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

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Jayson Noland, an analyst with Robert W. Baird & Co., wrote in a research paper on Monday that technology from 3PAR will let Dell address the high-end storage market with an in-house solution.

"3PAR competes directly with EMC's Symmetrix platform, though 80% of Dell's relationship with EMC does not overlap with 3PAR," he wrote.

"Regardless, we would not expect EMC to be happy about this acquisition, and would expect the EMC/Dell relationship to be negatively impacted. EMC may be inclined to push CLARiiON more aggressively in the channel as a result," Noland wrote.

Another analyst firm, RBC Capital Markets, wrote in its research paper on the acquisition that it expects EMC's revenue from Dell, which is about $250 million per quarter, could be at risk in the coming year.

"With Dell's purchase of 3PAR, we believe EMC will take this as a competitive threat to its Symmetrix / V-MAX product line," RBC wrote.

For Dell, the plan is to eventually combine 3PAR's technology with that of three other storage-related acquisitions the company has made in the past few years.

Dell in early 2008 acquired EqualLogic, an iSCSI storage technology pioneer which has since become the center of Dell's storage business.

Dell early this year acquired storage vendor Exanet, a developer of clustered NAS technology. Exanet's appliances allow NAS to scale as more appliances are added, and can sit in front of other vendors' storage capacity.

Dell last month acquired Ocarina Networks, a developer of storage compression and deduplication technology which gives Dell the ability reduce the amount of data customers store across a wide range of devices.

David Scott, CEO of 3PAR, said at Monday's teleconference that 3PAR's technology, in combination with other Dell storage technology, will help accelerate customers' moves towards adopting public and private clouds.

For instance, Scott said, 3PAR's technology would be a great match with Dell's EqualLogic iSCSI technology for building scalable storage solutions, and when matched with Ocarina's compression and dedupe technologies would increase the efficiency of scalable storage.

"Together, Dell and 3PAR will be positioned to become a new storage powerhouse," he said. "Other vendors will be left flat-footed."


Next: Putting The Technology And Channel Pieces Together

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