History 2000: IBM OEMs Compaq and Vice Versa

It’s a sizeable deal for ≠2, IBM (ibm.com), and ≠3, Compaq, in storage subsystems and services for large enterprises.

In order to fend off ≠1, EMC, of course.

IBM will OEM Compaq’s StorageWorks and will support its new storage virtualization technology VersaStor.

Conversely, rival Compaq becomes Big Blue’s brother and will OEM IBM’s Enterprise Storage Server or Shark, and will resell systems management software from Tivoli, the IBM subsidiary (until now, Compaq qualified, but did not sell software from Veritas, Legato or Computer Associates).

Both companies have also decided to make their respective product and software lines interoperable, an enormous task ahead of them. The 2 partners have thus planned to invest $1 billion over 3 years to make their systems compatible, and to push for SAN standardization.

Meanwhile, Compaq, which looked to IBM, Quantum and Seagate for the 10,000rpm HDDs integrated in its RAIDs, will include only Big Blue’s devices (on all its StorageWorks systems, or only those shipping to IBM? We can’t tell yet).

It would be highly surprising to see Compaq risk banking on only one drive supplier in such a fluctuating market. (EMC recently criticized IBM for not delivering its 10,000rpm drives)

Users benefit the full content of the agreement is not available yet, particularly the financial details, but the transaction seems to benefit users and Compaq more than IBM.

StorageWorks, which will be taken even more seriously now, will find new customers, notably among IBM’s major OS/390 and OS/400 accounts, and more specifically, those that wish to migrate or entirely switch over to open systems.

It’s far less likely that Compaq will proceed blindly into sales of Shark for mainframes only, or even for OS/390 users with investments in Unix or Windows, given its current clientele.

Jean-Luc Pugnet, storage division director, IBM France, observed: “We have sold Shark for open systems only. And ESS is a good product for big Compaq customers who have one hundred servers. We had a similar agreement with Bull for our RS/6000s. The competition was not between us, much more with Sun. We also hope to develop our tape activity with Compaq.”

Users, however, can only win from seeing the product lines of both firms move gradually towards compatibility. Above all, they will be able to play both suppliers off each other, since they will be competing with exactly the same products under different brand names. It’s the same for some integrators or distributors who currently support products from both companies. More influence for SAN standardization But the agreement, by virtue of the size of its participants, will also allow the duo to have more influence in.

Announced in June, VersaStor provides virtualization for Compaq’s Enterprise Storage Networks. The physical storage is managed as a virtual pool of logical devices where data move automatically on one device or the other according to definition of the storage administrator. Discussions currently underway for SAN standardization, particularly with SNIA, which will be less influenced by the FibreAlliance, the group founded by EMC, to which the other 2 do not belong.

The main WW SAN powers are quietly moving into place: 1) EMC and its allies, including Comparex and Bull, 2) Compaq and IBM, 3) Hitachi Data Systems with HP and SGI, 4) Sun with StorageTek.

None of this will prevent future alignments across camps. It is thus likely that we’ll soon see Compaq supporting StorageTek libraries on its StorageWorks.

One last point not necessarily in IBM’s favor: last year, the company acquired Mylex for no less than $240 million, to get hold of one of the world leaders in RAID controllers for open systems. What, then, will become of Mylex when IBM begins reselling StorageWorks with its Compaq-supplied controllers?

This article is an abstract of news published on issue 150 on July 2000 from the former paper version of Computer Data Storage Newsletter.