Donatelli Finally Joins HP, But Can't Work on Storage (Yeah, Right)

After 22 years at EMC, David Donatelli is now an employee of Hewlett-Packard. HP got its man, but it (legally) won't be able to make use of his storage expertise for a year. So Donatelli, one of the top storage executives in the industry will have to spend his time learning about and working on servers and networking equipment, delaying HP's plans to put together a business unit under a single leader that can sell integrated packages of servers, storage and networking gear for enterprise data centers.

A Massachusetts state court modified an earlier court order on Tuesday and allowed former EMC executive Donatelli to join HP, but he won't be allowed to work on storage initially. HP issued a statement that said Donatelli began work at the company after the order was entered by the Suffolk County Superior Court.

"Donatelli will serve as executive vice president of Enterprise Servers and Networking," HP said. "Due to certain restrictions in the court's most recent order, Dave Roberson, senior vice president and general manager of the StorageWorks division, will report directly to Ann Livermore, executive vice president of the Technology Solutions Group at HP, until the order is lifted. HP is pleased with the court's recent decision and looks forward to the contributions Donatelli will make to HP's business."

The StorageWorks division was suppose to supervised by Donatelli and become part of the server and networking business unit.

EMC said it was pleased that the court upheld parts of the non-compete agreement that were part of Donatelli's employment contract with EMC. "The judge has entered an order as proposed by EMC that precludes Mr. Donatelli from being engaged in any aspect of HP's business that overlaps or competes with EMC's storage business for a 12-month period," an EMC spokesman said, according to a story by the Reuters wire service.

HP announced last month that it had hired Donatelli, president of EMC's storage division, to lead a business unit that would encompass servers, networking and storage systems. The move was viewed as a way for HP to strengthen its storage business and better compete with Cisco Systems, which in March announced plans to expand its data center offerings and begin selling blade servers, putting it in competition with server partners like HP, Dell, and IBM. Cisco is partnering with storage vendors like EMC and NetApp to offer a full menu of data center infrastructure systems.

That move by Cisco set the stage for what industry analysts said would be a major battle among large infrastructure vendors looking to sell packages of servers, storage, and networking systems to large enterprises. The recent announcement by Oracle that it will buy Sun Microsystems for $7.4 billion added another competitor to the fray.

Donatelli was to have report to Ann Livermore, executive vice president of the Technology Solutions Group at HP. At EMC, Donatelli reported to Joe Tucci, the company's chairman, president, and CEO. Donatelli's storage business contributed about three-fourths of EMC's $14.9 billion in revenue last year. At the time of the announcement, HP also said it was adding its ProCurve Networking business to Donatelli's portfolio.

HP and EMC immediately filed lawsuits against each other and EMC won an order prevent Donatelli from joining HP on May 5 as originally planned. The revised order issued this week seems to have put a temporary halt to that legal dispute.

So, raise your hands if you think that Donatelli won't be giving advice (orders?) to Roberson about future plans for products and strategies for the HP StorageWorks divisions.

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