EMC to target low-end storage market

NEW YORK -- With an admission that the EMC Corp. of old was something of a one-trick pony for high-end storage, company officials today said to expect a wider reach into the middle and lower-end storage markets.

"EMC's traditional strategy has been one-size-fits-all," said David Donatelli, executive vice president for EMC's storage platform operation, speaking at an analyst meeting here.

But going forward, Hopkinton, Mass.-based EMC plans to take its expertise in high-end enterprise storage and migrate the technology down into a range of new storage hardware and software that is expected to arrive over the next nine months, according to EMC President and CEO Joe Tucci.

The new EMC storage products for midsize and small companies, which will be based on commodity-grade Intel chips and initially built by EMC channel partner Dell Computer Corp., mark a significant change from EMC's traditional way of designing storage.

Future EMC storage systems for small businesses will be "integrated storage appliances" that, among other things, will run Microsoft Corp.'s Windows operating system and contain mixed technologies to deliver the functionality of a storage-area network (SAN) device, a network-attached storage (NAS) device and a backup device, said Donatelli.

EMC's products for the midrange market will offer "centralized intelligent capacity" in a modular storage architecture that allows customers to add or subtract multiple storage functionality, said Donatelli.

Commonality across the management software of the new EMC storage systems is also a goal for the company across its entire line of storage hardware products, he said.

Not forgetting that EMC is also midstream in a colossal ramp-up in enterprise storage management software, upgrades to EMC's Automated Information Storage (AutoIS) initiative were also announced. Erez Ofer, executive vice president of EMC's open software operations, said to expect policy-based storage provisioning in the next version of the company's EMC Control Center software. He also said EMC should deliver in the next three to four quarters improved virtualization tools by way of enhanced data migration and data presentation.

To more quickly ramp up EMC's software efforts across the board, Tucci didn't rule out near-future acquisitions of third-party software companies, but he wouldn't elaborate.

While Dell will be the first to build the new mid- and lower-tier EMC storage boxes -- co-branding them EMC/Dell -- Tucci said other vendors capable of following EMC's technology blueprint for the products are welcome to build and resell them on a licensed basis.

By allowing industry-standard hardware vendors like Dell to serve as original equipment manufacturers for EMC storage products for small and midsize businesses, EMC keeps itself at arm's length from the falling hardware margins of that industry sector, said Tucci.

Going forward, EMC hopes to better control costs by merging its component purchasing channel with that of Dell, giving both EMC and Dell the freedom to look for better deals when it comes to buying products such as disk drives.

"We are going to merge ours and Dell's supply chain, so we're both out there looking for the best deal," said Tucci.

EMC will also save money by reducing its portfolio of disk drive options from 10 to three. Power supply options will drop from seven to three. And a common host bus adapter for Symmetrix and Clariion systems should also bear added savings, said Donatelli.

With all of the changes, EMC believes it will successfully shed a perception that the company cares little for customers not able to pay a premium for the highest-end storage, a perception EMC created for itself, said Tucci.

"I think [customers] got mad at us, truthfully," said Tucci, who added that the new EMC attitude is one of "a confidence, not an arrogance."

As for the competition, Tucci downplayed any threat from Hitachi Data Systems Corp., which resells through both Hewlett-Packard Co. and Sun Microsystems Inc. "HP and Sun are using Hitachi as a defense mechanism against us," Tucci said. IBM, he said, was a closed, "blue-on-blue" storage player.

Laura Conigliaro, an analyst at The Goldman Sachs Group Inc. in New York, said EMC will likely get the benefit of customer patience as it transitions into wider markets and delivers improved products. Size and an IBM-like reputation for being utterly reliable are both on EMC's side, she said.

"Customers may not like it, but they understand that issues like AutoIS are complicated," said Conigliaro.

This story, "EMC to target low-end storage market" was originally published by InfoWorld.


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