The biggest news of the week is of course the fact that EMC has bagged Data Domain, beating out rival NetApp with its superior bid of 2.1 billion, or $33.50 a share. The news itself broke yesterday, July 8, and the Wall Street Journal is reporting that tech stocks rallied today as a result of the acquisition. This truly is an exciting time for the storage industry in general and the data reduction piece of it in particular.
Analyst Steve Duplessie was one of the first out of the gate with the insta-analysis on the merger. In his post-mortem of the battle between storage titans for the dedupe pioneer, he lays out a pragmatic view of what motivated each of the three parties.
Writes Steve: “NetApp originated this deal for one simple reason (no, not because there is a secret Dutch society of zillionaires) - opportunity.”
Steve also takes the view that NetApp is under no pressure to acquire a different dedupe vendor as a consolation prize. In fact, he predicts that its next acqui will be in another space entirely.
Perhaps, but many are saying that the dedupe space is simply too hot to ignore. As Greg Schulz of Storage IO told SearchStorage: “I believe NetApp needs to do something similar, and go and get CommVault or somebody else in the data management space. NetApp needs to do something that will make people say, ‘That’s a smart move letting go [of Data Domain], and that’s a smart move that you’re pursuing.’”
On GigaOm, analyst Juergen Urbanski makes the argument that by losing Data Domain, NetApp is now out of the loop on two of the “mega trends” in storage: unified computing, and the move towards more storage efficiency through virtualization, cloud computing, data reduction and so on.
Of course, only time will tell what NetApp’s next move will be–and this is a company that is known for its surprises. And let me be one of the first to congratulate EMC on its acquisition. Their track record indicates that this will be a great success on all fronts.
