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IBM, ADIC swap patents

There's more action in the tape market as IBM and ADIC cement their relationship in the face of increasing competition

ADIC Corp., a long-time supplier of tape libraries to IBM, announced this week that the two companies have signed a broad patent cross-licensing agreement covering their respective portfolios in storage.

On the face of it, pretty bland news, but reading between the lines, analysts said the deal suggests the two firms may be closing ranks in the face of increasing competition. Rumors that EMC Corp. and StorageTek Corp. are on the verge of hammering out a deal have been doing the rounds for months.

"An announcement like this allows them [IBM and ADIC] to work more closely together, sharing ideas and intellectual property freely without fear of lawsuits or doing anything that might be deemed inappropriate down the line," said Eley Thompson, patent attorney with Leydig, Voit and Mayer Ltd.

Swapping patents at this level also speeds up time to market for new products, and it should mean better integration between existing products, industry experts said. John McArthur, director of storage research at IDC Corp said the relationship between ADIC and IBM is close and appears to be getting closer. "IBM is moving a lot of ADIC libraries, and ADIC is helping move a lot of IBM LTO drives. It doesn't have to be a marriage, but the relationship is serious."

The details of the cross-licensing agreement are "mired in the lawyers," said an ADIC spokesman, and much of the information is undisclosed. However, he said that in addition to the patent deal, ADIC will license IBM's technology that integrates its drives into ADIC's tape libraries.

Earlier this year, ADIC was reportedly in talks with EMC, but this would seem less likely in light of its deal with IBM. EMC has openly stated its intention to beef up its tape portfolio -- right now it resells Quantum's tape libraries but that's about it.

"It's fair to say in the storage world that there are all kinds of partnerships and constantly shifting alliances. This announcement indicates that our relationship with IBM is still going strong and that we are looking for ways to further cement it," the ADIC spokesman said.

According to the latest market research from Gartner Dataquest Inc., ADIC own 30% of the market for tape libraries in the open systems backup sector, which puts it in the top spot. Gartner reports that ADIC is well-positioned to take advantage of the shift away from mainframe libraries and toward moderately- priced, open systems drives like LTO and Super DLT.

Separately, IBM announced that Imation Corp. will resell its high capacity 3592 tape cartridge, which offers users up to 300 GB of storage capacity and a transfer rate of 40 megabytes per second.


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