Hardware Roots: EMC Still Has A Stake In Systems - InformationWeek

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2/25/2005
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Hardware Roots: EMC Still Has A Stake In Systems

'They know the hardware is becoming a commodity,' Yankee Group analyst Balaouras says. 'It's never going back to hardware over software and services.'

Four years ago, EMC Corp. had 24,100 employees, most of them working on its storage hardware and management software, such as the Symmetrix Remote Data Facility. Today, EMC has about 22,000 employees, more than 11,000 of them in its services and software groups, which includes content-management and backup-and-recovery software but not EMC-specific storage-management offerings.

The ramp up in software and services professionals includes individuals who came aboard with EMC's various acquisitions over the last couple of years, and it speaks to how EMC is evolving as a company. "They know the hardware is becoming a commodity," Yankee Group analyst Stephanie Balaouras says. "It's never going back to hardware over software and services."

That doesn't mean EMC is abandoning the hardware business it grew up in. It's planning a new version of its high-end Symmetrix hardware for the middle of the year but won't disclose details yet.

EMC sees more opportunity for hardware sales in the small- and midsize-business market, too, and this month, the company introduced low-cost Clariion storage systems that operate over the iSCSI protocol on IP networks. Sales of its midrange Clariion systems grew 44% year over year from 2003 to 2004. Both EMC's Celerra NAS, a network appliance that processes files faster than a general-purpose server, and its Centera content-addressable storage, which secures data by storing content by topic and requiring users to have a "key" to unlock the code assigned to that data, saw double-digit year-over-year revenue growth.

Other new offerings include a storage-network-virtualization device that uses EMC software and switches from Brocade, Cisco Systems, and McData. It's due in the second quarter and is aimed at increasing storage-network performance inexpensively.

Grid computing has EMC's interest, too. Last year, EMC joined with Dell, Intel, and Oracle to form Project MegaGrid to design, test, and document industry-standard best practices for building grid infrastructures. In January, the company hired Ian Baird, an executive at grid-computing middleware company Platform Computing. EMC will say only that Baird has joined the Office of Technology to help shape EMC's technology and standards strategy.

Return to main story: EMC Wants Your Data

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