Storage Station

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Back-to-the-Wall Dell Faces Deadline in 3PAR Love Triangle

Early Sept. 1, Dell -- which simply wants to get better at serving high-end storage customers -- was still revisiting its options. Hewlett-Packard on Aug. 27 played its $2 billion trump card, and 3PAR, the object of this intense love triangle, had "accepted" HP's unsolicited, and overly generous -- according to most insiders -- offer.

Thus Dell, which apparently has a lot more to lose in this bidding war than HP, is left to make the next move. And it will have to happen very soon, perhaps even as this is written from the floor of VMworld 2010. Dell has an agreement that allows it to automatically match any competing offer for 3PAR, so the deal's not over til it's over. But we're getting very close to a resolution.

Some media folks are speculating that Dell will dig deep and put up a sweeter offer today. That could happen, but all HP's going to do is go even deeper. HP's top storage exec, David Donatelli, who learned much of his craft at a real hardball player, EMC, has his eye set on 3PAR, and there's going to be no shaking that notion.

It will be awfully difficult to outspend HP, arguably the world's largest and most successful IT company.

Two billion dollars represents a lot of chatchkis, even for a company like Dell, which has $7.7 billion free and clear in the banks. Certainly both companies realize the value of 3PAR's intellectual property, its strong management team, its consistent execution, and its loyal list of customers. They also realize that 3PAR hasn't been able to take its message -- or its products -- to the next level, because they don't have the sales force and international rep that HP and Dell both have earned over years of work.

However, with all due respect to all three of the aforementioned corporate entities, 3PAR isn't the only storage fish in the sea that offers second-generation-type storage. Isilon, Compellent, Xiotech, Pivot3 and Infortrend are five of at least a dozen established companies that offer high-end utility-type storage for enterprises large and small.

"That may be true, but there are very few other companies available for purchase," Dell storage and cloud guru Praveen Asthana told The Station.

True enough. Those others might not have exactly the type of storage Dell wants to add. Dell's looking for block-level, scale-out brand, and 3PAR has demonstrated it can make it well. Selling it has been another question.

Stay tuned.

Chris Preimesberger

Chris J. Preimesberger

Chris J. Preimesberger is Editor-in-Chief of eWEEK and responsible for all the publication's coverage. In his 13 years and more than 4,000 articles at eWEEK, he has distinguished himself in reporting...