EMC backs Iomega up into Lenovo partnership

The first fruits of a global technology partnership between storage giant EMC and server upstart Lenovo have ripened as the two companies have launched LenovoEMC Limited, which pairs EMC's Iomega entry-level network-attached storage (NAS) arrays with Lenovo's ThinkServer product lines.

EMC acquired Iomega in early 2008 to expand into the low-end NAS business as its partnership with server maker (and at the time, entry disk array maker) Dell started to go up on the rocks. The partnership between Lenovo and EMC seeks, among other things, to give EMC a source for low-cost engineered servers upon which it can base its various storage arrays.

Access to the burgeoning Chinese IT market is also one of the goals that EMC has with the partnership, about which both companies said very little last summer.

There was talk of taking the Iomega assets and putting them into a new joint venture that would tackle the SMB market with entry NAS products, and this is precisely what has happened.

Under the terms of the partnership, Lenovo is setting up a server development center in North Carolina, called the Enterprise Product Group, to make custom server designs that will be used by Lenovo, EMC, and other OEM partners – and now, presumably, the LenovoEMC joint venture that is making entry NAS devices. Lenovo shipped the first ThinkServer to come out of the Enterprise Product Group, the ThinkServer TD330, back in November.

The partnership between EMC and Lenovo also called for Lenovo to kick in for a majority stake in a NAS joint venture, which would make use of EMC's Iomega NAS software and Lenovo's servers to attack the small and medium business market. Basically, EMC is offloading manufacturing of Iomega NAS arrays to Lenovo in the kind of tightly coupled partnership that it once had with Dell.

EMC could have just hired its own server design teams and gone to ODM manufacturers in China to make its own server and storage boxes, but that would not give EMC an automagic entry into the Chinese market.

A joint venture with Lenovo does that, and will no doubt give Iomega a much larger footprint in China than EMC could have got on its own, while at the same time helping EMC lower manufacturing costs and increase sales in other parts of the globe.

Making nice with Lenovo also gives EMC a partner for servers used in Hadoop and parallel database clusters, which are going to end up in the Pivotal Initiative business unit that EMC chief strategic officer Paul Maritz said in December that EMC would be launching in early 2013.

Pivotal Initiative also includes the Cloud Foundry platform cloud software that was formerly under control of server virtualization juggernaut and EMC minion VMware, as well as Pivotal Labs, the coders-for-hire outfit that EMC bought a year ago.

Eric Arcese, who was formerly director of sales strategy for EMC in Latin America, has been named president and general manager of LenovoEMC, even though Lenovo has the majority stake. The joint venture has operations in Morrisville, North Carolina, which is to the south of the Research Triangle Park high-tech area of the state, but has its principle offices in Massachusetts and Utah, according to this blog post from the formerly independent Iomega subsidiary .

At the moment, the venture is pairing up the various Iomega desktop, tower, and rack NAS boxes bearing the Iomega brand to be sold alongside ThinkServers and their workstation companions, the ThinkStations. But over time we can expect custom NAS machines bearing the Lenovo|EMC brand, much as Dell-manufactured and EMC-designed entry arrays used to have the Dell|EMC brand slapped on them.

EMC is also working with Lenovo to peddle its other storage arrays in China through the partnership deal, and the Iomega post said that these Lenovo|EMC storage products would be launched in China this month.

It is interesting to note that both EMC and Lenovo said in the launch statement for LenovoEMC that the joint venture "is not considered material" to either company's annual earnings. That, of course, is one of the things EMC and Lenovo want to fix. ®