EMC Pounds ILM Pulpit

EMC Corp. (NYSE: EMC)is leveraging partnerships and acquisitions to become a one-stop shop for storage networking. And its battle cry in this campaign is the king of all buzzwords: "Information Lifecycle Management" (ILM).

EMC today announced it is turning technology acquired in a partnership with OuterBay Technologies Inc. in December 2003 into an ILM partnership with Oracle Corp. (Nasdaq: ORCL). (See EMC Puts OuterBay Inside.) EMC also is exploiting a relationship with consulting firm Accenture established in July 2002 to provide services to help companies manage and protect data (see EMC Services Tap Rivals' Hardware).

The announcements highlight EMC's seriousness about the new trend toward ILM, which translates into vendors' offering as wide a range of storage networking products as possible, using services that take the product selection process out of customers' hands.

Indeed, the ILM battle is shaping up to be a vicious and protracted one in the industry, and EMC's taking the gloves off to enter the fray. Besides today's announcements, the company plans press statements this week about how EMC's Legato products have replaced ones from Veritas Software Corp. (Nasdaq: VRTS) and other vendors in specific enterprise accounts.

The software element of ILM is key for EMC, traditionally a hardware player. EMC spent $3 billion for software providers Legato and Documentum last year, which enabled the company to handle unstructured data in ILM applications (see 2003 Top Ten: Mergers & Acquisitions). But a hole remained in its ILM strategy: the ability to handled structured data stored in enterprise databases.Thats where the OuterBay software comes in. Its new suite, which EMC calls Database Xtender, includes a tool to monitor and analyze database growth patterns; another to identify and relocate inactive data from primary to secondary storage; and a third that parses unnecessary data to save capacity. An archiver piece of the suite is expected by midyear.

The software suite is the key component of a joint services agreement between EMC and Oracle Consulting to help Oracle customers migrate inactive database records onto more cost-effective storage.

Clint Vaughan, EMC’s director of technology strategy, says the suite helps solve capacity and data movement challenges without adding hardware. “People will typically throw more hardware at the problem and use databases to do more tuning,” he says. “That’s like pushing a rock up a hill. You’re just making incremental changes.”

Vaughan says support for other databases besides Oracle will become available later this year.

New services offered by EMC’s Technology Solutions division come from a consulting group formed together with Accenture two years ago. The new services include ILM workshops, four-to-six-week assessment services, and onsite managed services.EMC is battling services organizations from IBM Corp. (NYSE: IBM) and Hewlett-Packard Co. (NYSE: HPQ), as well as competition from the likes of Storage Technology Corp. (StorageTek) (NYSE: STK) and Network Appliance Inc. (Nasdaq: NTAP), which also are adding partnerships and acquisitions to build ILM strategies of their own.

StorageTek, for instance, is remodeling itself from purely a tape vendor to an overall storage company (see Pat Martin, President & CEO, StorageTek). NetApp, EMC’s major NAS competitor, today announced it would incorporate an enterprise content management package from IXOS Software AG (Nasdaq: XOSY) with its SnapLock software.

All the hardware and software maneuverings are just part of the ILM picture. Services -- meaning consulting to help companies install and maintain storage applications -- are becoming the key differentiator for ILM. After all, what better way to get one's products into an account than to take charge of what the customer installs?

And analysts think customers need lots of help with storage problems. “If you’re going to do ILM, you can’t just say, ‘Here’s hardware, here’s software, have at it,’ ” says Steve Berg, senior research analyst at Punk Ziegel & Co.. “You need services.”

EMC clearly sees services as key to getting its ILM products into as many accounts as possible, and it's rabid about glomming on -- which may help it in what's shaping up to be a major competitive fray. “When it comes to ILM and the whole package, we’re in the best position,” crows Derrell James, VP of EMC's Technology Solutions group. “[ILM's] our main focus. Our whole strategy and vision is on ILM. We have far more focus than [competitors] do.”EMC's commitment to ILM was underscored last Thursday when it announced a $40 million deal with the Pentagon on the same day as it reported net income of $220 million for the fourth quarter (see EMC Wins $40M Pentagon Contract and EMC: Everything's 'Better'). EMC President Joe Tucci boasted that EMC's “crisp execution against our information lifecycle management strategy” would propel the company to a strong 2004.

Of course, everyone else in storage networking is hoping for the same. Bottom line? Expect more ILM coups.

— Dave Raffo, Senior Editor, Byte and Switch