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EMC strikes global OEM deal with Intel

Extending its channel strategy away from relying too heavily on Dell, EMC signs a global OEM deal with Intel.

SAN DIEGO -- EMC Corp. announced Tuesday a worldwide OEM agreement with Intel Corp., focused on small and midsized businesses (SMBs) in overseas markets. The deal highlights EMC's eagerness to broaden its channel beyond North America and notably beyond relying too heavily on Dell Inc. – its No.1 channel partner to date.

Intel will offer the new AX150 and AX150i through its network of over 160,000 distributors and resellers in Asia-Pacific, Eastern Europe and South America. The product will also be available through Intel's resellers in North America, although the training and sales focus is on emerging markets overseas.

Resellers will sell the box, priced at around $6,000 for an entry-level system, under their own private brands, modifying the software and packaging it with servers to suit their customer base.

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"Selling to SMBs is not just about servers but servers and storage …EMC's box is small, it's easy to use, and it's a trusted brand which is extremely important for resellers," said Hanz Geyer, vice president and general manager of Intel's storage group.

As well as extending its product offering into storage, Intel is hoping to learn something from the technology that it can incorporate back into its server portfolio. "There are a number of CPU architecture features that show up in storage before servers, such as 64-bits, high-memory bus bandwidth and high I/O throughput," Geyer said. "It enables us to have a better server portfolio."

The chip giant also sells LeftHand Networks Inc.'s SAN/IQ software on Intel Xeon processors, creating "storage modules" that can be aggregated together to form a scalable pool of storage managed from a single interface. However, it appears that Intel hasn't had much success selling this product.

"The scale-out approach is more complicated … as a consequence it's much harder to sell," Geyer said. He added that EMC's AX150 is "the most complete solution in the white-box space."

The AX150 for Fibre Channel connectivity and AX150i for iSCSI connectivity can support up to 10 host servers and scales from 750 GB to six terabytes of capacity. Features include support for SATA II drives, for higher capacity and performance than previous SATA drives; iSCSI installation wizards; support for up to eight concurrent array-based data snapshots; and the option of a dual controller and redundant power supply.

Dell is also selling the AX150, but primarily in North America as it does not have a big presence in emerging markets. However, the competition it now faces against Intel is obvious from this response to the deal, received via e-mail.

"This announcement reflects the leadership and influence Dell has established in the entry storage space. Two years ago, Dell was the only company to offer a customer-installable affordable SAN for under $10,000 in collaboration with EMC. Since then, we've achieved tremendous momentum as the fastest growing top10 disk storage systems vendor. This market is growing rapidly and we're certainly not surprised that others are trying to achieve the same level of success," said a company spokesperson.

Meanwhile, EMC is maintaining the appearance of a happy marriage. "Our relationship with Dell has never been better," said Mitch Breen, senior vice president of global channel sales and marketing.

Brian Babineau, analyst with the Enterprise Strategy Group, notes that it could also be an opportunity for the three companies to come closer together. "As those [emerging] markets grow out of the AX150 they can grow into what Dell sells from EMC … Sure there will be competition," he said. "But if you don't have that, you're not covering the whole market.

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