IBM Annexes XIV

IBM started the new year on the acquisition trail, picking up Israel-based storage startup XIV Ltd. for a reported $300 million to $350 million.

XIV makes Nextra, a storage system based on a grid of commodity hardware that includes features such as thin provisioning, snapshots and remote mirroring.

The company, founded by former EMC chief engineer Moshe Yanai, has shipped about 4 petabytes of high-performance storage in the last couple of years. But rather than adding another general storage line, IBM plans to target the company’s technology at next-generation digital content.

“IBM is positioning this acquisition and the Nextra solution in the emerging applications space — Web 2.0, video surveillance, rich media, etc., whereas I would guess that XIV has been selling in the more general purpose application space that products like EMC Symmetrix occupy,” said John Webster, principal IT advisor at Illuminata. “So right now, there is a positioning wall between Nextra and IBM’s established storage lines.”

XIV, its technologies and employees will become part of the IBM System Storage business unit of the IBM Systems and Technology Group, and IBM plans to discuss integration plans as they develop over time.

IBM is billing the acquisition as the first major deal for the IBM Systems and Technology Group in nearly a decade.

“The acquisition of XIV will further strengthen the IBM infrastructure portfolio long term and put IBM in the best position to address emerging storage opportunities like Web 2.0 applications, digital archives and digital media,” Andy Monshaw, general manager of IBM System Storage, said in a statement.

“The ability for almost anyone to create digital content at any time has accelerated the need for a whole new way of applying infrastructure solutions to the new world of digital information,” he said. “IBM’s goal is to provide the leading technologies and solutions at every layer of the data center — storage, servers, software and services — to address these new realities IT customers face.”

IBM said it was impressed by Nextra’s ability to scale dynamically, heal itself and self-tune while eliminating the management burdens associated with rapid growth environments. The architecture also automatically optimizes resource utilization of all components within the system, allowing for easier management and configuration and improved performance and data availability.

“We believe the level of technological innovation achieved by our development team is unparalleled in the storage industry,” boasted Yanai, who is credited with the development of EMC’s high-end Symmetrix system. “Combining our storage architectural advancements with IBM’s world-wide research, sales, service, manufacturing and distribution capabilities will provide us with the ability to have these technologies tackle the emerging Web 2.0 technology needs and reach every corner of the world.”

IBM isn’t the only storage company that spent the holidays making strategic acquisitions. EMC announced that it is buying publicly-held Document Sciences Corp. for $85 million. Document Sciences makes document output management (DOM) software that facilitates personalized, multi-channel communications with customers, partners and suppliers, adding to EMC’s position in the transactional content management (TCM) space, the fastest-growing segment of enterprise content management.

And Double-Take Software acquired CDP startup TimeSpring to bolster its data protection and backup capabilities for virtualized and physical server environments.

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