IBM Attacks EMC Customer Base

IBM Corp. (NYSE: IBM) fired a blast at SAN storage rival EMC Corp. (NYSE: EMC) today when it announced a storage migration program designed to take high-end business from the market leader.

IBM's Piper Service consists of a black box, cost-analysis tools, and consulting help -- all meant to help customers migrate from EMC to IBM storage servers. IBM says the box, based on an eight-engine processor called the Data Migration Engine, is primarily aimed at moving data from EMC's Symmetrix storage array to IBM's Shark array, but IBM claims it works with any competitor's device and any IBM platform.

IBM is also making the migration solution available to its business partners.

While IBM and EMC wage daily skirmishes for customers, this represents a major coordinated strike by IBM, which claims in materials accompanying its published press release that EMC "is confusing customers with multiple acquisitions and multiple changes."

"This is much more aggressive than we've ever been," says Lou Sciacchetano, IBM's worldwide VP of competitive sales. "We're specifically triggering the large legacy installed base of EMC. I'm confident it will be a game-changer for us."From EMC's viewpoint, IBM's strategy is a reaction to EMC's strong surge this year, which comes after two years of losing market share to IBM and Hitachi Ltd. (NYSE: HIT; Paris: PHA) on the high end. "We're flattered," says EMC platforms marketing VP Chuck Hollis. "The heat is on [IBM]. All indications are we're gaining sizeable market share."

Analysts give IBM credit for making a move. "IBM keeps surprising me," says Arun Taneja of The Taneja Group. "It is so unlike the IBM we all used to know and hate. It's a different IBM. They've converted a tool into a product."

That tool, the little black box described above, makes this different from the usual battle for customers, says The Clipper Group Inc. director of enterprise architecture Anne MacFarland.

"There are always takeaway wars; that's nothing new," MacFarland says. "What's new is the piece of artillery they're using."

But even though IBM is making migrating data a less tedious process, some question whether that's enough to bring in a sizeable flow of new business. "The tool makes it easier to migrate, yes," says Taneja. "But you have to give the customer incentive to do it."IBM has its work cut out for it. In Heavy Reading's Fall 2003 Storage Networking Market Perception Study, EMC scored higher than IBM in every category among Fibre Channel SANs vendors. EMC held wide advantages in product performance, product quality and reliability, and a small edge in name recognition, price, and service and support.

Hollis of EMC says speeding up the migration process is less important than influencing the decision process for customers. "Why are you going from here to there? Is it better, faster, cheaper? No. So what's the value to the customer?" he asks. "The success of this will be evidenced by how many they sell." EMC's estimates show it has more than 50 percent of the high-end SAN market, Hollis maintains.

IBM says its Piper test program has already prompted an unspecified number of customers to migrate from Symmetrix to Shark. EMC counters that 300 IBM customers moved more than 1,000 terabytes of data to EMC systems over the last two years.

EMC points out that its storage business grew 21 percent year-over-year, while IBM's grew only 6 percent in the last quarter. IBM's response?

"That's because EMC was in the tank in 2002," Sciacchetano says. "We outgrew them every quarter for the previous eight quarters."Dave Raffo, Senior Editor, Byte and Switch

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