3PAR Bid Takes Dell Into Enterprise Storage, Raises Concern About EMC

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Dell is moving toward building a world-class storage offering with its plan to acquire 3Par and integrate its technology with that from other acquisitions such as EqualLogic, but in the process is putting at risk its long-term EMC partnership.

Dell on Monday said it plans to acquire 3PAR, a provider of virtualized storage solutions, for about $1.15 billion, giving it enterprise-class technology which Dell can use to help customers build public and private clouds and reach into the high-end enterprise storage market.

3PAR is a developer of technologies for virtualizing storage for customers looking for a tiered storage infrastructure or multi-tenant arrays that can be used for public and private cloud computing.

Among those technologies are thin provisioning, which allocates more storage capacity to mission-critical applications than is physically available. 3PAR's storage technology is highly scalable, with performance and utilization increasing as capacity is increased.

However, as it reaches upwards into the enterprise, Dell will likely compete more and more with EMC, which is currently Dell's primary storage technology partner.

Dell, which currently accounts for up to a quarter of EMC's midrange Clariion storage sales, does resell EMC's enterprise-class Symmetrix storage on a limited basis.

Brad Anderson, senior vice president of Dell's Enterprise Product group, said Monday at a conference call for media and analysts that EMC is a strong partner of Dell, and that there are no changes in Dell's relationship with EMC in regards to Dell's sales of EMC Clariion arrays, NAS appliances, or dedupe technology.

Instead, Anderson said, Dell's goal is to provide customers a choice of technologies. "And we're providing them this exciting choice in 3PAR as well going forward," he said.

Dell has been investing in increasing its ability to increase its enterprise technology and sales capabilities, and 3PAR brings dell highly differentiated technology and better gross margins that allow it to compete in the high-end storage market, Anderson said.

"You just can't do that with something like Symmetrix," he said.

While Dell tried to brush off concerns about how the pending 3PAR acquisition might impact that company's relationship with EMC, that remains an open question going forward.


Next: Measuring The Impact On The Dell-EMC Relationship

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