It was a treat for natives of the Boston area to go to the Museum of Science–most of us who hail from Massachusetts agreed the place is a staple of our childhoods. I haven’t been there in about 15 years, but was both surprised and delighted to find that most of the main exhibit areas I saw haven’t changed at all (leading one analyst to crack wise about EMC’s selection of venue for an “Innovation” day).
Here’s a photo of some of the usual suspects attentively listening to Joe Tucci give his entire PR staff heart attacks by revealing the code names of four new products set to be announced next year. (Said Tucci of the meeting during which objections to the pre-announcement were registered: “I asked, who do I see about getting that policy changed? And the arguments ceased.”)
Last but not least, here’s the newly appointed president of the compliance and archiving division at EMC (formerly chief development officer) Mark Lewis demonstrating a new Documentum interface called Media Space.
It’s showing an computer-generated sketch of a hypothetical video game console to show how the program can be used to collaborate on images.
Storage vendors look forward to the fourth quarter of every year because customers need to spend the rest of their annual budget, so they buy a lot of storage products. At this time of year you hear storage CEOs gleefully refer to “budget flush,” and the fourth quarter is almost always their top revenue period.
But this year that flush you hear may be their business going down the toilet. There has been a trend of CEOs from large tech companies warning that large enterprises and particularly financial services firms are spending less, and this could spill over to the rest of the business world.
Cisco, Symantec and IBM expressed those sentiments during their earnings reports over the past month or so. But while those companies sell storage, it’s not their main business. Storage is Network Appliance’s sole business, however, and CEO Dan Warmenhoven was no more optimistic during NetApp’s conference call Wednesday night.
Although NetApp had good results last quarter and gave a sunny forecast for this quarter, Warmenhoven pointed to a few ominous signs: business in North America was slow, outside of federal government. Revenues from NetApp’s 22 largest customers fell 4% over the last year. And he is worried that the problems with U.S. financial services firms could spread to the U.K., and other U.S. industries.
“I don’t see any pattern other than the financial services meltdown, and I would encourage all of you who are part of the financial services – especially broker-dealer organizations-to please keep that among yourself,” he told financial analysts on the call. “Once you start exporting that set of problems to the rest of the economy, everybody is going to go in the tank.”
Warmenhoven’s take on the economy was gloomier than EMC’s Joe Tucci’s comments last month when he said sales to financial services were “all right” but “nothing to write home about.”
But storage vendors’ gloom can be good news for customers looking to buy. NetApp execs spoke of “selective pricing” and pricing bundles on their conference call. They refused to get specific when analysts tried to pin them down, but it sounds like this could be a good time for a discount.
Riverbed is going on the offensive in its patent lawsuit infringement battle against Quantum by filing its own claim against the backup vendor.
In response to Quantum’s patent infringement suit filed five weeks ago, Riverbed this week filed a counter-claim in Federal District Court in San Francisco charging that Quantum’s data deduplication products infringe a Riverbed patent. Quantum’s original lawsuit accused Riverbed of infringing a Quantum patent in its wide area file services devices.
A Riverbed press release quotes general counsel Brett Nissenberg saying Riverbed carefully evaluated Quantum’s DXi series of deduplication products after the original lawsuit, and found that Quantum infringed on Riverbed’s patents.
Basically, Riverbed is saying “Not only didn’t we infringe on your patent, but you infringed on ours.” Now Riverbed is seeking what Nissenberg calls “substantial compensation” from Quantum, along with an injunction preventing it from using the technology.
If this all sounds familiar, it is. Substitute Quantum for Network Appliance, Riverbed for Sun and deduplication for ZFS and you have a similar situation going on with the storage system vendors. The difference here is, Riverbed and Quantum aren’t exchanging verbal smacks via executive blogs.
Riverbed CEO Jerry Kennelly did address the issue during the company’s earnings call last month, calling the lawsuit “meritless.”
“We know our products,” Kennelly said. “We have read their patents and we do not infringe their patents and we tried to tell them that for eight months.”
Quantum had a similar response to Riverbed’s legal action. “We believe that Riverbed’s counter-claim is entirely without merit and will obviously defend ourselves vigorously,” a Quantum spokesman said in an e-mail to SearchStorage.
Disclaimer: I do not claim to be an expert in international politics.
That said, let me dive right in to that subject.
We know this much is true: China is a force in the world to be reckoned with, and that only becomes a trickier proposition with every passing day. Because while we enjoy their cheap labor and cost-effective manufacturing processes in this country, the behavior of the Communist regime in China is often, er, problematic for citizens of Western democracies.
We also know this much is true: inexorably, inevitably, tech companies are following the money straight to Beijing. Cisco announced it plans to invest $16 billion in China; EMC recently committed $1 billion through 2012. U.S. networking player 3Com was bought out in part by its Chinese partner, Huawei. And while there are clearly strategic reasons for these investments, companies doing business in China are also running up against the ethical conflicts mentioned above.
Perhaps “running up against” isn’t the correct term. Perhaps “crashing up against” or “clashing with” would be more appropriate. It’s a rare and fascinating thing to watch the worlds of morality and business intersect in this way.
Cisco is the prime example. Shareholders at its Nov. 15 meeting are expected to bring the China issue to the forefront of debate.
One proposal, from Boston Common Asset Management LLC , has been on Cisco’s ballot before and attracted significant support at last year’s meeting.
Boston Common is asking Cisco for a report on how it could reduce the chances of its equipment being used to repress privacy or freedom of expression. “What kinds of questions are they asking when they go into these markets? Are they even asking these questions?” says Dawn Wolfe, a Boston Common social research analyst.
Boston Common’s proposals attracted support from 19 percent of voters at last year’s meeting. “That’s a tremendous amount for a human rights proposal,” Wolfe says.
If it’s not careful, Cisco might repeat the mistake of Yahoo, which has been taking no shortage of heat for its role in assisting the Chinese government in imprisoning two political “dissidents” 10 years each for running news stories without permission.
In fact, even if it is careful, Cisco’s equipment could still be at the center of practices considered nefarious in the U.S. (and, well, in most places). Seagate’s subsidiary Maxtor found this out the hard way recently when Chinese subcontractors inserted malware into Maxtor external hard drives bound for Taiwan, containing trojan horses which automatically upload saved information to Web sites in Beijing.
On top of the ethical issues there is also the matter of international espionage. It sounds like something out of a hyperdramatic James Bond scene, but North American technical trade secrets falling into Chinese hands has also been a very real fear expressed by some in the tech market after rumors surfaced earlier this year that Seagate was about to be acquired by a Chinese company.
And yet here we are between the proverbial rock and hard place. China’s not going away. The Chinese economy isn’t going away. But unfortunately neither are the political brambles snagging U.S. companies chasing Beijing’s business. Some people argue that the advancements afforded by economic prosperity could bring China closer to something resembling acceptable human rights in Western eyes. Others point out that’s exactly the argument made by companies who continued to invest in apartheid South Africa.
I’m wondering why Cisco, EMC et al, can’t invest just as heavily in some kind of social activist group, Human Rights Watch, maybe, or Amnesty International, to try to counterbalance the investments that might encourage China’s human rights abuses. I guess they’d argue that’s not their responsibility.
But it might be the right thing to do anyway.
Imagine you’re a down-on-her-luck new divorcee looking to get back on her feet. The year is 1999. You manage to find a job as an in-house masseusse at a little Silicon-Valley dotcom startup for $450 a week and stock options for a company nobody’s really heard much about yet.
Eight years later, you retire a millionaire.
Sound far-fetched? It is, but it’s exactly what’s happened as a result of Google’s rise to Internet dominance and accompanying $700+ share price over the last few weeks, according to a New York Times report.
Even more interesting–according to the Times:
Although no one keeps an official count of Google millionaires, it is estimated that 1,000 people each have more than $5 million worth of Google shares from stock grants and stock options.
I wonder if there are any Google millionaires reading this right now. If so, you’re buying lunch.
Some people will do anything to avoid data migration.
You can’t inhabit the storage industry for longer than a week without becoming intimately acquainted with how painful data migration is. Whole product categories have sprung from this pain.
But…still…as an application and internet service provider, you might have hoped Massachusetts-based NaviSite would have had a more foresight than to consolidate data centers by packing servers onto trucks owned by a recently acquired company and shipping them up to Boston by truck. In the process, according to a Boston.com account of the chaos that ensued, the company “cut off Internet service to thousands of individuals and small businesses across the country for nearly a week.”
One Boston blog made a frank assessment of the situation:
…instead of doing it the right way (buying new servers, getting them running in Andover, then using that wacky thing called the Internet to move all the data from Baltimore to Andover), they did it the majorly wrong way.
For most of our audience, there’s at least one comforting lesson to be taken from this story: you could be having a pretty bad day, but at least you’re not the guy who made that decision.
ETA: Speaking of roads and data. We have to take our storage humor where we can get it, so I also feel the need to share with you the line from an acquaintance of mine when he heard about Fujifilm’s new GPS tape tracking unit: “I wonder what a tape falling off the back of a truck and bouncing down the road looks like on a GPS system.”
“Boss”. Photo courtesy of TartanRacing.org.
Nope, nobody slipped anything into my morning coffee–this did actually happen. NetApp was a member of the Tartan Racing Team, a group comprised of engineers from Carnegie-Mellon university and corporate sponsors / partners, including GM, Caterpillar and Continental. Tartan was facing off against other teams, each spearheaded by a university robotics group such as MIT or Cornell and joined by technology and automotive vendors, in a contest to create vehicles that give new meaning to the word “automatic.”
The contest is run by the Defense Advanced Research Project Agency (DARPA), the same government entity (along with Al Gore) credited with creating the Internet. DARPA set up a twofold challenge for each research team in a robotics competition to create a vehicle that could drive itself, unmanned, through any terrain, and created a twofold contest–one race in the desert and one in an urban environment–to test the entries.
NetApp has sold some of its small filers into military accounts for use on transport vehicles in combat zones, but this time didn’t contribute technology to the car itself–more like the car workshop, where NetApp storage was used to log and analyze data as the vehicle was developed.
Tartan and its creation, a Chevy Tahoe dubbed “Boss,” were the winners in the desert portion of the race, 170 miles which only three of 11 teams finished. Tartan also won the 60-mile urban course, in which 6 teams finished. The Discovery Channel will be covering the DARPA contest and all its entrants in a multi-part miniseries set to air in the spring, NetApp officials said; the network even brought in the stars of Mythbusters to act as TV analysts for the event.
The whole event was put on in fun, of course, but imagine the creepy possibilities of this technology: unstoppable, unmanned tanks storming cities; unmanned SUVs hunting in streets for the enemy. How would you even defend against something like that? It boggles the mind.
“Well,” pointed out Chris Urmson, director of technology for the Urban Challenge at the Robotics Institute at Carnegie Mellon, somewhat uncomfortably cutting off my Calvin-like woolgathering. “It’s not just a weapon.” Urmson pointed out that one of the primary use cases envisioned by the military for unmanned vehicles is the creation of a kind of trackless train comprised of driverless SUVs following one manned vehicle in the front, cutting down on the casualties associated with supply convoys in combat zones. The driverless cars also have possible commercial applications (Minority Report, anyone?) as well as a possible place in agriculture.
I just sometimes have a little too vivid an imagination.
Executive holdovers from Veritas are growing fewer and farther between at Symantec, following the disclosure by Symantec in an SEC filing this week that Kris Hagerman, president of the Data Center Management group, has left the company. According to a Reuters story on the departure, Symantec has also confirmed that senior vice president James Socas has also left. Socas was senior vice president of Corporate Development, leading the mergers & acquisition practice.
These departures are the latest in a general exodus of former Veritas officials from Symantec since the companies merged in December 2005. Veritas CEO Gary Bloom and head of the data management group Jeremy Burton also left Symantec before Hagerman. Beyond saying “a number of factors contributed” to the departure of Hagerman, Symantec declined to specify a reason Hagerman walked away.
Symantec has been keeping up with frequent updates to its Veritas products, especially the “meat and potatoes” backup software products, Backup Exec and NetBackup. But its sales numbers and ranking in the market have continued to decline. On its most recent earnings call Symantec CEO John Thompson said the company would begin pruning back its Data Center products, but did not give specifics as to which products would get the axe:
Earlier this year, we started an active review of our product portfolio to ensure many of the investments made over the years are meeting our return expectations. During the September quarter we identified some non-strategic assets in the Data Center Management Group that have not met those expectations. As a result, we are taking an $87 million writedown of some assets in the data center management group acquired by Veritas during the 2003/2004 timeframe. Going forward, we will continue to evaluate our portfolio to ensure that we focus our investment efforts on a few key strategic areas that drive long-term revenue growth.
Meanwhile, what had been a vibrant brand in Veritas has started to fade from the market, according to analysts. “Since the acquisition, Veritas has not been as visible in the industry as it was–they used to be a very engaged company and took a leadership position with technology,” according to Taneja Group founder Arun Taneja. “After a year of hiatus following the acquisition, Symantec is keeping up with products, but they’re not providing leadership like Veritas used to.”
For years, Dell has made noise about pushing deeper into storage outside of its partnership with EMC – all the while maintaining that partnership.
The deal tells us Dell is clearly interested in becoming a bona fide storage vendor, and it took the best route possible to making that happen. It also tells us it is a matter of time until its partnership with EMC falls apart, despite an agreement that runs through 2011.
Nobody from Dell or EMC will say that. Their party line is the EqualLogic products fall into Dell’s SMB PowerVault platform, and Dell and EMC will continue to co-market mid-range Clariion systems.
That argument doesn’t hold up for several reasons. First, EqualLogic’s higher end systems are not SMB plays. The PS3000 it launched a year ago has a starting list price of $65,000 – more than twice that of most PowerVault products. EqualLogic has always considered midrange storage titans EMC, Hewlett-Packard and Network Appliance its main competition. And EMC people privately consider EqualLogic a genuine midrange competitor. EqualLogic can help Dell sell to SMBs, but it has also been adding features such as thin provisioning and virtualization capabilities to make its SANs more enterprise friendly. Is Dell going to scrap those technologies? That’s unlikely.
Then there is the iSCSI factor. By buying EqualLogic, Dell is betting most of its storage chips on Ethernet-based iSCSI. That’s no surprise. Dell’s business is built on Ethernet. But EMC’s is built on Fibre Channel. While Fibre Channel vendors have come to sell iSCSI and accept that it has benefits, they’re not betting their business on it. The major Fibre Channel vendors have even created a new protocol – Fibre Channel over Ethernet (FCoE) — aimed at stunting iSCSI’s adoption. Down the road, the paths of Dell and EMC will diverge over iSCSI and Fibre Channel.
Finally, there is the personal relationship factor. The EMC-Dell partnership benefitted from a close relationship between their respective CEOs, Joe Tucci and Kevin Rollins. Tucci even showed up unannounced at a Dell Technology Day last year to show support when angry investors were calling for Rollins’ head. Now Rollins is gone, and founder Michael Dell is back at the helm. Nobody’s saying Tucci and Dell don’t get along, but it’s not the same as Tucci and Rollins. And there’s no guarantee that EMC fits in Dell’s plans to turn around his company.
The EMC-Dell marriage made great sense when it began in 2001. Both companies were staunch competitors with Hewlett-Packard and IBM, who sold servers and storage. So instead of EMC making its own servers and Dell manufacturing storage, they partnered. And the relationship worked out until now — Dell is responsible for about 16 percent of EMC’s storage systems revenue and around one-third of its Clariion sales. But the landscape has changed, accelerated by Dell’s purchase of EqualLogic. The main question is: how long it will take for divorce papers to be filed.
I know, I know … whenever I see “killer app” I roll my eyes too, but I’ve been shown the light, or indoctrinated, whichever way you want to look at it. So here is my take: I’ve found storage’s killer app, and it’s hiding in plain sight.
There … I said it … EMAIL.
At work we’ve been deeply involved in identifying the platform for our next generation SAN. We’ve been busy identifying performance metrics (the benchmarks I’ve taken off some of these machines are incredible–I’ll blog about it soon!!) and precisely what we use our storage for. I’m a big VMware fan and throughout this discovery process I’ve had in the back of my head that VMware is the biggest thing we need to plan for. I was looking at VMware/host virtualization as the killer app for storage and I was wrong.
While we don’t and wouldn’t actually look at what is in end users’ mailbox, we do see the size of the mailboxes. We have quotas for most but some folks warrant an exception. It dawned on me during this process that we’ve been building out our Vmware infrastructure to mainly provide the filler for messaging and collaboration. I’m a cynic by nature so I decided to take a deeper look into my own email habits to see if this theory held water.
If you ever really wanted to surprise yourself, take a look into the dusty corners of your home machine’s email program.
So my basic conclusion is my dinky laptop hard drive is no place for my archive.pst. I need RAID 10 striped across 14 drives … for just the imbroglio (this was a great SAT word submission!!) I call my inbox. How many attachments I have, how much email I actually get, how much of it I keep, how it gets indexed by my desktop search, and finally how it gets archived all lead to a surprising portion of my work laptop hard drive dedicated to email. I also started looking at where I pull the information from to put in my email and found that almost all the work I produce gets emailed to someone, then they store it or email it to someone else.
At work I have about 800MB of active email data and about 4GB archived for the last 6 months. At home it’s triple that–I actually had to build a virtual machine to handle my third-tier email archives (I like to have my email indexed and available) which leads me to why I believe email is the killer app for storage.
My personal email is always online, indexed and searchable. If I need a piece of information and I can remember one or two unique words I stand a great chance of retrieving it from just about anywhere (I use IMAPS) that I can install Thunderbird or Evolution. It is very convenient and once I figure out how to search from my BlackBerry I won’t ever have to remember anything but keywords.
This convenience of course requires storage, and not only that, but storage that can chew through tons and tons of 2K and 4K files (I use Postfix and Cyrus IMAP on virtual machines at home) to find the bit of information I’m looking for.
Scale me to an enterprise level, think Ultraman. Today there are people in the work force who don’t know what POP is (remember PINE? Ahh the good old days…), have been using their Yahoo.com email account since they could type, and email things to themselves when they want to save it. There is a new generation coming to the workforce after them that EXPECT to be able to have their entire lives searchable and indexed, Google-style.
At work we are moving towards the Sharepoint 2007 /Exchange 2007 /Office 2007 hegemony in the next year or two, and I am concerned that we as an industry don’t really and truly understand what collaboration does to storage requirements.
If I can now collaborate completely on my computer how long will my organization have to keep my Onenote stuff around? Will there be some sort of e-discovery for the group whiteboard? Where will we store all this stuff?