Storage vendors were cautiously optimistic over signs of a spending uptick in late 2009, but at least one has stumbled out of the gate in 2010.
Compellent Wednesday evening said it missed its sales projection last quarter, and expects to report revenue of around $31.5 million to $32 million instead of its previous guidance of $35 million to $37 million. The new projection puts Compellent revenue down 12 percent to 13 percent over the fourth quarter of 2009, and up about 12 percent to 14 percent from the first quarter of 2009.
Compellent CEO Phil Soran blamed the shortfall on delays in some large orders and changes in the sales force, and said “We remain positive about the outlook for continued growth.”
But analysts and investors weren’t so forgiving. After several Wall Street firms downgraded its stock price, Compellent shares opened today at $13.75 – down from Wednesday’s closing price of $17.56 – and continued to fall this morning.
Analysts also believe Compellent’s problems were not typical of storage vendors last quarter. Wedbush Securities analyst Kaushik Roy did not downgrade Compellent, but pointed out Xyratex reported better results than expected, LSI raised its guidance for the month and EMC is expected to beat its previous forecast for last quarter. Roy wrote in a note to clients today that part of Compellent’s problems are caused by growing pains as it finds itself with greater challenges than when it went public in 2008.
“As the company grows, competitors such as EMC, NetApp and Dell are now increasingly taking notice of Compellent,” Roy wrote. “We believe that competitive pressures from these companies have increased as a result leading to some of the revenue shortfall.”
Roy added that EMC’s announcement of its FAST automated tiering software roadmap may be offsetting Compellent’s first-to-market advantage with its Data Progression tiering software. He also wrote that Compellent’s 100 percent reliance on the channel could also hurt it because channel partners are less motivated than direct sales people to close deals in time to meet sales targets.
Two weeks after Dell revealed plans to develop an object storage system, NetApp today disclosed its object storage strategy by acquiring privately held Canadian vendor Bycast.
Bycast’s StorageGrid software is used mostly in medical archiving products through OEM deals with Hewlett-Packard and IBM. Bycast added support for clustered NAS, security partitions, chargeback and virtual servers to its basic archiving features, and began marking StorageGRID as a building block for private and public clouds. It lets NetApp compete with EMC’s Atmos object storage system designed for internal clouds, as well as provide storage for the growing medical archiving market.
NetApp’s press release today cited Bycast’s value for collaborative projects, specifically in vertical markets such as healthcare, cloud service providers, digital media, and Web 2.0 companies.
“Bycast extends our unified storage strategy and enhances our solution for shared storage infrastructure by adding new capabilities for global data access and mobility,” Manish Goel, NetApp executive vice president of product operations, said in the release. “The addition of Bycast’s products enables NetApp to offer our enterprise customers and service provider partners a complementary solution that enables them to efficiently build and manage a very large-scale global repository of data central to many IT-as-a-service offerings.”
It’s unclear if StorageGrid capabilities will be built into NetApp’s core storage systems or will be sold as a separate product, but the reference to extending the vendor’s unified strategy seems to indicate some integration. It also remains to be seen if NetApp will continue Bycast’s OEM deals. IBM is a close NetApp OEM partner, but HP is one of NetApp’s biggest competitors.
NetApp isn’t saying how much it paid for Bycast, but says it was a cash transaction.
Check out our SearchStorage story for me on this acquisition.
NEC Corp. of America said today that its HydraStor grid backup and archive storage system has been integrated with Symantec’s OpenStorage API (OST) to give Symantec NetBackup users direct control over HydraStor for data deduplication and replication.
OpenStorage, first launched in late 2006, allows NetBackup users to control when backup images are created, duplicated and deleted using disk backup targets. The storage device controls the “how” through processes like deduplication, single instancing, compression and performing replication. NEC supports the base plugin, which authenticates HydraStor devices automatically with the NetBackup media server and records events kicked off by NetBackup within the HydraStor grid back to the NetBackup catalog.
Other OST partners with their own integration already on the market include EMC/Data Domain, IBM Diligent, FalconStor, NetApp and Sepaton. Some of these partners, such as Data Domain, claim their OST integration boosts the performance of data deduplication appliances through a portion of the API that allows the native I/O stack to the disk backup appliance to be replaced with an optimized one.
According to director of product marketing Gideon Senderov, NEC is taking a differnt approach with a feature it calls OpenStorage Dynamic I/O,. This feature will allow NetBackup to control and optimize I/O load-balancing across the HydraStor grid. This customized integration between the two products included walking a fine line between potentially losing efficiency by dynamically distributing jobs across too many controllers and potentially losing load-balancing flexibility if I/O patterns are too static, Senderov said.
The NEC integration will also offer one other value-add feature, which NEC calls OpenStorage Optimized Copy. This allows for NetBackup to control the creation of backup copies in the HydraStor system, including off-site copies.
Senderov said the base plugin and Dynamic I/O will be available at no additional charge for HydraStor customers. But OpenStorage Optimized Copy will come at a price of $7000 per HydraStore accelerator node.
My SearchITChannel colleague Barb Darrow blogged this morning that her sources are saying Symantec is preparing to lay off a significant chunk of its sales force.
In the meantime, sources in the enterprise storage industry also say Symantec is laying off more engineers that have been working on its storage software products, on the heels of a reported layoff of Veritas file system engineers that surfaced about two weeks ago.
Sources close to Symantec say the company is laying off employees from an office in Lindon, Utah, affecting developers reportedly working on Backup Exec System Recovery (BESR) and Enterprise Vault.
As with the Veritas file system division, sources indicate much of the work is to be outsourced to India, although one source indicated some of the BESR engineers will be transferred to the Heathrow, Florida office where developers of the core Backup Exec backup software product work.
Update: After this post was originally published, a Symantec spokesperson contacted Storage Soup, confirming there has been downsizing at the Utah facility, but correcting earlier reports that the Lindon office is to be shut down completely. “We are definitely NOT closing down the Lindon facility,” the spokesperson wrote in an email. “We are minimizing our footprint but will continue to maintain our presence in Lindon. That process includes elements such as moving functions to other facilities and also giving employees in the Lindon area the flexibility to work from home. There will also be some downsizing, but we are not disclosing any specific numbers. ”
Symantec has discussed consolidation of Backup Exec and Backup Exec System Recovery, which share some feature overlap as well as a brand name. While Backup Exec does not perform bare-metal restore of operating system and application objects and settings for physical servers, it can offer similar capabilities for virtual machines as of version 12.5. Meanwhile, as of version 8.5, BESR offered agents that could be used for a Granular Restore Option to restore individual files from Exchange or SharePoint server images, which mirrors what Symantec calls Granular Recovery Technology (GRT) in Backup Exec and NetBackup.
BESR 2010, released in November, added support for Linux and deeper integration with Symantec’s Management Platform, based on its acquisition of Altiris. At the time of that announcement, execs said integration between BESR and the core Backup Exec product remains on the roadmap for the two products, but declined to give a time frame. BESR is positioned for the smallest of SMBs, while Backup Exec is positioned for SMB Windows shops.
Symantec reported Jan. 27 that it saw an 8% decline in storage sales for its fiscal third quarter (December 2009) as compared with the same quarter a year earlier, although the $594 million in revenue generated by the Storage and Server Management group represented an increase of 6% sequentially.
The last time Symantec disclosed significant layoffs was in 2007, the result of streamlining the company after integrating Veritas. At the time, then-CEO John Thompson addressed rumors that Symantec was preparing to spin off the Veritas storage business on an earnings conference call.
Similar speculation is floating again with these latest reports of layoffs at the company, but our source doesn’t see things playing out that way. “I don’t think [Symantec is] moving away from storage,” the source said. “Just lots of continued [cost] trimming around the edges and more aggressive off-shoring.”
Symantec declined to comment on “industry rumors and speculation” when the reports about Veritas file system engineers surfaced two weeks ago. So far, the company’s reps have yet to return my requests for comment today.
Update: Shortly after this post went live, a Symantec spokesperson directed me to a statement issued on the Symantec website emphasizing the company’s committment to the storage space (but not refuting reports of layoffs) —
The purpose of this communication is to address erroneous speculation that Symantec is leaving the storage space or somehow de-emphasizing the importance of our Storage and Availability Management (SAMG) portfolio for our valued customers. The bottom line is — Symantec is not exiting this space, and we remain committed to helping our customers who face significant challenges in managing storage growth and ensuring the availability of their critical information.
Symantec is 100 percent committed to our SAMG product portfolio. None of the SAMG products that we offer today are being discontinued. We are continuing to invest significant engineering resources in our core Storage Foundation and High Availability (SFHA) and Storage Management solutions. Some of the core areas where we are increasing investment are around Cluster File System, Dynamic Multi-Pathing, and value-added integration with VMware environments.
Across the SAMG product portfolio, we are making significant progress in improving quality and customer experience. In addition, we are continuing to innovate with new products and technology capabilities. One example is the recent announcement of our FileStore solution, which is built on our proven SFHA technology and incorporates technologies from our security and data protection portfolio. Another example is our recently announced Data Insight technology, which will be released shortly within our Data Loss Prevention solution.
Meanwhile, I also came across a local news story about Symantec buildings in Lindon, Utah being evacuated today “after employees reported finding a threatening note.” That news story makes no connection to any layoffs, however, and says the motives for the threat remain unknown.
It’s pretty much an open secret by now that EMC is getting ready to refresh its Clariion midrange disk arrays this month. Among the details leaked so far about what the new product will contain is the suggestion it will support NFS and CIFS, signaling the beginning of a consolidation of Clariion and the Celerra NAS platforms.
But another detail offered by an industry source earlier this week caught my eye and rang a bell when it comes to this announcement —
Deeper integration with VMware — “integration not available elsewhere,” according to one source – is supposedly a big feature of the new Clariion. EMC will apparently play up storage virtualization as well, although it’s unclear yet what new virtualization features will be included.
That’s when I remembered something I came across at EMC World two years ago, in an exhibit on the show floor called the Innovation Showcase. Among the product sneak previews I noted at the time:
Senior consulting software engineer Sorin Faibish was showing off his own diagram of “Application-Aware Intelligent Storage.” This would combine artificial intelligence software capable of being “trained” with hardware-embedded VMware ESX servers to automatically spawn services like data migration, encryption and replication to data as it comes into the cache on a storage array. The embedded ESX host would run EMC’s RecoverPoint CDP inside, logging and catalogging I/O, indexing data for input into a modeling engine, which would then decide on the proper way to store and protect the data before flushing it to disk.
No time frame was given on any of the prototypes.
Just something to ponder while we’re all waiting for a press release.
The new offering is based on the company’s acquisition of data classification company Avalere in 2007, and Iron Mountain first released it to customers at the end of 2009. Iron Mountain plans to integrate Connected Classify & Collect with Iron Mountain’s other cloud data storage services, LiveVault and Virtual File Store (VFS), although the vendor has given no timeframe for that yet.
Data collection on corporate PCs is one of the thorniest areas in e-discovery, according to analysts. Iron Mountain claims pre-classifying data will lead to more comprehensive e-discovery searches. “We’ve come to realize that Connected can be more accurate than file shares or impounding employee laptops,” Iron Mountain Digital director of product management David Asher told SearchDataBackup last year. “By the time laptops are impounded, an employee may have had days to delete data.”
Two storage-focused equipment distributors converged today as Bell Micro agreed to be acquired by Avnet for $594 million, $342 million of which will go to pay off Bell Micro’s debts.
The impact of this announcement is mainly being felt in the IT channel, with speculation in the industry focused on whether this move for Avnet is a means of lessening its dependence on Sun hardware products after Oracle said in January it would take Sun’s largest customers direct.
Enterprise Strategy Group founder and president Steve Duplessie blogged this morning that he doesn’t see the distribution market expanding again any time soon:
[T]here used to be a ton of big distributors, but they don’t seem to be around anymore–besides Avnet. Bell was a $3B giant, but just agreed to get purchased by Avnet for only $250M or so (net of debt). That’s one small multiple, which tells me you probably don’t want to be in the distribution business. Any business that requires outrageous capital, offers huge risk, and only has a shot of giving back fractions of a penny on revenue ain’t a business for me…In many ways, the distribution game has changed such that it seems impossible for anyone to get in at this point. It takes so much money and expertise to build up logistics and inventory management systems–who could possibly enter and make a run at it?
But he isn’t sure whether the deal will have much of an effect on pricing for storage end users, since manufacturers and not distributors tend to have more of an effect on pricing.
According to StorageIO founder and analyst Greg Schulz, “for the storage end user [this merge] should have little impact as [end users] buy from the VARs. The distributors like Bell, Ingram, Techdata, Avnet, Synex, and Arrow are the suppliers to the VARs on behalf of the manufacturers.”
The storage Twitter-sphere was abuzz this morning with reports from bloggers attending HP’s Storage Day, an event for end-user and partner bloggers to hear about HP’s vision for storage.
Among those tweets a familiar name began to pop up: Tom Joyce, whom I first met when he was working in product marketing for EMC Corp. Joyce left EMC and was appointed CEO of Akorri Inc. in 2007; he left Akorri for Stratus in 2009 but has now resurfaced in HP’s StorageWorks division. An HP spokesperson confirmed this morning that Joyce joined the HP StorageWorks group as its vice president of marketing in late February.
Joyce joins HP in the wake of last year’s high-profile defection of former EMC storage division head David Donatelli to HP, where he serves as EVP of servers, storage and networking.
Joyce joins Patrick Eitenbichler in HP’s StorageWorks division. According to Eitenbichler’s LinkedIn profile, he is now director of marketing for HP Software. An HP spokesperson wrote in an email to Storage Soup today that there have been “no other [executive] changes I’m aware of.”
Is EMC merging its Clariion SAN and Celerra NAS platforms or not? EMC president of information infrastructure products Pat Gelsinger discussed that topic with financial analysts today, and refused to tip his hand either way.
Gelsinger spoke about driving synergies between the midrange Clariion and Symmetrix enterprise SAN platforms during a webcast with analysts to discuss EMC technology. When asked why EMC isn’t merging Clariion and Symmetrix and that it’s “well known” that it is merging the Clariion and Celerra, Gelsinger said that was just rumor at this stage. He didn’t deny that convergence was coming either, though.
“I would point out on the Celerra and Clariion lines, there are wide rumors in the industry about our product strategy in those areas, but we haven’t made any public statements,” Gelsinger said. “Our plans are, we’re going to continue to carry forward the Clariion customers, we’re going to continue to carry forward the Celerra customers. There are opportunities for simplification in those product lines and more effective use for those products, but we haven’t laid out specific product strategies or brand strategies in either of those areas.”
For the record, Gelsinger’s answer on why not merge Clariion and Symmetrix was, “I haven’t said we will or we won’t.”
Rumors of convergence between Clariion and Celerra have been spreading for months. They were so strong in February that EMC issued denial. Now the convergence talk has started up again ahead of an expected Clariion upgrade launch. Many will probably take Gelsinger’s statement as more of a confirmation of a merger than a denial, but it appears that EMC is trying to keep the platforms separate for now.
Dell’s decision to begin branding Celerra makes the timing curious for platform convergence. Dell already sells Clariion, so why brand Celerra as a separate system if EMC is merging them soon?