When EMC purchased Legato Systems and Documentum last year, the conventional wisdom was that the company was moving from its traditional position as a hardware vendor into the software business. The thinking was that, like computer platforms, storage hardware would rapidly become a commodity and prices would plunge. Vendors that wanted to survive would have to add value through their software offerings. EMC was seen as snapping up a couple of companies with good technology at good prices just as the recession in technology spending was coming to an end.
But EMC's acquisition of VMware last month clearly indicates that the storage leader has more in mind than diversifying its software offering. In fact, EMC could be undergoing a complete makeover, repositioning itself as a supplier of the virtualization layer in the enterprise. Although it's been a front-burner issue for some time, storage virtualization is still more often talked about than effectively implemented, according to many reports. But putting a management layer on top of hundreds or thousands of small servers is as difficult as adding a management layer to a collection of heterogeneous storage devices. The whole notion of grid computing is based on the ability to effectively manage thousands of small computers as if they were a single entity.
In many ways, server virtualization is the yin to consolidation's yang. As the implementation cycle swings from consolidation of many small servers, which has been the mantra for the past 3 years, toward fewer larger ones, virtualization at many levels of the enterprise and in the IT stack will become increasingly important.
But EMC isn't the only storage stalwart that seems to be reshaping itself to meet the new challenges it will face over the next several years. Last summer, VERITAS Software completed its acquisition of Precise Software and Jareva Technologies, vendors of application management software. And late last year, VERITAS purchased Ejasent, whose primary products offer usage-based metering of IT assets and real-time migration of applications across servers with no disruption in service. No longer just a storage management company, VERITAS is aggressively stepping up its activities in application management.
In an example of how the repositioning of these two storage players is working itself out, in December VERITAS announced the availability of Storage Extension, an application performance management package for use with major relational databases. Storage Extension lets IT managers optimize EMC storage arrays and customize and tune applications and databases for optimal performance in an EMC environment. Although VERITAS has similar offerings that work with the technology of other major enterprise storage vendors, previously only EMC had offered that functionality for its own hardware. Now, VERITAS also will provide the functionality, giving administrators visibility from the application through the OS and the database to the storage array.
The moves by VERITAS and EMC raise two interesting questions. First, can these companies successfully pull off their makeovers? The answer to that question is that success is possible but not inevitable. IBM is the highest-profile example of a company that has completely remade itself on the fly, moving away from its legacy as a hardware vendor and re-emerging as a hybrid company selling computer services in addition to hardware and software. Although successful, the change wasn't easy and required IBM to jettison both its storage manufacturing division and its PC lines.
The second question is what do these moves mean for the storage industry? At first glance, it might seem that the acquisitions signal that neither EMC nor VERITAS felt that it could flourish as a storage specialist and that both were striving to enter more rapidly growing sectors. But that analysis would be wrong. These acquisitions can be better understood as a recognition that the role of storage technology is shifting within most enterprises. Even as Storage Area Networks (SANs) emerge as the dominant approach to storage, storage is becoming increasingly integrated with the rest of the IT infrastructure. Storage can't be managed independently; it must be managed in conjunction with the applications, servers, and networks throughout the enterprise.
EMC officials have long preached that storage administrators have to work more closely with database and network administrators. With these acquisitions, both EMC and VERITAS are putting their money where their mouths are.