NetApp CEO Tom Georgens said his company's $480 million acquisition of LSI Corp.'s Engenio storage systems was about expanding the workloads that NetApp can address. NetApp will target the Engenio block storage systems at video and other high-performance computing (HPC) markets while continuing to push the NetApp FAS platform at virtualized infrastructures.
"We serve our core business with our existing technology," Georgens said. "This is about incremental workloads that we can add to our portfolio."
Georgens said LSI's storage is performance oriented and doesn't concentrate on "sophisticated" features such as deduplication, cloning, and replication that NetApp includes. "It [LSI] is optimized for price performance, specifically around bandwidth, and less of an effort to supply software services," he said. "These systems are not targeted at traditional business applications, but applications that push the bandwidth envelope particularly hard. We're not going to pull Data Ontap in that direction at the expense of our core business."
He mentioned full-motion video capture, digital video surveillance, genomics sequencing and scientific research as applications addressed by the Engenio storage.
In the past, NetApp seemed to be looking to go after the performance market with technology it acquired from Spinnaker Networks Inc. in 2003. While Spinnaker code is in NetApp's Ontap 8.0 cluster mode (formerly GX) operating system, Georgens said that's better suited for more traditional applications. Spinnaker technology is for file data, while LSI's storage is oriented to block data storage.
"Cluster mode brings performance, but aimed at traditional biz customers," Georgens said. "This product [Engenio] is aimed at brute performance.
Engenio's all about block storage
NetApp rival EMC Corp. also took a huge step into the video and HPC markets when it spent $2.25 billion on Isilon Systems Inc. late last year. However, Isilon is also a file-based architecture although it recently added iSCSI capability. The Engenio storage is Fibre Channel based with no network-attached storage (NAS) functionality.
"This is a block-based system," said Randy Kerns, an analyst at Evaluator Group. "It is high performance, much better performance than NetApp could achieve in block operations. It could go into markets where NetApp couldn't play."
However, Enterprise Strategy Group senior analyst Mark Peters said NetApp will want to avoid the perception that Engenio storage is its Fibre Channel storage and FAS is its NAS platform. (IBM, which sells both Engenio and NetApp storage through OEM deals, positions NetApp strictly as NAS play).
"They don't want to get to where NetApp is their NAS box and LSI is their Fibre Channel box," Peters said. "NetApp already does Fibre Channel. It just has to use LSI to get more credibility [in new markets]."
For years, NetApp executives have emphasized that having one unified platform sets it apart from their major competitors who sell different platforms in the midrange and enterprise and for NAS and SAN customers. Now that it has two platforms, it will try to draw a strong line between them. The firm's Georgens said NetApp's new portfolio will be different than EMC's situation with its midrange Clariion and enterprise Symmetrix platforms.
"The problem with Symmetrix and Clariion is the target markets are overlapping," he said. "They all have replication, snapshots and other things in parallel. This [LSI] is not our SAN product. We have a SAN product called FAS. This [Engenio] is targeted at workloads where we're not going to sell FAS."
Engenio systems are sold exclusively through OEMs. IBM is the largest, but Dell, Oracle, SGI and Teradata are other partners. Georgens said he will try to maintain those relationships, and he also plans to sell Engenio systems through NetApp channels for certain verticals.
The main Engenio systems are the 7900 high-performance system and the 6998 and 4900 midrange platforms. IBM sells Engenio systems as the DS5000 and DS3400. Oracle also sells Engenio as the Sun Storage 6580 Array.
The deal is expected to close in approximately 60 days.
LSI keeps its NAS technology
NetApp won't get the ONStor NAS technology LSI acquired in 2009. That business will stay with LSI. Engenio was working on incorporating ONStor into a unified storage system, but hasn't brought it to market. Outside of ONStor, LSI will now focus on its semiconductor business. It will keep its RAID adapter (MegaRAID and 3ware) storage controllers, SAS chips and switches, PCIe solid-state drive (SSD) cards and software for direct-attached storage.
Mitch Seigle, LSI's vice president of corporate marketing, said most of the 1,200 employees who worked on the external storage business will transfer to NetApp, but the final number is not yet set.