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5/21/2009
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George Crump
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NetApp Buys Data Domain - User Impact

With yesterdays announcement of NetApp's intention to buy Data Domain, a question that needs to be answered by IT professionals is how does this affect them? In our blog on Information Week's sister publication Byte and Switch we looked at the industry impact, but what about the users? There are current customers, c

With yesterdays announcement of NetApp's intention to buy Data Domain, a question that needs to be answered by IT professionals is how does this affect them? In our blog on Information Week's sister publication Byte and Switch we looked at the industry impact, but what about the users? There are current customers, companies that were thinking about buying Data Domain and of course companies that were using an alternative solution. How should each of these parties take this news?First remember that the sale is not official yet and even when it is any real functional change in products will take months if not years to occur. The only fear would be if the acquisition lead to the demise of the Data Domain technology and of all the things to worry about, that is not one of them. You don't pay $1.5 Billion for something and then shut it down, in fact you try real hard not to mess it up.

Current Data Domain Customers

No real change is needed here. I would not be concerned at all about your current products and while there may be a potential slow down in development as part of the integration efforts, I don't expect that to happen. If NetApp is smart they will leave Data Domain as a stand alone entity for a while, integrate where it makes sense, but leaving the core product alone. I expect that to happen.

Current NetApp Customers

For current NetApp customers, things just got a little interesting. NetApp offers it's deduplication technology for free and, according to NetApp anyway, a high percentage of them have enabled it. Certainly if you are one of those customers that has it running don't turn it off, but if you have not enabled it yet, you may want to wait.

As we found in a recent lab test of the NetApp deduplication solution, it does have some weaknesses, and apparently they were concerned enough that they spent a fair amount of money, paying a 40% premium to fix it. If you had not enabled the current NetApp deduplication you may want to wait for a bit to see what NetApp intends to do with their current products and how they might integrate the Data Domain technology into their core products.

You may find that NetApp changes nothing on their core products and keeps the Data Domain technologies as a backup only technology, but as we point out in our recent article "The Role of Compression vs. Deduplication in Primary Storage", NetApp would do well to leverage the technology so they could gain a compression capability along with deduplication.

Potential Customers

If you are evaluating a Data Domain solution right now I'd suggest continuing, especially if it is primarily for backup, even if you are not a NetApp customer. There is little overlap here between the two companies products. While NetApp has a VTL product it has not been nearly as successful as the Data Domain systems. Again I doubt seriously NetApp will do anything that will negatively impact Data Domain in this market.

If you are evaluating NetApp for a primary storage solution I would continue to include them in that mix. The only change that I would make is considering not using their deduplication technology until you can understand what, if any, of the Data Domain technology NetApp intends to incorporate into their core products.

If you are looking at a primary storage optimization solution, you may want to look at some of the storage agnostic solutions like those from Ocarina Networks, Storwize or others to compliment your primary storage selection.

Using an Alternative Solution

If you are already using an alternative solution the first area of impact on you is if something amazing comes out of this relationship that changes the deduplication market. If this happens, it is not going to happen for a while, so if you are happy with your current deduplication strategy, stay put.

The other impact however is your current deduplication technology may be bought by a larger company, but it is hard to know what the reaction of some of the larger storage companies is really going to be, despite what their initial statements will say this week.

All in all this might be that rare acquisition that is good for both companies involved in the transaction and for the storage community in general, but only time will tell.

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George Crump is founder of Storage Switzerland, an analyst firm focused on the virtualization and storage marketplaces. It provides strategic consulting and analysis to storage users, suppliers, and integrators. An industry veteran of more than 25 years, Crump has held engineering and sales positions at various IT industry manufacturers and integrators. Prior to Storage Switzerland, he was CTO at one of the nation's largest integrators.

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