Winston Churchill said it best: “There are a terrible lot of lies going about the world, and the worst of it is that half of them are true.”
But which of the many IT and data storage rumors are true and which are hogwash? Take your pick.
1. IBM or Oracle to buy EMC
On a train to New York last month, a pleasant executive from a large financial institution was fascinated to learn of my occupation. After pumping me for the latest gossip, he proceeded to inform me that EMC (NYSE: EMC) had been sold to either IBM (NYSE: IBM) or Oracle (NASDAQ: ORCL) and that the details were being hushed up until an announcement came forth in August. He presented it as a done deal not as hearsay or rumor.
2. Microsoft to buy SAP
The same person said that another big merger was looming. Microsoft (NASDAQ: MSFT) was set to swoop for SAP (NYSE: SAP), the enterprise resource planning (ERP) and enterprise financials leader. If true, it would seem that Microsoft is trying to cement its position as the top software provider in markets less likely to be overrun by the cloud.
3. IBM to acquire Storwize
Whenever takeovers are mentioned, IBM is never far from the discussion. With Storwize specializing in data compression, this could mean IBM is trying to acquire it to compete with IBM in the midrange and high end. EMC recently announced that it had added data compression to its CLARiiON arrays. But then why bother if IBM really intends to buy EMC?
There are the rumors of Storwize and IBM which, with Ed Walsh being brought in as CEO late last year, would be about surprising as the sun rising in the east and setting in the west,” said Greg Schulz, an analyst with StorageIO Group. “The question is will it be IBM or someone else and for how much.”
(Editor’s Note: Sometimes the rumor mill gets it right. IBM made its acquisition of Storwize official yesterday, buying the company for a rumored $140 million. See “IBM to Buy Storwize for Real-Time Data Compression”)
4. EMC to be gobbled up by Cisco – or is it HP?
No matter how often EMC chairman Joe Tucci denies it, the press won’t let up about a pending merger. The company’s strong partnership with Cisco (NASDAQ: CSCO) over cloud computing has added further fuel to this fire, but is there anything to it? Schulz believes not.
His logic is simple: If HP (NYSE: HPQ) can’t afford to buy EMC as some have said, then how could the much smaller Cisco pull it off?
“EMC will probably remain independent for now,” said Schulz. “If there were an acquisition I see HP as more likely than Cisco given strong synergies from a business, financial, product and other fit.”
He pointed out that there are a lot of ex-DECies at EMC (Digital Equipment Corp. became Compaq, which became HP) as well as some ex-HP and Compaq folks. Likewise, there are some ex-EMC folks at HP – and HP used to resell EMC Symmetrix and CLARiiON gear.
Giving more substance to the Cisco/EMC deal, though, is the relentless progress of convergence between storage and networking. EMC’s recent 10 Gigabit Ethernet (GbE) announcement appeared to substantiate the fact that EMC sees the writing on the wall for Fibre Channel (FC) in the long term. Despite Tucci’s best efforts over the past decade, hardware is still half of EMC’s total pie, and FC gear makes up the bulk of that revenue. So amid EMC’s acquiescence to 10GbE and rumors of the unification of its Symmetrix and CLARiiON lines, things could all be the setting of the stage for a grand Cisco take over.
5. Brocade is trying to be acquired
So many tales swirling about Brocade! It seems this company (and EMC) has become as much tabloid fodder as Brad and Angelina. Some say Brocade (NASDAQ: BRCD) was actively shopping itself around last year. Brocade denies any such mutterings. Schulz agrees.
“I don’t see Brocade needing to be sold anytime soon as some have speculated,” he said. “However, if I had to cast a prediction, it would not be HP, IBM, Oracle, or any of the other big server/storage vendors, rather a more natural fit in the form of telecom provider Huawei.”
6. Symantec pulls the plug on professional services
Another analyst, who asked not to be named, played tittle-tattle on Symantec. He said the storage and security vendor is about to drop out of the professional services market, leaving all that business for its resellers.
“This is an interesting opportunity for channel partners to pick up some high margin business,” said this analyst. “But is Symantec really going to walk away from its major accounts, which prefer to deal directly with their vendors?”
7. Intel Buys EMC
Many are fixated on the possibility that Cisco will buy EMC in order to go after IBM and HP with a full stack. Certainly, what a powerhouse that would be. But what if that is just a smoke screen for what is really going on? Yet another analyst who shall remain nameless implied that maybe it’s really Intel (NASDAQ: INTC) that is after EMC. After all, Paul Gelsinger recently moved from Intel to EMC and now holds a very senior position.
“What if it turns out Gelsinger was brought in to make Intel/EMC happen?” said that analyst. “Intel and VMware/EMC might completely commoditize the server and storage markets.”
8. IBM buys NetApp
This one has been going on so long that it is almost a golden oldie. But some analysts see it is making sense.
“IBM is just getting into true NAS on its own and has SONAS at the mid-to-high end,” said one commentator. But there are a lot of legs left for NetApp as a broad unified storage portfolio play that will help IBM keep EMC out of its accounts.”
That is, unless IBM buys EMC or Cisco buys NetApp or Microsoft buys …
9. Oracle dumps Hitachi and LSI as partners
Ifs, ifs and more ifs! It has been reported that Oracle plans to stop reselling high-end storage networking arrays from Hitachi Data Systems, ending a long established Sun-HDS partnership. That has fueled speculation that other aging Sun partnerships, such as that with LSI, are also on the chopping block. This, of course, adds strength to those stories about Oracle aiming for EMC. But then, maybe Oracle just wants to package up some Sun gear and use it with Oracle apps. Or maybe a new partnership with EMC will unfold.
10. Cisco decides to own the entire networking, storage and server hardware stack
Looking at the more unlikely scenarios, Schulz wonders if Cisco might finally decide to go all-in on the server front, thereby taking on Dell, HP, IBM, Oracle and many others in more than just a token manner.
“This could launch a mad scenario, that is, an all out battle that results in Mutually Assured Destruction. I don’t see that happening soon,” said Schulz.
Note that EMC, NetApp, Brocade, HP, Cisco, IBM, Oracle and many others are hard at work to emphatically deny these stories. Good luck with that.
“Trying to squash a rumor is like trying to un-ring a bell,” said U.S. journalist Shana Alexander.
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Drew Robb is a freelance writer specializing in technology and engineering. Currently living in California, he is originally from Scotland, where he received a degree in geology and geography from the University of Strathclyde. He is the author of Server Disk Management in a Windows Environment (CRC Press).