IBM Confirms Diligent Acquisition

IBM has purchased de-dupe specialist Diligent, which will become part of the System Storage business unit of the IBM Systems and Technology Group.

IBM did not disclose terms of the deal, but reports in the Israeli media, where acquisition rumors first emerged last month, claim IBM paid $200 million to acquire Diligent.

IBM spokesman Charles Zinkowski says IBM will retain all of Diligent's employees in their present headquarters in Framingham, Mass., as well as in R&D facilities in Tel Aviv. Diligent CEO Doron Kempel will stay on board, reporting directly to Cindy Grossman, VP of tape and archive for System Storage.

Last week, IBM threw down a rumored $90 million for Israeli CDP specialist FilesX, dovetailing with its attention to de-duplication.

Up to now, IBM has been relatively quiet on the subject of de-dupe, although there was chatter last year that the vendor was eyeing its VTL partner and de-dupe specialist FalconStor as a possible acquisition target.The Diligent acquisition will not affect other storage vendors that use the startups flagship ProtecTier software, IBM says. Diligent has reseller deals with Overland, HDS, and Sun.

"There is no impact on those agreements. It's business as usual," said IBM's Zinkowski.

Diligent, which was formerly EMC's Israel R&D lab, already had links with IBM prior to the acquisition.

Diligent co-founder and board director Moshe Yanai is also executive chairman of Israeli clustering startup XIV, which was bought by IBM for a rumored $350 million earlier this year.

Although traditionally focused on high-end enterprises, Diligent launched a midrange version of ProtecTier last year and is planning to extend its reach into remote offices with the launch of a replication offering later this year.Diligent, which raised around $47 million in funding since it was spun out of EMC in 2002, is also getting some big-name customer wins. The vendor lists the Union Pacific Railroad, Czech car manufacturer Skoda Auto, and Japanese technology giant Sharp amongst its customers, though it has not yet published any financial figures.

Storage was one of the highlights in IBM’s first quarter results, released this week. The vendor’s overall storage revenues rose 10 percent year-over-year, with sales of IBM’s DS8000 systems rising 17 percent and tape up 18 percent.

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