Storage Hardware Vendors Invest in Management Software - Industry Trend or Event

ENT, Jan 12, 2000 by Scott Bekker

Toward the end of 1999, several of the biggest storage hardware manufacturers made major investments in storage management software or launched related products.

Industry observers say the moves are efforts to meet user demand for control over storage systems that are growing larger and more complex and attempts by OEMs to maintain market share.

Compaq Computer Corp. (www.compaq.com) made a $20 million equity investment in Highground Systems Inc. (www.highground.com); EMC Corp. (www.emc.com) commenced a $192 million tender offer for Softworks Inc. (www.softworks.com); and Dell Computer Corp. (www.dell.com) closed a $340 million deal to buy startup ConvergeNet Technologies Inc. (www.convergenet.com).

Hewlett-Packard. Co. (www.hp.com) introduced virtual storage subsystem software for managing storage resources in a mixed hardware environment under the name HP SureStore E SAN Manager LUN Management. IBM Corp. (www.ibm.com) unveiled a host of new SAN offerings and announced interoperability testing of its products with several major ISV storage management tools, such as Legato NetWorker, Veritas Backup Exec, and Mercury SANergy Control.

Customer demand is pushing the recent rash of offerings. IT managers are faced with more servers to manage, with more storage capacity associated with each server. At the same time, the tight high-tech labor market means companies are having a hard time finding new people to manage the mushrooming storage.

Mark Lewis, vice president of Compaq's enterprise storage software business, explains his company's reasoning for expanding its storage management capabilities through the HighGround investment: "Our customers really are going to evolve to this place where they have heterogeneous hosts connected to heterogeneous storage. In order to do that effectively, we believe that customers are going to need very robust and very efficient management tools to be able to manage their data placement and resource utilization."

HighGround's Web-based Storage Resource Manager grew out of the Windows NT market and recently added agent support for HP-UX, Sun Solaris, IBM AIX, and Red Hat Linux. The company is adding agent support for Compaq's Tru64 Unix and OpenVMS.

John McArthur, program director for storage system research at International Data Corp. (IDC, www.idc.com), says the OEMs are moving toward heterogeneity cautiously, with a constant eye toward protecting storage sales associated with their own servers.

Part of the motivation for an OEM to sell storage tools that will manage other vendors' hardware and platforms is to protect the OEM against competitors' digging into the OEM's installed base.

"The reality is that the biggest opportunity you have [as an OEM] is to first capture all of the storage opportunity that is associated with your servers," McArthur says. "Just about everyone is talking about heterogeneity today, but their primary focus continues to be on making sure they capture the storage opportunity from their server sales."

One example is IBM's recent decision to put storage back under its server division.

"That was kind of a surprise. Everyone's talking heterogeneity, but I think IBM realizes that they've got to stop losing storage sales to the likes of EMC, HP, and people like that." McArthur says.

While EMC doesn't ride on the back of server sales in the same way as the OEMs, it is capturing the storage software sales for its Symmetrix lime of storage hardware. Its aggressive growth goals require EMC to branch out into other vendors' market share. Softworks' products are designed to improve management, performance, and integrity of storage across Windows NT, Unix, OS/390, and MVS platforms.