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

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 …

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Anonymous Coward

What is there to free ?

"frees NetApp from a relationship"

How is this a good thing - was it an onerous relationship or one where IBM sold NetApp products and brought NetApp additional revenue? What was the downside that freeing it up makes NetApp better off ?

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Re: What is there to free ?

My own experience (in more than one country) the majority of N-Series sales (i.e. IBM) were generated when NetApp was already in a favorable position in an IBM site.

Rarely did IBM like leading with N-series from the start.

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Re: What is there to free ?

"How is this a good thing"

Every hound has to be weaned from the teat. I know of a local company or two that never came to its full glory because its main source of income was from government contracts. A steady income is an artificial limitation for many. How do you convince colleagues to take a painful course of action when things are more than comfortable for a shot to get even more of the same? The most effective way to wean a pup is for the bitch to stand up and walk away.

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Bronze badge

Re: What is there to free ?

What I saw specifically was IBM shops looking for a solution that IBM couldn't provide themselves - the N-series stuff is way ahead of the DS-series stuff on features and functionality (and was often put in front of existing DS storage to extend ONTAP features to the legacy arrays). IBM would pitch N-series to those customers to keep them in the IBM camp.

The downside for IBM is that IBM would often bring the first FAS into an environment, but once the customer saw the number of things they were missing as part of being an IBM customer rather than a NetApp customer, NetApp would sell the subsequent arrays (IBM didn't certify many versions of ONTAP and was often 6 months behind on software updates, as well products which became free for NetApp users were a pain to get a hold of for IBM customers, plus the My AutoSupport site was not available to IBM customers - big let-down, and further, the support was terrible off-hours).

I could see the deal being lucrative for IBM in the beginning, being able to offer a scalable, high-performance multi-protocol storage array without losing customers to competitors, but once those customers started turning to NetApp for future purchases the writing was on the wall for the OEM deal (NetApp specifically supported SnapMirror from N-series to FAS for data migration and provided the licensing free of charge for that purpose).

I don't know how the Unified offering works out for Storwize customers but I've heard mostly good things on the block side (especially for FCP, with a few odd comments about poor iSCSI performance under VMware but that was from a P4000 pusher).

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More than it is one time trouble for NetApp, it was and will be troubling IBM due to conflicting products. In fact this conflict and lost margins will be huge compared that 2% impact to NetApp. Perhaps this OEM made sense at the begining 8-10 years back.

Looks like IBM is going to focus on its own or it will get out of storage completely given the its trend on getting rid of hardware.

If I what I heard is true, ironically Softlayer (now owned by OBM) uses NetApp storage. Even if N series goes away, NetApp seems to be in background via IBM cloud.

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Anonymous Coward

N Series was only for when the customer didn't have a master purchase agreement (or whatever) with NTAP but did with IBM. It was just easier to slap an IBM bezel on the front, change the icons in the GUI and ship the tin and software. As NTAP got larger and ever more into larger enterprises the need for the OEM relationship became ever more irrelevant. The big banks now have FAS up the wazoo - File AND Block. Like the article says, FAS is resold by IBM as well. All that's going to happen now is that the branded sales will take the place of former OEM sales. Market share won't drop. Petabytes shipped won't drop. System sales won't drop. Far from it.

Customers hated IBM support, and, yes, understanding that all support sucks at some point in the process, preferred NTAP support.

Life is good for NTAP if you look past the usual haters.

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Anonymous Coward

El Reg

"Market share won't drop. Petabytes shipped won't drop. System sales won't drop. Far from it."

Sure, the stock price has not crashed, but Apple, Google and Amazon aren't buying NetAPP or IBM or EMC. With the move to the cloud I can see growth tailing off and sales declining after that.

NetApp are vulnerable. EMC have Documentum and VM Ware. IBM have a host of other revenue streams. NetApp are pure play - they could easily be in deep trouble if revenue dips significantly as companies increasingly move to the large cloud providers (mostly AWS at the moment).

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