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IBM acquired storage resource management (SRM) player Novus Consulting Group Inc. (NovusCG) for an undisclosed price today, bolstering its storage software products and management services amid questions throughout the industry regarding the vendor's strategic direction.
NovusCG has two products, Storage Enterprise Research Planner (SERP) and Enterprise Standardization Program (ESP). SERP creates a business intelligence (BI) layer that pulls data in from existing monitoring tools, including EMC Corp.'s ControlCenter, Hewlett-Packard Co.'s (HP) Storage Essentials, Hitachi Data Systems (HDS) HSSM and HDvM, and Network Appliance Inc.'s (NetApp) Operations Manager. ESP creates standardized workflows and enforces storage best practices in a framework akin to project management software.
The company began as an analyst and consulting firm in 2000. According to NovusCG officials, its software was developed as tools to help consultants help their large clients collect and analyze storage system data. NovusCG claims a number of blue chip customers, including the U.S. Department of Defense and the Department of Homeland Security. Other large financial institutions are clients, the company claims, but has not publicly announced their names.
"I've seen their client list, and it's hard to tell how broad the deployments are, but the names are impressive," said Forrester Research analyst Andrew Reichman. "They've been tightly partnered with IBM and gaining entrance into some petabyte-plus shops."
Reichman said NovusCG's consulting background is the key to its ability to land large customers. NovusCG also offers professional services with its software. "One of the biggest failures of SRM is that vendors tend to ship a CD and expect companies to know what to look at -- you still need people who know how to interpret and analyze the information," Reichman said.
A new strategic direction for IBM?
The acquisition comes during a great deal of speculation about the direction of IBM's storage division. Yesterday, IBM unveiled updates to its DS8000 high-end array that left experts underwhelmed. Competitors, meanwhile, have been claiming the product is dead despite the updates. There are even more questions hanging in the air about the DS6000 midrange product line.
"The DS6000 sure has not benefited from feature-functionality upgrades in quite some time," said Evaluator Group analyst Tom Trainer. "The clients we talk to use it primarily as a target for small data set replications using PPRC, Metro Mirror or Global Mirror."
Yesterday's DS8000 announcement will be encouraging for existing customers, Trainer said, but leaves out key features offered by competitors, including MAID, data deduplication and support for 1 TB drives. "It raises the question, are they just trying to keep that product going while making a long-term decision?" he asked.
Sources close to the company said that IBM has recently shifted personnel between the Tivoli and System Storage groups, bringing the same people who worked to integrate Tivoli Productivity Center to do similar work with IBM's new System Storage Productivity Center (SSPC).
"Tivoli still has some command-line interfaces and complexity, but it's hardly the beast it was several years ago," one source said. "Time will tell if they can bring that to storage."
NovusCG could help. "The people they're getting from Novus bring deep knowledge of storage that's in excellent position to be a shot in the arm to both IBM's storage R&D and its field support," said Tony Asaro, senior analyst with the Enterprise Strategy Group (ESG).
However, Asaro pointed out, IBM said it intended to create a similar splash in the storage market after it acquired data migration software vendor Softek Storage Solutions Corp. in January. "They still have the old Softek site up, and we haven't heard from IBM about Softek since. They're making big moves, but are they really leveraging them to their advantage?"
Trainer predicted that tectonic shifts in the competitive picture lie ahead. IBM, EMC and HDS are the three major high-end array vendors, with HP and Sun Microsystems Inc. reselling HDS systems. "The three player game in storage is starting to heat up again," he said, but estimated "a better than 50/50 chance" IBM would find a partner for its high-end storage offering. "HDS is the most likely candidate, since EMC and IBM are historical rivals," he said.
There's also sentiment on Wall Street that an OEM deal would be the right move for IBM. "I think they should just swallow their egos, give up on the high end and resell EMC or HDS," said a financial analyst who asked not to be named. "IBM is a services company now. And they are doing a good job there. Focus on your strengths and let loose your weaker segments."