On Monday November 5th, Dell announced plans to buy iSCSI storage system vendor EqualLogic. This is a huge step forward for Dell, who until now has been content to sell relatively undifferentiated proprietary storage solutions based on server hardware and Microsoft operating systems, as well as OEM versions of industry leader EMC’s AX and CX lines. Fitting well with Dell’s theme of IT simplification, EqualLogic is an innovator, with an advanced technology that helps users take better advantage of IP-based storage, which is a lower cost alternative to Fibre Channel. EqualLogic’s design is cutting edge in three ways: 1) modular scalability that allows for easy capacity growth and increased controller power, cache, and I/O whenever capacity is added; 2) multiplexing architecture that allows multiple paths to each controller, effectively tripling the bandwidth of the 1 Gb Ethernet links; and 3) powerful software that automates many storage management functions, allowing companies without significant storage expertise to take advantage of the advanced storage functions included with every EqualLogic array.
This deal is interesting in a number of ways. For one, it is a validation of the iSCSI protocol which competes today for adoption with traditional Fibre Channel, and will compete with Fibre Channel over Ethernet (FCOE) going forward as 10Gb Ethernet becomes more prevalent. Also, this is a change of strategy for EqualLogic who had expressed the intention to go public in recent months. For a smaller emerging vendor to compete head-to-head with the giants of the storage industry in terms of R&D, interoperability and global sales and support is extremely difficult. Storage is an industry with very conservative buyers, high switching costs, and significant consideration of brand equity. Getting the deep pockets, manufacturing prowess, and brand recognition of Dell behind the innovation of EqualLogic is likely to be a powerful combination. There will be concerns around product roadmap continuity and focus, as well questions about placement of EqualLogic products within the current Dell storage lineup, but these are likely to be minimal in comparison to the strong technology benefits and complementary fit between the two companies.
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