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The past few years have been rough for technology vendors, even ones in hot markets like storage. Many hunkered down, cut staff and costs, and tried to ride out the recession. Not Joe Tucci, president and CEO of storage leader EMC Corp. He decided it was the perfect time to transform EMC from mainly a hardware company to one that increasingly focuses on software and services.
As part of that grand plan, EMC last year bought Documentum and VMware, following up on the purchase the year before of Legato Systems. EMC spent more than $3.5 billion on those three deals. The acquisitions should begin to pay off this year with the introduction of integrated data- and content-management software platforms from EMC, Tucci says. "For the first time, software and services should make up more than half of our total revenue."
A growing economy will help. "All of us are always hoping for a pickup in expenditures, and we saw some growth in the fourth quarter that should continue in a better year ahead," Tucci says. "We expect storage-market growth of 6%, and 3% to 4% growth in the overall IT market."
The key, he says, is to deliver what customers need while developing products they don't yet know they need. "Customers want to buy more technology but only as they need it," Tucci says. "We vendors must keep ahead with the technology, but customers won't want it until they can use it."
One thing customers do want is a greater ability to "virtualize" storage devices and systems: to treat them as a single pool of resources that can be allocated and reallocated as needed. They also want better tools to automate the management of data from creation to deletion or long-term storage--something EMC calls information-life-cycle management. Better tools are on the way, Tucci says.
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