Four months after its $1.4 billion acquisition of iSCSI SAN vendor EqualLogic Corp., Dell today moved to acquire enterprise storage software player MessageOne Inc., which was founded by Michael Dell's brother Adam Dell. The deal is worth $155 million in cash, pending regulatory approval.
The acquisition comes as the email archiving market is heating up with the emergence of new Storage as a Service (storage SaaS) email archiving products from Google and MessageOne, and smaller archiving acquisitions by storage software companies Atempo Inc. and TeraCloud Inc.
The Dell acquisition and MessageOne service launch this week have set up a new heavyweight battle in the storage industry: Google vs. Dell. Google has relaunched the online email archiving, email discovery and messaging security services of its subsidiary Postini Inc., which it purchased for $625 million last July.
According to detailed documentation on the launch published by Google online, release 6.13 of Postini Message Archiving includes an enhanced GUI, an automated purge option and support for Google's Gmail Web-based email systems, as well as integration with Google Apps Premier Edition. Google has ported its search functionality into Postini. It includes basic Google search and offers discovery search as an option. There's also the option of message consolidation, and search and Web-based access to a personal archive for users.
Just before Dell bought the company, MessageOne launched a new rapid-archiving service of its own meant to undercut Google on price. Google's price tag of $25 per-user annually for its archiving service prompted MessageOne to create a Rapid Archive offering that can be deployed quickly and costs $1 per user per month -- about half the price of Google's service.
Rapid Archiving comes with up to 100 MB of storage per user and a default 60- to 90-day retention policy. Customers can add storage or longer retention plans for $1/GB per month. Since it's meant as a way for users to get an almost instant 90-day archive, it doesn't include all the features of MessageOne's Enterprise Archive, such as stubbing messages for storage management and disaster recovery features for email servers.
According to a Dell spokesman, MessageOne's offerings will be slotted into Dell's services portfolio alongside other recently acquired IP from services companies, such as software licensing management SaaS player ASAP Software and remote systems management SaaS provider Everdream Corp. "What we want to do is package our [SaaS] offerings for customers to pick and choose what they need from a menu," said David Lord, a Dell spokesman.
Lord didn't rule out further acquisition activity from Dell to get deeper into storage. "We've evolved as a company from primarily focusing on organic growth to acquiring IP as needed," he said.
According to Forrester Research senior analyst Stephanie Balaouras, Dell, in its acquisition of MessageOne, has grabbed a top-notch play in email and archiving. "MessageOne is the leader in email continuity and archiving," she said. "A lot of other service providers rely on them as well, like SunGard. They are definitely best-of-breed."
Dell said MessageOne's existing partnerships, most notably one with Iron Mountain Inc., will continue.
Meanwhile, Google is still new to the enterprise archiving space and still has some kinks to work out. According to release notes published on the Web by Google, version 6.13 has some known bugs around its Auto-purge message deletion option that are supposed to be addressed in an upcoming maintenance release. For existing users of Message Archiving, the default setting for Auto-purge is off with 6.13. Turning it on requires users to manually purge messages already archived. Users have also reported that message purges are not always displayed in the purge history or recorded as an audit record. Similarly, the number of messages in a result set has not updated after purging for some users.
"For traditional enterprise companies, I think they're more likely to turn to more staid vendors [such as] Iron Mountain, EMC, Symantec [and] IBM … for information management and infrastructure services," Balaouras said. "The biggest concern these customers have is security of their data in a multitenant environment and customer service."
Balaouras went further in a blog post on the Forrester site. "Dell's acquisition of MessageOne is good for IT Infrastructure and Operations professionals," she wrote. "Increased competition will force the more rapid development of additional SaaS services for information management and infrastructure, and it will put pressure not only on pricing but on improved customer service."
Atempo, TeraCloud refocus on e-discovery
Backup and recovery software maker Atempo has seen the e-discovery and archiving writing on the wall and joined the archiving market on Tuesday with the acquisition of Lighthouse Global Technologies Inc. Meanwhile, Teracloud brought its founder back into the fold with the acquisition of e-discovery software startup Estorian Corp. and is relaunching as an e-discovery company under the Estorian name.
Balaouras predicts that storage services will be the wave of the future for SMBs. SMBs "are more likely to pursue the SaaS approach, rather than manage their own premise-based deployments of backup and archiving solutions," she said.