DataDirect Scopes Out SSDs

Solid state disks and a possible IPO are all on the vendor's roadmap

July 12, 2008

3 Min Read
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SAN specialist DataDirect Networks is planning to add solid state disk (SSD) technology to its S2A hardware later this year, and, despite a tough economic climate, is still working toward its IPO.

SSD is the next natural extension to the concept of tiering,” says Alex Bouzari, the Data Direct CEO, explaining that the vendor will offer SSDs sometime in the fourth quarter. “We will have a tier zero, which is SSD, a tier one, which is SAS, and a tier two and tier three, which is SATA.”

The exec would not reveal whether DataDirect will use Flash or DRAM-based SSDs, although he confirmed that the vendor will likely finalize its plans within the next 45 days.

DataDirect’s rival EMC has already added Flash-based SSDs from STEC to its Symmetrix system and Sun recently jumped on the solid state bandwagon, announcing plans for its own Flash memory SSDs.

Other focus areas for DataDirect are cloud storage and Web 2.0.“We will be making some product announcements towards the end of this year for Web 2.0 application enablers,” says Bouzari, but refused to reveal specific details. “If we can move up into the application layer and tie into it better, we can help our customers’ networks become much more effective.”

The vendor will also be making announcements around cloud storage around the same time, but again, refused to reveal specifics.

DataDirect was more forthcoming on its IPO plans, despite an increasingly difficult economic climate, which is hardly conducive to tech sector public offerings.

“We’re targeting an IPO in the next six to twelve months, as soon as the market improves,” says Bouzari. “The company has been operating profitably for the last five years now, it’s just about the market stabilizing so that we get the right value for the company.”

The CEO explained that DataDirect exceeded $100 million in revenue last year, which was up from $25 million just four years earlier.“Since we’re in a position where we’re generating cash, as opposed to burning cash, we don’t need to do [an IPO] ASAP,” he says, adding that Data Direct has been profitable for the last five years. “We felt that it was very important for us to build a business model that would get us to profitability quickly.”

At least one analyst feels that DataDirect is in a stronger financial position than other recent storage IPOs, but warned that it could be some time before the markets improve.

“There are certain companies, like Compellent, and 3PAR, that didn’t have the degree of profitability that DataDirect does,” says the financial analyst, who asked not to be named. “[But] there are a lot of problems with the economy, from oil prices, to housing – who knows when it will all be behind us?

DataDirect initially focused its attention on the HPC and rich media markets when it began shipping products in 2000, although the vendor shifted its focus five years later onto unstructured data for the likes of the Internet, gaming, and oil and gas industries.

The vendor has 270 employees, although Bouzari told Byte and Switch that this number could reach 370 within 12 months, with most of the new hires in sales and marketing. “The focus is access to market, and just having more feet on the street," he says.DataDirect has over 1,000 customers, around half of whom are in the broadcast sector. Big-name users of the S2A technology include social networking Website, Ferrari, and Xbox Live, which is using the hardware to support an online gaming community of 10 million people.

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  • Compellent Technologies Inc.

  • DataDirect Networks Inc.

  • EMC Corp. (NYSE: EMC)

  • Sun Microsystems Inc. (Nasdaq: JAVA)

  • 3PAR Inc.

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