EMC, Dell Sign Multi-Billion Dollar Pact

Data storage giant EMC and computer maker Dell have signed a five-year, multi-billion dollar partnership.

Under terms of the deal, Dell becomes the leading reseller of EMC’s CLARiiON product line. CLARiiON will in turn become Dell’s standard offering for storage
area networks (SAN) and high-end network-attached storage (NAS) installations.

Dell, based in Austin, Texas, can now offer a broader range of storage products as well as improve its overall offerings to large companies. While a significant, it still
trails Compaq in the storage sector.

The deal could be more important for EMC, which has struggled mightily in recent months, as evidenced by layoffs and lurking competitors such as IBM and Hitachi .

But some firms, such as Goldman Sachs’ research arm, remain faithful. After the firm posted a net loss of nearly $1 billion and cut another 1,600 jobs, GS said EMC
could rebound with its midrange server offerings.

EMC said Monday’s agreement builds on its strategy to work with partners to bolster its presence in the Windows NT and Windows 2000 storage markets.

“Dell and EMC are both sharply focused companies in the world of information technology,” said Sean Derrington, senior program director at META
Group. “This is a highly complementary relationship that will greatly benefit both firms and their customers.”

“We expect Dell’s direct sales model will increase EMC’s reach and capability to better service enterprise-class CLARiiON customers, including a much broader set
of small and medium-sized businesses,” said Joseph Tucci, EMC president and CEO. “The midrange information storage market alone last year was about
a $15 billion opportunity, and we were barely scratching the surface with an industry-leading product.”

Tucci’s $15 billion opportunity claim is probably not exaggeration. Many current research notes peg various aspects of storage, from software to networking, in the
billion-dollar range. To be sure, IDC research projects worldwide storage software market sales to soar from $5.47 billion in 2000 to $10.7 billion in 2005.

Monday’s deal is by no means exclusive; Dell will continue to offer its PowerVault direct- and network-attached storage systems and EMC will continue to offer its
industry-leading Symmetrix and CLARiiON family of enterprise storage systems and software, directly and through partners, to customers worldwide.

Dell will begin offering the EMC products, which include the FC4500, FC5300, FC4700 and IP4700, to customers in November.

Editor’s note: Boulton writes for Internet News, an internet.com site.

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