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IBM To Acquire Storwize?

Rumors have it that the Storwize may be the next Israeli storage player to become part of the IBM portfolio. According to a report in Haaretz, the Israeli daily, Storwize is in talks with IBM for an acquisition to the tune of $140 million. The deal is expected to close by end of July. Storwize officials declined to comment. If successful, Storwize will be the second Israeli storage startup to be acquired by IBM in three years.

Back in 2008, IBM purchased XIV, an Israeli startup, that allowed IT to aggregate up to 120 SATA drives into a single, primary storage system. That move drew rants from competitors employees such as Barry A. Burke  and Marc Farley, and raves from proponents .

The acquisition of Storwize will give IBM a real-time storage optimization engine. With the company's Random Access Compression Engine (RACE), incoming files are placed in a file envelope where attributes such as access control lists, permissions and file size are all identified and stored within the file envelope on the disk. The compressed data is stored in logical units. Should edits need to be made to files, they are made to the logical units negating the need to decompress/restore all the data just to make one edit. This can represent a significant time savings during write updates while also preserving compression ratios in downstream processes such as backup and deduplication.

The acquisition could be critical for IBM. Storage costs remain top of mind for enterprise IT managers. With inline, real time compression, IBM will get an engine that will allow them to lower storage costs across their platforms. Cutting storage usage will have other benefits as well. "For any technology, once you manage to be successful with the performance issue , you can use less storage for the same data, which can have a dramatic effect on cost and environmental issues, like footprint, power consumption and cooling ," says Ofir Zohar, the former CEO of XIV.

Zohar couldn't comment directly on the  IBM-Storwize rumors, but he did have this piece advice for Storwize:  "Hold on tight and try to enjoy the ride although sometimes the wave will carry you." Merging a small startup into IBM has two major challenges. One is being be able to scale operations quickly. "Once you take a tiny company and put them into the sales engine of IBM you automatically generate a huge multiplier of sales very fast while there are still very few people who know how the product works and can support it," says Zohar.

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