EMC and Quantum join forces on deduplication

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EMC and Quantum join forces on deduplication

Dave Raffo, News Director

EMC and Quantum are ganging up on Data Domain with an OEM deal for EMC to sell Quantum's deduplication software on its virtual tape libraries (VTL).

Quantum disclosed in a January US Securities and Exchange Commission (SEC) filing that it has signed a deal with a major OEM to license its data deduplication and replication software. The industry buzz said EMC was the partner, although EMC already uses FalconStor software for its EMC disk library VTL and had acquired data deduplication software startup Avamar Technologies in 2006. Now sources have confirmed the partnership to SearchStorage.com and EMC is expected to make it public soon.

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We suspect EMC sales and marketing muscle will be able to disrupt Data Domain
Tom Curlin
financial analystRBC Capital Markets
Financial analyst Tom Curlin of RBC Capital Markets wrote in a note to clients that EMC is already selling the deduplication product and will officially launch it soon.

"We suspect this is a move by EMC to compete more effectively versus Data Domain," Curlin wrote. "And while contacts believe they have chosen a technically inferior solution, we suspect EMC sales and marketing muscle will at least be able to disrupt some of Data Domain's muscle. Notably absent from EMC's deduplication plans is the FalconStor offering, despite EMC already having a relationship with them for their virtual tape offering."

Another source familiar with the deal, who did not want to be named, said EMC will continue to use FalconStor software on its VTLs, but it had decided not to use FalconStor for deduplication because FalconStor refused to offer EMC the product exclusively. EMC did not want to sell the same deduplication as FalconStor's other partners, which include EMC rivals IBM and Sun Microsystems, the source said. He added that EMC did not use the Avamar technology for its VTL because it did not scale effectively enough to be cost effective. EMC sells Avamar deduplication in a separate backup appliance and as part of its NetWorker data protection application.

An EMC spokesman said, "We don't comment on any speculation" when asked about the Quantum deal, but added, "Let's just say our relationship with FalconStor is still strong."

Mike Sparks, Quantum's product manager for enterprise disk systems, said he couldn't comment on who the partner is or when the product would be released. "That partner has its own strategies and products to work out, and it wouldn't be proper to comment," he said. "We feel good about the deal because it was a competitive environment."

The EMC-Quantum deal will put most pressure on Data Domain, which has built its backup product around deduplication from the start and is considered the market leader. Data Domain reported a 151% year-on-year increase in its revenues last quarter, hitting $44.9 million (£22.5 million) last quarter following an IPO earlier in the year. Data Domain executives said their company competes successfully against VTLs from EMC and Quantum.

Data Domain CEO Frank Slootman today predicted his company would be able to hold off the EMC-Quantum pairing because its products were designed specifically to dedupe.

"The big difference is, we built this thing from the ground up to do what it does," Slootman said. "Everybody else is coming from different legacy technologies and bolting on a dedupe feature. EMC usually tries to compete against us with Avamar or its disk library. If you look at our growth, they haven't been able to lay a finger on us."

Quantum began selling deduplication appliances in late 2006 with technology originally developed by Rocksoft. Quantum acquired the technology when it bought its tape vendor rival Advanced Digital Information (ADIC) in 2006, just weeks after ADIC acquired Rocksoft.