In a dramatic move this morning, Dell announced the intention to purchase the innovative vendor of enterprise storage 3PAR for $1.15 billion in cash. If there were any doubts remaining about Dell’s commitment to be a force in the storage market alongside of EMC, IBM, HDS et al., this deal should put them to rest. Dell acquired the iSCSI storage array vendor EqualLogic in November of 2007, clustered NAS vendor Exanet in February of this year, and most recently they bought data deduplication vendor Ocarina this past July, as well as putting together a partnership with object storage vendor Caringo. Clearly these are a significant list of deals, but the strategy was incomplete without an enterprise class primary storage system of their own. 3PAR, whose products generally compete with high-end systems in terms of performance and availability, will give Dell the ammunition they need to go head-to-head with the big guys.

Dell has cultivated a relatively successful partnership with EMC for mid-range and enterprise storage for some years, but in spite of Dell’s claim to be invested in that relationship going forward, this deal clearly puts pressure on it. Initially, there is a gap between the SMB focused EqualLogic products and the high-end offerings from 3PAR, which will be filled by the Clariion products from EMC, but in the long run, Dell is likely to be motivated to move out of EMC’s shadow and build its storage brand on proprietary products based on these acquisitions.

This deal ends a good deal of speculation about who might buy 3PAR, with HP the main alternative suitor. HP now faces a build or buy decision as it continues to try to redefine itself in storage amidst a patchwork of the aging EVA platform, partner technology from Hitachi on the high-end, and acquisitions in iSCSI and clustered file storage, but no clearly defined long term vision or anchor technology.

In terms of the broader storage landscape, 3PAR represents one of the last remaining independent storage vendors. With the acquisitions of the last several years, the ranks are thin, with Compellent, Xiotech, and Pillar (although it is hard to call them truly independent with Larry Ellison of Oracle as the main investor) on the smaller front, and EMC and NetApp representing the giants of the storage focused arena.

Can Dell make a go of their big storage vendor ambitions? The EqualLogic acquisition, also north of a billion dollars, is a big success from a revenue perspective, but does little to move Dell into the conversation in the enterprise segment of the market. Convincing buyers that the Texas vendor with a reputation for laptops and online purchasing can swim with the big fish will be a taller order than selling iSCSI to SMBs. Storage is a tricky business built on reputation and buyer conservatism, but the presence of enterprise services from the acquisition of Perot Systems and the big outlays for key storage technologies will take them a long way down the path if they can bring it all together and demonstrate that they can solve big, hairy data challenges. Clearly storage is hot right now, and Dell is putting their money where their mouth is to be a part of the big dance.