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EMC drops $165M on data deduplication firm Avamar

EMC announced plans to acquire data deduplication backup vendor Avamar, another acquisition within a week of CEO Joe Tucci promising a slowdown in the company's buying spree.

EMC Corp. announced at the Storage Networking World (SNW) show in Florida today that it will purchase data deduplication backup company Avamar Technologies Inc. for $165 million -- yet another acquisition and within days of CEO Joe Tucci promising a slowdown in the company's buying spree.

Avamar makes a disk-based backup product called the Axiom. It is best known for its hash-based commonality factoring software that identifies similar data from multiple clients over many backups and only stores one copy, making more efficient use of storage space and reducing backup time. The hash is the result of applying an algorithm to some data to derive a unique number. It's extremely unlikely that any two files would produce the same hash result. Users said it takes approximately three weeks of running backups before true returns can be seen. Avamar has approximately 400 customers, according to EMC.

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"This is my favorite acquisition of October," joked Mark Lewis, executive vice president and chief development officer at EMC, during a dinner with press and analysts Tuesday night. EMC plans to add Avamar's technology to its backup products, namely Legato Networker, and its Clariion Disk Library virtual tape product, but no timeline was given for the integration. Lewis' comment touched on a sensitive topic among industry analysts. EMC users, who have watched the company spend billions of dollars in the past few years, are still waiting for it to integrate the pieces in a meaningful way. Infoscape, EMC's new data classification tool that pulls together components from its acquisitions of Legato, Documentum and Smarts, was the first significant step in this direction taken a month ago.

"We can see in our research [talking to end users] that there's an impact, because people are concerned that they've bought too much. EMC will have to watch very carefully how they set expectations about all these acquisitions [for users]," said Robert L. Stevenson, managing director of TheInfoPro's storage research. On the other hand, he said "If these acquisitions are strengthening their product roadmap, some users could actually feel better about investing in EMC, knowing how much they're putting into development toward the future."

Phil Goodwin, president and a founder of Diogenes Analytical Laboratories Inc., noted that data deduplication technology goes against EMC's hardware business once and for all --as it means less disk.

"It's creative destruction in a sense -- they eventually will have to destroy some of their own business in a way, especially if they combine this with Symmetrix or Clariion. But companies that can do that in the long run will come out on top."

Stevenson added that the race is now on between Network Appliance Inc. (NetApp) and EMC to integrate deduplication into their core products. Both have the technology, "but if they [EMC] can get it integrated with Celerra, that puts pressure on NetApp," he said. Another company making waves in the deduplication field is Data Domain Inc., which recently launched its data center deduplication storage array, dubbed the DDX.

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