EMC Buys iWave To Expand Cloud Computing Infrastructure & Support Pivotal Initiative

by Trefis Team
Rate   |   votes   |   Share

Quick Take

  • The IT cloud services market was worth $35 billion in 2012 and is set to grow to $73 billion by 2015
  • The hosted web services market is part of the IT cloud services market and was worth nearly $2 billion in 2012. Amazon dominates this market with nearly 90% market share, followed by Google and Microsoft
  • Last month EMC and VMware announced a collaboration called Pivotal Initiative, which combines specific resources from each organization to address the cloud services market
  • The Pivotal Initiative will consist of nearly 1,400 employees from both organizations and will focus on Big Data and Cloud Application platforms
  • It will be led by Paul Maritz, Chief Strategy Officer of EMC, and the company will announce its official structure in Q1 2013
  • iWave’s flagship product is an automation and provisioning tool and this will add to EMC’s own cloud infrastructure provisioning service

EMC (NYSE:EMC) bought storage and cloud automation company iWave for an undisclosed amount on January 8. [1] iWave Software provides storage and cloud automation solutions to enterprises with the aim to lower IT operating costs and improve agility and service levels. The iWave Automator product suite helps configure and automate tasks associated with provisioning and management of storage infrastructures, data centers and cloud environments, and its employees will be absorbed into EMC’s Advanced Storage Division (ASD). The automation software is also likely to help EMC’s Pivotal Initiative. The automation feature is particularly useful in storage provisioning systems as it can provide scale on demand, which is the biggest advantage of a service like Amazon’s AWS, apart from cost.

See our full analysis on EMC

Acquisition Will Help EMC Customers With A Comprehensive Storage Product

iWave enjoys a top position in the storage and cloud automation software market primarily due to its tie-up with EMC. The company makes solutions for process automation in private storage clouds and data center environments. It has two popular products: the iWave Automator and iWave Transport Manager.

The iWave Automator is an IT administrative product that helps users with server provisioning and enterprise sprawl, private cloud administration, storage provisioning and reclamation, event response and fault remediation, IT service management integration, and resource allocation. [2] The iWave Transport Manager is an information release management tool, which can enforce Sarbanes-Oxley compliance in the SAP environment.

The acquisition has two advantages for EMC:

1) The company can add automation to its storage software, making it easier for the customers to use EMC products and discouraging them from going to third party vendors to add the automation feature on top of EMC’s software. This will reduce cost and time for implementation and provide EMC an edge over competitors like NetApp.

2) The Pivotal Initiative, which is EMC’s answer to Amazon’s AWS, can benefit from the know-how gained from the iWave acquisition. The key advantages of cloud hosting are automatic scaling and scaling on demand. The iWave acquisition should benefit EMC on these fronts as well.

We currently have a $52 Trefis Price Estimate for EMC, which is significantly above its market price.

Understand How a Company’s Products Impact its Stock Price at Trefis

  1. EMC Buys iWave, www.theregister.co.uk, 8 Jan 2013 []
  2. iWave Storage Automator, www.iwavesoftware.com []
Rate   |   votes   |   Share


Name (Required)
Email (Required, but never displayed)
Be the first to comment!