Watch Out for WAFS

Wide-area file services, that is - a booming niche, suppliers claim

April 15, 2004

4 Min Read
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A handful of vendors say life is good if you're into WAFS -- wide-area file services. But even as fresh funding, new partners, and acquisition prospects emerge, challenges remain and competition's getting tougher.

WAFS suppliers aim to overcome lags encountered when sending files to remote sites using traditional file protocols, such as NFS for Unix and CIFS for Windows. They offer specialized software that deploys caching and other mechanisms to centralize files and offer bidirectional access (read/write) to multiple remote sites.

The roster of players includes Actona Technologies Inc., Riverbed Technology Inc., Signiant Corp., and Tacit Networks Inc., who say business is booming.

All have news:

  • Actona just got $10 million in new funding, bringing its total to $23 million (see Actona Attracts Additional $10M). The company plans to release additions to its ActaStor file caching appliances and make its first partnership announcement "shortly," according to VP of marketing John Henze.

  • Riverbed, which started life as NBT Technology Inc. (see NBT Technology), plans to release its Steelhead "WAN optimization appliances" later this month. Riverbed got $10 million in Series B funding in January, bringing total funding to $16.6 million.

  • Signiant, which spun out of Nortel Networks Ltd. (NYSE/Toronto: NT) as an application service provider (ASP) in 2000 but subsequently became a product-peddler, is planning to unveil a new release of its Mobilize file sharing software in early May. Also set for announcement is a series of specialized applications that will add backup, archiving, and inventory to the basic Mobilize functions.

  • Tacit is closing its Series B round within the next couple of weeks, for an amount "great than" its original $7.3 million (see Tacit Makes Funding Explicit), according to VP of marketing Noah Breslow. The company, which has 38 employees and claims 17 customers, also is at work on products that incorporate features of AttachStor, whose intellectual property and patents Tacit bought in March 2004 (see Tacit Attaches Patent Portfolio). The result, a product that caches email attachments, is planned for 2005.

The above are by no means the only players in this space. One vendor, DiskSites Inc., seemed to have fallen below the radar, but it's set to re-emerge under a new name and identity within the next couple of weeks, according to a spokesman. The new company will compete with other WAFS startups but have a slightly broader charter.Despite all the good news, threats remain. After all, the WAFS road is strewn with the carcasses of startups with similar aims that didn't fare as well, including Acirro (see Acirro Hits Zero), Storigen (see Storigen Ends With a Whimper), and Zambeel (see Zambeelians Reemerge at StorAD).

Defunct startups did several things wrong, sources say. Basically, they lacked one or more of the elements now seen as vital to WAFS advancement, including the following:

  • Support of IP. Most WAFS products can run over Internet links as well as dedicated connections. In the past, file sharing products often required dedicated connections, or only worked with certain routers.

  • File centralization. Some old WAFS gear didn't use a centralized server model, which lets enterprises cut down on the amount of software and hardware required to support remote users. Distributed file sharing is definitely outr.

  • Performance. WAFS suppliers have features that cut down on repetition in file delivery on both the server and over the remote connection, which speeds up the link. According to Arun Taneja of the Taneja Group consultancy, the goal is to deliver files over the WAN as fast as they appear on the LAN. Anything less isn't cutting it.

  • Security. WAFS products come with encryption and other security features, which can act as adjuncts to a company's own hardware-based security.

  • Broad market appeal. When it comes to WAFS, more is merrier. Companies that tried to cater to specific segments or vertical markets, such as video service providers, are pushing up daisies.

The current crop of WAFS vendors say features like those above give them a winning hand. But more will be needed to bring them to the next level -- including acquisition or public offering.

Partnerships are key, and all the vendors are working in that area. Some already have coveted OEMs: Signiant, for instance, says its full-year 2003 revenues exceeded those of 2002 by 100 percent, thanks in part to its OEM partnership with EMC Corp. (NYSE: EMC) (see Signiant Wins EMC's Love). Tacit has an OEM deal with BlueArc Corp. and has arranged for IBM Corp. (NYSE: IBM) to resell its wares in Europe.

On the downside, partners are fickle (EMC looked over Actona, DiskSites, and Tacit before hitting on Signiant all the way back in 2002). Exclusivity isn't guaranteed, either. Ultimately, there may not be room for more than one or two vendors to hit it really big. But we know of at least four that won't stop trying.— Mary Jander, Site Editor, Byte and Switch

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