EMC, Microsoft take cue from Obama

In a public show of solidarity earlier this week, EMC Corp CEO Joe Tucci and Microsoft Corp. CEO Steve Ballmer announced an extension of their companies’ long-standing strategic partnership until 2011.

During the conference, held Tuesday in New York, the tech giants vowed to work together and help customers weather the continuing economic storm. The companies promised to focus on storage and information protection in virtualized environments, help organizations cope with growing amounts of information spread, and fight against data breaches.

“They are taking the advice of Obama’s chief of staff [Rahm Emanuel] who said to ‘never let a good crisis go to waste,’” Brian Babineau, senior analyst at Enterprise Strategy Group, said. “Customers are going to work with vendors that are stable, have a good balance sheet and will be around for the long term. Anytime you put two of those vendors together to help customers solve common problems, that risk is even further mitigated.”

The fact that the companies chose to extend the alliance in New York, Babineau added, was also very telling.

“You want to talk about a city full of CEOs and major companies that need to be risk adverse? New York is the place to be,” he said. “There’s no more room for error at companies that want to bet big and start buying IT in New York.”

With data growth projected somewhere between 30 and 40 per cent for 2009 and IT budgets growing nowhere near that rate, Babineau said the EMC-Microsoft alliance will appeal to many such enterprises.

“Customers should care because they’re going to have to deal with information management, information storage and information security,” he added.

As part of the strategic plan, EMC and Microsoft want to continue developing solutions that work well together. For example, a customer looking to deploy Microsoft Hyper-V will want to know that it will be fully functional with EMC Clarion SAN disk arrays.

“Microsoft will also continue building data-loss prevention technology from RSA into their products and I expect to see much more of that as we move toward the Windows 7 release,” Charles King, a principal analyst with Pund-IT Research Inc., said.

Another area to watch for, King said, is EMC’s continued development of solutions that enable customers to use familiar Microsoft Office and SharePoint interfaces to interact with EMC stored, protected and managed content.

“Ultimately, continuing the alliance leverages both companies strengths into opportunities that benefit EMC, Microsoft and their customers,” he added.

According to David Senf, director of security and software research at IDC Canada, customers can expect to see a lot more “co-opetition” as the market continues to consolidate and large vendors buy up smaller ones at bargain prices.

“You might see similar announcements like this as larger vendors try to ensure the customer base that buying a given technology will help them avoid risk,” he said.

With storage and information protection in virtualized environments one of the issues singled out during this week’s press conference, EMC’s controlling stake in virtualization giant VMware Inc. has become an issue of discussion.

But according to Babineau, while EMC has a favourite horse in the server virtualization race, they can’t stay bound to that horse in all areas of the virtualization spectrum.

“They have to place some other bets,” he said. “The equivalent is when EMC came out as a storage systems vendor. They had to support multiple operating systems and couldn’t just support Unix, because they knew customers were going to have Windows, Linux and mainframe setups.”

“VMware and Hyper-V are essentially flavours of an operating system that they’re going to have to support,” he added.

Babineau cited recent Enterprise Strategy Group research that linked server virtualization as a key driver to network storage deployments.

“So, will EMC actively go out and say that Hyper-V is better than VMware? Probably not,” he said. “But if a customer says ‘we’re going to standardize on Hyper-V, what can you do for us?’ I guarantee you that from a storage perspective; EMC will have a good answer for them.”

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