Data Domain, the latest storage vendor to move toward an IPO, has signed a deal with Quantum to avoid de-duplication lawsuits. (See Data Domain Files S1 and Storage Bubble Wrap.)
Tucked away within Data Domain's S-1 filings are details of the cross-licensing deal, which centers on the vendors' respective de-dupe technologies. Both firms use a de-duplication technique called "variable length," which accommodates changes in patterns of data such as bytes or characters, as opposed to checking for "fixed length" packets of data.
Data Domain was unwilling to provide additional data on its S-1, although the deal has more to do with avoiding courtroom drama than building new products, according to Quantum spokesman Brad Cohen. "It's essentially giving [both companies] more flexibility to develop products without worrying about patent infringement and getting into a legal issue," he says.
At this stage, the firms have no plans to develop products together, says Cohen. "This is just so that if each company wants to license the other's patents, they can do so under this agreement."
Resolving patent infringement lawsuits can be a major distraction for technology firms, particularly those in emerging markets. (See Patently Profitable and Crossroads, Dot Hill Ponder Patents.) "Unquestionably it would have derailed the Data Domain IPO," says Arun Taneja, president of analyst firm Taneja Group. "De-dupe is at the core of data domain's product -- it's the essence of the company."