In a partnership that unites two units of EMC (NYSE: EMC), Iomega has unveiled two NAS devices certified for VMware (NYSE: VMW) for small businesses and remote offices.
The Iomega StorCenter ix2 and Iomega StorCenter Pro ix4-100 desktop network start at $300 for one terabyte of data and are aimed at companies with under a hundred users. The new data storage offerings are the clearest indicator yet that storage titan EMC, Iomega’s parent company and the majority owner in VMware, sees big money in the SMB sector.
Iomega said the move illustrates the first steps in bringing traditionally high-end storage technologies to smaller enterprises and EMC’s cohesive strategy behind its Iomega and VMware product portfolios. EMC bought VMware for $635 million in 2004 and acquired Iomega for $213 million last year.
“There is a wide range of technology being developed, and this is just one piece that meets the overall needs of SMBs. These companies can now achieve the benefits of VMware at a price point they can afford,” said Jonathan Huberman, president of Iomega and the Consumer and Small Business Products Division of EMC.
According to Iomega, a small business running Microsoft Exchange on one server and Microsoft Dynamics GP ERP on another can consolidate both applications on one single server with VMware and an Iomega ix2 or ix4-100 NAS. That ability, said Huberman, reduces server costs as well as operational costs such as power consumption and server management time.
The products are good fit for remote office locations, as these environments typically don’t have full time IT staff for managing VMware deployments, said Huberman.
EMC, VMware Close Ranks
Strategically, it could also illustrate EMC strategy’s in melding VMware into its expansive storage portfolio. The issue has been a hot button between EMC and VMware following the acquisition and played a role in VMware CEO Diane Greene being ousted by EMC last year.
Greene’s insistence on VMware’s independence meant EMC salespeople could not sell VMware bundled with storage solutions. As competitors such as Microsoft ramp up their own virtualization offerings, industry observers have said they expect to see more bundling of VMware in EMC products. Last July, VMware unveiled its latest version of its ESXi 3.5 hypervisor, Version 2.5, available at no charge in its competitive play against Microsoft’s Hyper-V.
EMC said it does not sell VMware licenses and now serves as a VMware authorized consultant. “We just build solutions and make as many of our solutions, where possible, optimized for VMware environments,” corporate spokesperson Todd Cadley said.
Not Aimed at NetApp — Yet
Delving deep into the SMB venue could pay off big time, as it’s viewed as a largely untapped but highly lucrative market, with no single dominant player. In buying Iomega, EMC gained a huge customer footprint and a deep channel, which better positioned it against other strong SMB market competitors such as Dell (NASDAQ: DELL) and HP (NYSE: HPQ).
The latest move by Iomega to bundle virtualization into its SMB storage offerings could be a big advantage, noted one analyst.
“Virtualization has always had a layer of complexity that didn’t lend itself to small shops with little or no IT resources. With this they’ve created a line of NAS devices already certified for virtualization and providing a plug-in solution,” said Charles King, principal analyst at Pund-IT.
“All the vendors are moving down into the market, but providing a pre-configured and pre-optimized offering at such an aggressive price gives EMC equal footing against HP and NetApp,” said King, noting that HP and NetApp (NASDAQ: NTAP) both offer storage products bundled with VMware.
But Iomega’s Huberman said Iomega doesn’t view itself as a NetApp competitor, as the new offerings do little to bridge the gap between Iomega’s low-end products and EMC’s $20,000 NX4.
“We are not saying we are a NetApp play. But if a company doesn’t need a NetApp, this gives them what they need to do virtualization,” he said.
Asked if Iomega might yet challenge NetApp by moving up market, an Iomega spokesperson suggested that might be the plan: “Iomega will continue to introduce new network storage solutions for small businesses, remote workgroups and other similarly sized entities that increase in terms of both capacity and features, including utilizing EMC enterprise storage and security technologies. Expect more Iomega NAS appliances in 2009.”
Brad Bunce, EMC’s director of IP storage product marketing, said earlier this week that the company may try to challenge NetApp on the low end by beefing up its Iomega line.
The StorCenter ix2, which can support groups of 12 users or less, is priced at $299.95 for the 1TB capacity unit, and $479.95 for a 2-TB capacity unit. The StorCenter Pro ix4-100 NAS Server, geared for up to 25 users, is available in a 2TB unit for $799.95 and a 4-TB unit for $1,299.95.