [the NAS space."

For now, Thursday's move does not affect Maxtor's OEM business. The company supplies components, including subassemblies and hard drives, to OEMs such as Network Appliance and Hewlett-Packard for their NAS servers.

DiFranco said Maxtor will continue to supply hard drives for such OEMs. However, whether it continues to supply subassemblies depends on whether the OEMs' plans, he added.

Maxtor entered the NAS business in August 1999 when it paid $57 million to acquire Creative Design Solutions, Santa Clara, Calif. That acquisition came about three months after a similar deal in which hard-drive vendor Quantum said it would acquire NAS vendor Meridian Data, Scotts Valley, Calif.