An Acquisition Strategy?
by Claus Mikkelsen on Aug 7, 2006
I suppose we all do it. You know, always analyzing the competition and trying to figure out their strategy, direction, strengths and weaknesses. It’s healthy to keep this focus. Recently, there has been a lot of discussion surrounding EMC and their strategy (well, there’s always discussion about the EMC strategy, not just recently).
A lot of this discussion has been about their acquisition strategy, which has been quite active in the past few years and a recent article by Jo Maitland, a veteran storage journalist, caught my eye. Aside from the hilarious reference to a Mr. Creosote sketch on Monty Python years ago, it summarized well what I’ve been thinking. It also contains a complete list of what companies have been acquired in the last 6 years.
But let’s be serious for a moment. What is their acquisition strategy? Is it to build on their core storage business? Is it to diversify their portfolio? Or is it to just generate revenue? I would certainly say it is NOT to build on their core storage business since their track record for integrating their acquisitions is quite poor, which for their customers, exacerbates the problem the rest of us are trying to solve, which is simplifying their storage infrastructure.
Perhaps it’s just a philosophical difference between our companies, but I’d rather bring integrated solutions to market – be it high end, mid-range, SAN/NAS/iSCSI, or archival solutions – than create more buckets of disparate storage sitting on the datacenter floor with different management controls and tools. Acquisitions on the surface are not bad and can complement a portfolio (and I’ll be the first to admit that some of EMC’s acquisitions have been positive for them), but it takes time to digest (the Mr. Creosote reference) and integrate. Without that process, the only one helped is the vendor, certainly not the customer.
But let EMC continue with the strategy, but let’s all watch what does or does not get integrated.
Claus, I am glad that you are willing to wait and see what EMC does. That surely is a sign that HDS may be maturing in their blogging strategy.
As for the acquisitions, well it is a strategy that a lot of analysts are comparing to other folks like Symantec. It could be one where semi-related technologies can cross-pollinate and benefit from and each other. That is certainly the hope that many of the EMC employees have as well.
Of course you are right, the message to the customer base has not been clear and the integration has not happened as smoothly as it could have been. But being number one takes a lot of work (sorry had to throw in the dig). I too am excited to see what EMC comes up with after their rash of acquisitions, like HDS, EMC has a lot of smart people to leverage these technologies…. What could you do with your storage if you just purchased the most used security algorithms in the industry? It will take time, thankfully the integration of legato and some of the earlier acquisitions is finally happening and I’m sure all storage customers (including HDS’s) will eventually benefit from the advancements made.