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BLAM! IBM drags its NetApp OEM deal horse outside, gunshot heard

So long, and thanks for all the fish

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IBM has formally sundered its OEM relationship with NetApp, as we earlier suggested it would.

Spokesperson Michael Zimmerman provided a statement, saying:

Cloud and the explosion of data associated with social and mobile are increasing the demand for flexible storage solutions. This is driving a shift towards software delivery models and towards storage repositories that enable multiple use cases such as object, big data and file. With IBM Smarter Storage solutions, IBM’s objective is to transform the economics of data while addressing this shift.

We see this as clearly signalling a move towards a more software-defined storage strategy and a cloud storage delivery model. IBM says it wants storage repositories that provide “object, big data and file.” The NetApp FAS arrays provide file but not object or big data services, in IBM's implied view.

The statement continues:

With leadership in software defined storage, data virtualisation, flash and cloud deployment at scale that enables clients to support both traditional and emerging workloads, IBM has developed an organic range of solutions that deliver cost effective, scalable data storage models for improved data economics.

We’re seeing the SVC, Storwize and FlashSystem products here, noting that IBM acquired both Storwize and Texas Memory Systems, whose technology provides the basis for IBM’s FlashSystem array products.

With this in mind, IBM is focusing on and investing in those solutions that help IBM deliver best-in-industry solutions to its clients as they address these dynamic shifts, and is stopping development on the IBM N series product line. IBM’s N series Release 30, announced on February 18, will therefore be the last IBM enhancement to the N series product line.

IBM and NetApp started their OEM relationship in November 2006, about eight years ago, and Big Blue also OEMs the E-Series, with NetApp acquiring that relationship when it bought Engenio in March 2011.

IBM's statement went on to detail how the split would take place.

While the planned formal withdrawal date for new N series systems will be May 27, the last order date will be 90 days later, with miscellaneous equipment upgrades planned to be available for 12 months. Support of current N series product and configurations will continue through 2018.

IBM will continue to OEM a portion of the NetApp's E series family, DCS3700 and the DCS3860, which are dense storage drawers that integrate with IBM System x, BladeCenter and Power Systems, for high performance computing solutions. Additionally, IBM maintains the ability to source NetApp FAS equipment via the long standing reseller agreement with IBM Global Technology Services. We will continue to provide existing N series customers with the same level and quality of support they've grown accustomed to.

That’s it; gone, done and dusted apart from the Engenio storage drawers and odd FAS resale deal. The writing has been on the wall for a while but when the end came IBM moved swiftly and NetApp was surprised. NetApp CEO Tom Georgens discussed this in the recent results earnings call, talking of “unanticipated headwinds in our OEM business”.

Optimists will say the split frees NetApp from a relationship that was stuttering anyway. Pessimists will say that NetApp increasingly, and dangerously, stands alone. From now on the IBM-NetApp OEM relationship is sleeping with the fishes. The storage Vulture thinks the optimists have it. ®

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