NetApp Buys Riverbed's SteelStore Storage Line For $80M

NetApp is acquiring Riverbed Technology's SteelStore line of cloud storage appliances for $80 million, both companies said Monday.

The all-cash deal will help bolster NetApp's own cloud backup and storage offerings with new capabilities for deduplicating, encrypting and rapidly streaming data to the cloud, according to the Sunnyvale, Calif.-based vendor.

Riverbed's SteelStore product, which until May was branded as 'Whitewater,' is a cloud-integrated backup solution that combines an on-premises cache with a backup cloud. It uses Riverbed's core WAN optimization technology to accelerate cloud data access and protection.

[Related: Riverbed Responds To Mounting Shareholder Pressure With Plan To Cut Costs, Explore Options]

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Phil Brotherton, NetApp vice president of cloud solutions, said the back end for SteelStore could be a public cloud, private cloud or even an internal storage grid.

Brotherton was unable to provide much detail about NetApp's plans for integrating the SteelStore solution into the NetApp line. "But the product fits the channel well as it is," he said.

SteelStore supports a range of cloud providers, including Amazon Web Services, Google and Windows Azure, along with a mix of backup and archiving applications.

NetApp and Riverbed have a number of technology partners in common including Symantec, CommVault and Veeam. A NetApp spokesperson told CRN in an email that the company will continue to work with those partners to further the integration of SteelStore with their own solutions.

Nathan Holman, vice president of solutions at Syscom Technologies, a Marietta, Ga.-based NetApp and Riverbed partner, said the deal is a win-win for both companies.

For Riverbed, Holman said, the move allows the company to shed a part of its portfolio that's not core to its overall focus on application performance and optimization. He noted that, as a partner, SteelStore was sometimes a difficult sell, given the "typical" Riverbed customer didn't necessarily have a focus on back-up and storage.

"[SteelStore] was probably one of the most inorganic pieces of [Riverbed's] portfolio," Holman told CRN. "That product, while it's a great product and leverages some of Riverbed's organic capabilities from [its WAN optimization appliance] SteelHead, I think everyone had a little trouble positioning it."

Riverbed earlier this month said it's restructuring and starting to explore strategic options in response to mounting pressure from activist investor Elliott Management.

Holman said, for NetApp, the deal will significantly strengthen the company's back-up capabilities, something he said has "always been a challenge for NetApp."

"It's a great move for them, and it's a great move for NetApp," he said.

NetApp said it will start offering the SteelStore products in its fiscal third quarter of 2015.

Riverbed, in an online FAQ, said responsibility for future sales of its SteelStore appliances will be transferred to NetApp on Oct. 28. NetApp and Riverbed have agreed to a joint support structure during the transition period, and customers can get support through their existing support contacts.