Wednesday, August 19, 2015

$694M of Respect: Dot Hill & Seagate

The Rodney Dangerfield of storage, Dot Hill, earned the acquisition premium from Seagate. 
Dot Hill never got to be big enough, smart enough, clever enough to be their own brand, but they pushed on as the primary provider of good-enough, clever-enough, robust-enough storage behind many other brands. They never got respect, but a lot of people knew them and liked them.

Dot Hill never created a storage brand for themselves because they didn't have the proprietary software team(s) required to deliver storage for the previous decade. They were pushing the boundary of enterprise storage with new de-dupe, compression, DR technology. They didn't invent new protocols and clustered scale-out systems. They stuck to what they did well, which was a really solid disk array. It wasn't sexy and that's OK.

Times have changed. That software that EMC, NetApp and others locked so tightly into their boxes is breaking free. Software-Defined-Storage of all sorts has cracked the box and all that magic software is now available to run on x86 servers with 'good-enough' storage arrays as the target. Even worse, SDS allows mixing heterogenous storage into single pools that are transparent to the user.

And, that is what defines a mature, commoditized market.  Seagate has been in that business for years. They know how to extract value from incremental innovations and profit from supply chains.

Dot Hill outlasted, not outwitted. For the next battle, they needed to get bigger. Seagate is bigger.

My reading list:
Joe Landman's few words...

El Reg's Take

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