EMC World 2011: How far will EMC move into the datacentre?

The massive acquisition budget and move into server flash has got tongues wagging about EMC’s direction.

Jennifer Scott

COMMENT: This week has seen a plethora of news come from the storage machine that is EMC. However, storage is just not enough to describe the firm any more.

With its moves into management software, security and its clever acquisition of VMware in 2004, making it the leader in virtualisation, it has a far wider remit than just enterprise data and how and where it is stored.

This week, it unveiled Project Lightning, providing flash-based server cache to the industry.

As soon as the project was revealed, the gossip started. Was EMC gearing up for a move into the server market?

Executives offered varying levels of denial but nobody gave a straight no. In fact, when I spoke to the president of EMC in Northern Europe, he merely listed the amount of cash the company had to invest into researching and acquiring new technologies.

Admittedly, the focus seems to be on adjacent markets rather than a sudden leap into servers, but I was told by several EMC employees the focus was now the datacentre, not one element or even several, the whole datacentre.

EMC is a very successful company and its current ploughing of funds into cloud computing and virtualisation is likely to see it well. It is a market leader in several areas too.

Although it clearly has the cash and a lot of technical skill to broaden its market, I am concerned it may leave behind what it excels at.

Look at Cisco. A leading light in networking for so many years. However, it decided to go into servers, tablets, even portable cameras, and as it continued to spread itself thin, it lost its dominant spot, leaving rivals to pick up the pieces.

Companies who spend so long in one market don't always know the best way to break into another, leaving their real expertise to shrivel in the dark with no attention.

EMC has a lot more practice at moving gently into other markets and making quite a lot of cash in the process. Maybe it wouldn't be such a bad idea?

However, it would have to be wary of upsetting its huge list of partners including Cisco.

What, therefore, will EMC be spending its $3 billion of R&D and acquisition money on this year? The only thing we know for sure is it will add to its datacentre portfolio.

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