NetApp Annexes Alacritus

Network Appliance Inc. (Nasdaq: NTAP) will pay $11 million to acquire Alacritus Software Inc. and bring two emerging disk backup technologies into its portfolio (see Netapp Acquires Alacritus).

NetApp executives have identified disk-based backup as one of the fastest growing areas of network storage. By buying Alacritus, NetApp picks up virtual tape library (VTL) and continuous data protection (CDP) expertise. NetApp expects the Alacritus deal to close by the end of the month.

Quick review: VTLs write data to disk in the same format used for tape backups, but the backup and recovery speeds are faster. CDP products continually record data changes and store only the changes. CDP also allows recovery from any point in the past instead of only at fixed intervals.

Amit Pandey, VP of NetApps enterprise disk unit, says NetApp is interested in both of Alacritus’s product lines, though Alacritus was more advanced along the VTL front with its Securitus product. NetApp has resold that product since December with its storage systems (see Alacritus, NetApp Deliver Virtual Tape).

Pandey says NetApp will make a few tweaks to Securitus after the deal closes “to make it look and feel like a NetApp product," though what NetApp will name it hasn't been determined. NetApp will then look at exactly how it can bring its own technology to the VTL space, he says.NetApp's new VTL product will directly compete against the Clariion Disk Library that EMC Corp. (NYSE: EMC)launched last year (see EMC and HP Spin Disk). Other VLT vendors include Advanced Digital Information Corp. (Nasdaq: ADIC), Diligent Technologies Corp., Fujitsu Siemens Computers, Sepaton Inc., and Quantum Corp. (NYSE: DSS).

Alcritus also has a CDP product called Chronospan (see Alacritus Debuts Continuous Backup). Pandey says NetApp is intrigued by CDP but doesn’t consider Chronospan ready for market yet. “One of the reasons we like Alacritus is their thinking around CDP,” he says. “Right now we’re evaluating it, seeing how it fits in customer environments and the best way to bring it to market. The product needs more development.”

Vendors with early enterprise CDP products include Mendocino Software, Revivio Inc., and TimeSpringSoftware Corp.

Pandey says NetApp hopes to keep most of Alacritus’s 20 employees and will maintain the startup’s Pleasanton, Calif., office. He says the Alacritus crew will be “quite independent,” but it is too soon to say what role Alacritus CEO George Wilson or the other founders, Don Trimmer and Roger Stager, will play at NetApp.

Although Alacritus was among the early players in VTL and CDP, industry sources say the startup did a poor job of marketing and kept a low profile since it was founded in 2000. The low acquisition price suggests Alacritus hasn’t rung up a lot of sales.“Alacritus was dead in the water without some help,” says analyst Arun Taneja of the Taneja Group. “They had absolutely no traction in the general market, but it will be interesting to see it in the hands of NetApp.”

Pandey says Alacritus has “enough customers to peak our interest” but didn’t know how many. He concedes marketing wasn’t the startup’s strength. “Their focus has been primary engineering. Their technologists are extremely capable.”

The acquisition comes one day after IBM said it would OEM NetApp’s NAS and iSCSI products. Pandey says it is too early to say whether the OEM deal will include the VTL and CDP products.

— Dave Raffo, Senior Editor, Byte and Switch