On the one hand, vendor analyst events are a good opportunity to spend focused time diving deep into individual products, roadmaps, and corporate initiatives. On the other, they're a useful forum for getting the feel of a company's overall zeitgeist in a way that narrower discussions don't. EMC's event, held last week in Franklin, Mass., was no exception.
(Credit:
EMC)
Perhaps the single thing that struck me most about the event as a whole was the full integration of VMware into the discussion as a whole. I've been following both companies since before EMC acquired VMware in 2003. In the years since, although there were the obligatory nods to joint development work and "better together," VMware aggressively maintained a distance that was hardly limited to the 3,000 miles between VMware's Palo Alto, Calif., headquarters and EMC in Massachusetts. VMware's presence at EMC analyst events was largely relegated to a few off-hand mentions and perhaps a desultory breakout session given by a junior marketing person.
This year couldn't have been more different. VMware was very much woven into just about every discussion and one of VMware's senior technologists shared a panel with representatives from EMC and Cisco Systems. One thing that has changed, of course, is the ouster of VMware founder and CEO Diane Greene in 2008. It was Greene who most vocally kept EMC at arm's length. It's also the case that virtualization is increasingly at the center of everything that EMC does, so how could VMware not be an integral part?
This pervasive virtualization theme carried through to EMC VP Jon Peirce's discussion about EMC's internal IT infrastructure as well. EMC IT is using VMware to virtualize as much as possible. This includes doing database testing on a Cisco Unified Computing System (UCS) in advance of a planned migration off Sun E25000 UltraSPARC-based servers.
An initial Virtual Desktop Infrastructure (VDI) deployment also uses UCS in the form of a vBlock--a preconfigured package that combines products from Cisco, EMC, and VMware. EMC has about 200 users on VDI today and expects to roll out to several thousand next year starting in their Franklin facility. VDI and associated forms of desktop virtualization are a favorite technology of CEO Joe Tucci, who would like to move toward a platform-agnostic client strategy.
The ultimate goal is what sometimes goes by BYOPC (Bring Your Own PC), in which employees provide their own notebook computers, perhaps purchased with the help of a stipend. Even today, many of the EMC execs at the event were sporting Macs, even though IT doesn't officially support them.
Another hot topic at the event was multi-tier storage, in this case automatic storage tiering that intelligently moves data between Flash-based storage and conventional disk drives. EMC's technology here is called FAST and will roll out on Symmetrix V-Max arrays.
Flash drives can be much faster than SATA disks--or even high-performance Fibre Channel drives--but they're also much more expensive on a per-GB basis. The idea behind FAST is to automate the placement of data based on the way its accessed. For example, a database index that is frequently read and written to will migrate to high performance flash while older data that hasn't been touched for a while will move to slower, cheaper disks.
Disks being used to store rarely accessed archival data can even be deduped, compressed, and even spun down to reduce overall data center power consumption. Tape isn't part of this vision; Tucci opined that "Backup to and recovery from tape is dead."
The idea of storage tiering isn't new. Hierarchical storage management (HSM) has been around for well over a decade. However, in practice, it's mostly ended up being about moving old files to tape for archive purposes. (EMC itself has a product in this vein: Legato DiskXtended.) FAST is something more transparent and more dynamic.
There are analogs between FAST and the storage pooling that is part of Sun Microsystems' ZFS filesystem. EMC argues that the function belongs on the storage device rather than the server because the array is where data access from multiple systems and applications come together.
It's unsurprising that EMC wants storage to be at the center of things. This is a company, after all, whose tagline is "where information lives." It is, however, worth remembering that this is a different lens through which to view the world than system vendors tend to choose--and, for that matter, than VMware chose historically.
Cisco Systems, EMC, and VMware announced Tuesday a joint venture to sell a new integrated data center product.
The venture will sell and provide maintenance and service support for the product, which is called V-Block. It will combine EMC's storage equipment, Cisco's virtualized servers and networking equipment, and VMware's virtualization technology.
The deal had been rumored since September, when the Wall Street Journal reported the companies were working on a collaborative effort code-named Alpine. Talk of the deal heated up late last week and early this week.
The joint venture will market and provide maintenance for the product. But the cloud infrastructure will be built by all three companies.
Cisco and EMC already have a partnership to collaborate around Cisco's new data center platform, which the company calls Unified Computing. And EMC owns nearly 85 percent of VMware.
The companies will provide more details about the joint venture during a press call scheduled for 8:30 a.m. PT.
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Cisco Systems, EMC, and VMware are expected to announce this week a new joint venture to sell data center products and services using virtualization technology, according to report in the Wall Street Journal.
The new products called "V-Block" combine EMC's storage equipment with Cisco's new virtualized services and networking equipment along with VMware's virtualization technology.
In September, The Wall Street Journal reported that Cisco and EMC were in talks to form a new services venture code-named Alpine. V-Block may be this same service.
The products will either be sold as an end-to-end solution that companies can install in their own data centers, or customers will have the option of subscribing to a virtualized service, according to reports.
Cisco has been reselling EMC storage gear for years. It also owns a stake in virtualization software company VMware, which operates as a unit of EMC. So it makes sense that the companies would team up on a new services venture.
Earlier this year, Cisco announced a new data center architecture it calls Unified Computing, which includes new virtualized servers. It also includes coordinated support and software integration from partners such as Intel, Microsoft, EMC, and VMware.
Cisco sees the data center market as a multibillion-dollar opportunity. The company anticipates a greater need for storage and high-speed networking within data centers as more services and content come online. Cisco's corporate customers have also begun to virtualize their data centers to make those operations more efficient.
The joint venture will have its own CEO, according to the Journal.
Representatives from Cisco, EMC, and VMware have declined to comment.
The new joint venture is expected to be announced Wednesday before Cisco releases its fiscal first-quarter results.
EMC Chief Executive Joe Tucci said Thursday that customers are "signaling more comfort spending their IT budgets." The company reported better-than-expected third-quarter results.
The storage giant reported earnings of $298.2 million, or 14 cents a share, down 24 percent from the same period a year ago. Revenue was $3.52 billion, down 5 percent from a year ago. Under a non-GAAP basis, EMC reported earnings of $480.3 million, or 23 cents a share, 2 cents better than Wall Street estimates.
Generally speaking, EMC has been well-positioned in the downturn because of a focus on storage, cloud computing, virtualization, and data centers--hot areas in enterprise IT.
Read more of "EMC: Customers have 'more comfort' about IT budgets" at ZDNet's Between the Lines.
Earlier this week, EMC revealed that it has attracted longtime Intel executive Pat Gelsinger to run its storage business.
Gelsinger is set to become president and chief operating officer of EMC's Information Infrastructure Products (virtually all in EMC's product group except VMware), including the Enterprise Storage Division, RSA Information Security, Content Management and Archiving, and Ionix IT Management. His direct reports will be Frank Hauck, who now leads ESD, Mark Lewis of CMA, Art Coviello of RSA, and Jay Mastaj of Ionix.
A Wall Street Journal blog post quotes Gelsinger as ultimately wanting to be Intel's president, but that wasn't something that was going to happen anytime soon. In that the move is effective immediately, Gelsinger will likely not be a keynote speaker at the Intel Developer Forum, as originally planned.
Pat Gelsinger
(Credit: Intel)Gelsinger is an interesting acquisition for EMC, as it diversifies its way toward encompassing more and more traditional IT infrastructure products and services, as well as IT virtualization and emerging cloud-computing models. His chip geek credentials are solid. He wrote the book on programming the 80386, and he designed the original 486 processor. At EMC, he will move to bring to market products based on a tighter integration between existing product lines, as well as those from VMware and some key partners (read Cisco Systems).
While Gelsinger is a hard-driving executive, he reveals an actively spiritual side of himself in his book "The Juggling Act: Bringing Balance to your Faith, Family, and Work."
While the Gelsinger move seems to have attracted the most media attention, there's way more to this story. As part of the executive personnel announcement, Howard Elias was promoted to president and chief operating officer of information infrastructure and cloud services at EMC.
Previously, Elias was president of EMC Global Services and EMC's Ionix IT management group. He will now be responsible for all of EMC's service groups, including those attached to the products groups. Elias also gets to champion EMC's moves into cloud services.
For me, the hidden word here is "services." IBM spawned IGS. HP bought EDS. There's a void here that I think Elias has to fill. Can Elias give EMC a services powerhouse? Can he successfully blend the more traditional IT services with the newly emerging cloud-computing models? As I see it, those are Elias' challenges.
What's going on at the top? First, Tucci believes that the current executive management structure needs to be enhanced and expended, as it progresses from $14 billion in annual revenue to a $20 billion to $25 billion IT infrastructure company capable of competing with the likes of IBM and Hewlett-Packard. Hence the division of responsibility along the line of products vs. services.
The Wall Street Journal reports that Tucci has, with this new management structure, set up something of a three-way, three-year competition to become his successor, as Tucci also announced that he plans to remain president and CEO through 2012. Now in the running, according to the Journal report, are Gelsinger, Elias, and David Goulden, EMC's current executive vice president and chief financial officer.
Tucci is certainly laying his cards on the table for Wall Street to see, and Wall Street appears to like the move, pushing EMC shares upward over the last week. His latest moves help discourage rumors that EMC is in play as a takeover candidate.
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Intel has reorganized its upper management, and one executive, Pat Gelsinger, is taking a new high-profile role at storage and software company EMC, the companies announced Monday.
Gelsinger, 48, had been a major figure at Intel, where he worked for 30 years. Among his roles: chief architect of a flagship chip from the 1990s, the 486 that followed the 386 and preceded the Pentium; the company's first chief technology officer; and most recently co-general manager of the Digital Enterprise Group, which brought in more than half of the chipmaker's revenue selling chips for servers and business PCs.
Pat Gelsinger speaking in 2007
(Credit: Stephen Shankland/CNET)At EMC, Gelsinger will be president and chief operating officer of the Information Infrastructure Products group, reporting to Chief Executive Joe Tucci and overseeing the company's businesses in storage, security, content management and archiving, and IT management.
"The technology industry has undergone almost incomprehensible change over the last three decades since I entered it," Gelsinger said in a statement. "The rate and pace of change and challenge is not abating in the slightest. EMC is extremely well positioned to play a pivotal role in the IT industry for decades to come, and I am privileged to join Joe and his EMC leadership team in that endeavor."
At Intel, all major product divisions now are part of the new Intel Architecture Group led by two executive vice presidents, Sean Maloney and Dadi Perlmutter. Maloney will lead business and operations; Perlmutter will oversee product development. Maloney had been head of sales, a role now filled by Tom Kilroy, who previously was the other co-manager of the Digital Enterprise Group along with Gelsinger.
"In making the changes, Paul Otellini, Intel's chief executive, will devote a higher quotient of his time to corporate strategy and driving the company's growth initiatives," Intel said in a statement.
In addition, the Technology and Manufacturing Group now will report to Chief Administrative Officer Andy Bryant, freeing Chief Executive Paul Otellini for more strategic work. That group's leadership under Bob Baker, Bill Holt, and Brian Krzanich is unchanged, Intel said.
Intel's general counsel, Bruce Sewell, also is leaving the company. Deputy General Counsel Suzan Miller is now interim general counsel, Intel said.
"We thank Pat and Bruce for many years of service to Intel and wish them well in their future endeavors," Otellini said in a statement.
Gelsinger's arrival isn't the only change at EMC. In addition, Howard Elias, 52, is now president and chief operating officer of EMC's Information Infrastructure and Cloud Services group. Previously he'd been president of the company's global services work and its Ionix IT management group.
In addition, EMC announced Monday that Tucci told the company's board of directors he plans to remain chairman and CEO through 2012.
The New York Times had reported Gelsinger's departure and the Intel reorganization, while The Wall Street Journal had reported his arrival at EMC.
Networking giant Cisco Systems and storage area networking company EMC may be teaming up to form a new joint venture to provide technology services to big companies, the Wall Street Journal reported Thursday.
Citing unnamed sources who have been briefed on the plans, the Journal story said the new joint venture, code-named Alpine, would target large businesses and would focus on installing Cisco server and networking gear and EMC storage equipment into data centers.
It's unclear when the joint venture might be announced, according to the newspaper. So far, Cisco has declined to comment on the speculation. And an EMC spokesperson provided a statement to the WSJ reiterating that the companies have always been close partners and will continue to be in the future.
Indeed, Cisco has been reselling EMC storage gear for years. Cisco also owns a stake in virtualization software company VMware, which operates as a unit of EMC. So it makes sense that the companies would team up on a new services venture.
What's more, Cisco has been making a big push into the data center market. Earlier this year Cisco announced a new data center architecture it calls Unified Computing. This new architecture includes new hardware from Cisco, namely blade servers, an interconnection "fabric," a chassis for the blade servers, fabric extenders and network adapters. It also includes coordinated support and software integration from partners such as Intel, Microsoft, EMC, and VMware.
Cisco sees the data center market as a multibillion-dollar opportunity. The company anticipates a greater need for storage and high-speed networking within data centers as more services and content come online. At the same companies are starting to virtualize their data centers to make those operations more efficient.
Cisco and EMC each already have service businesses of their own. EMC generated about $4.8 billion in revenue in 2008 from its services business, according to the Wall Street Journal. This was about 32 percent of the company's overall revenue.
The Journal also said that Cisco's services business generated about $7 billion to the company's coffers in fiscal 2009, which was about 19 percent of total revenue.
Most of the services that Cisco provides are for products that have already been sold. But the new joint venture would be different because it would entail designing and implementing products to fit into a data center. And as data centers become more complex, it makes sense that Cisco and EMC would want to develop a service to help customers design a data center that would use their products.
Traditionally, Cisco has relied on partners such as Hewlett-Packard and IBM to provide these services and help sell its gear to customers. But with the introduction of Cisco's new data center server products, Cisco's partners are looking more like competitors.
The move to create a services business looks to be part of Cisco's overall strategy to diversify its business. The company's bread and butter remains providing routers and switches to large companies and service providers to power the Internet. But over the past couple of years the company has begun to move aggressively into new areas like IP telephony, videoconferencing, and consumer electronics and home networking gear.
Cisco has also dipped its toe into other services markets. For example, with the acquisition of WebEx, the company now offers corporate users a hosted collaboration service. It has also recently launched a hosted Web service it calls Eos that allows media and entertainment companies to create, manage, and grow online communities by providing tools to create Web sites.
This was originally posted at ZDNet's Between the Lines.
EMC reported better-than-predicted results for the second quarter and upped its outlook for the remainder of the year.
The company said that IT budgets have stabilized and customers are more confident about their visibility.
The storage giant on Thursday reported net income of $205.2 million, or 10 cents a share, on revenue of $3.26 billion, down 11 percent from a year ago. On a non-GAAP basis, EMC reported earnings of 18 cents a share.
Wall Street was expecting earnings of 16 cents a share on revenue of $3.2 billion.
EMC also raised its outlook. The company now projects 2009 earnings of 51 cents a share and non-GAAP earnings of 82 cents a share. Wall Street expects 78 cents a share of non-GAAP earnings.
On the revenue front, EMC now projects 2009 sales of $13.8 billion compared with previous estimates of $13.5 billion. Data Domain, whose acquisition closes Thursday, will contribute $200 million in revenue for 2009 and will be neutral to non-GAAP earnings. On a net basis, the Data Domain amounts to a less than 2 cents a share impact.
Meanwhile, third quarter revenue is expected to rise 2 percent to 3 percent sequentially excluding Data Domain results. Data Domain's inclusion results in sequential growth of 4 percent to 5 percent.
In a statement, CEO Joe Tucci said that EMC expects the company to generate double-digit revenue growth rates "when IT markets resume to (a) more normal spending rate." For now, EMC will focus on gaining share in the hottest markets: data centers, cloud computing, virtualization, and storage.
The fight to win Data Domain is over.
EMC and Data Domain announced Wednesday that the two have entered a definitive merger agreement. EMC will buy Data Domain for $33.50 a share in cash, a deal worth $2.1 billion.
Data Domain's board said it determined that EMC's offer was "advisable, fair to and in the best interests of Data Domain and its stockholders." The board is recommending that Data Domain investors tender their shares to EMC.
EMC was determined to buy Data Domain by continually outbidding NetApp over the past five weeks and is now focused on the next steps.
"We look forward to bringing Data Domain together with EMC to form a powerful force in next-generation disk-based backup and archive," EMC CEO Joe Tucci said in a statement. "I have tremendous respect for Data Domain's people, technology and business, and anticipate great things ahead for our respective companies, our customers and partners."
NetApp said it would not change its bid for Data Domain and that the two companies have ended their merger agreement. Data Domain also canceled the special stockholder meeting set for August 14, at which time investors were to vote on the NetApp proposal.
"NetApp applies a disciplined approach to acquisitions, ones focused intently on creating long-term value for our stockholders," Dan Warmenhoven, NetApp's CEO, said in a statement. "We therefore cannot justify engaging in an increasingly expensive and dilutive bidding war that would diminish the deal's strategic and financial benefits."
NetApp gets a concession prize, though--a $57 million break-up fee from Data Domain.
The bidding war was brief but active. On May 20, NetApp bid $25 a share to acquire Data Domain in a stock and cash deal worth $1.5 billion. In early June, EMC upped the ante with a $30-per-share cash offer, forcing NetApp to boost its bid to match. However, EMC promoted its deal as superior because it didn't contain some of the contingencies of NetApp's proposal.
Data Domain seemed intent on choosing the NetApp bid, prompting a couple of lawsuits against the company over its failure to consider EMC's offer.
Finally, on Monday EMC upped its price to $33.50 per share, which proved to be the winning bid.
EMC has proven tenacious in trying to outbid NetApp in the battle to buy Data Domain. But NetApp isn't going down without a fight.
After Monday's announcement that EMC had upped its offer for Data Domain to $33.50 a share, NetApp countered with two responses, the first noncommittal but the second quite clear.
The first word from NetApp:
"In response to EMC's revised, unsolicited offer, the NetApp Board of Directors will carefully weigh its options, keeping in mind both its fiduciary duty to its stockholders and its disciplined acquisition strategy," Dan Warmenhoven, chairman and CEO of NetApp, said in a statement. "We will provide an update shortly."
That update came later Monday as NetApp affirmed its intention to acquire Data Domain, still asserting its bid as "superior." The company also announced that the Securities and Exchange Commission has declared NetApp's offer as effective, clearing the way for a shareholder vote.
Additionally, the Federal Trade Commission has granted the merger agreement early clearance. This means the FTC will not conduct any further reviews of the merger, allowing NetApp's acquistion of Data Domain to close on a timely basis if approved by stockholders.
"We are pleased to have passed these important milestones, which we believe set us on course for a clear and timely path to close," said Warmenhoven. "We continue to believe that our offer is superior to the unsolicited offer from EMC."
Data Domain's board has set up a special stockholder meeting for August 14 to vote on the merger.
The fight to own Data Domain started on May 20 with NetApp's original offer of $25 per share. In early June, EMC volleyed with a higher per-share bid.
Despite lawsuits against Data Domain over the agreement with NetApp, the two companies seemed determined to complete their deal. Now the ball is back in EMC's court.
