Tape Drive Makers Exabyte, Ecrix Unite

With the various makers of DAT technology exiting the market, users of digital audiotape drives will soon have to find storage alternatives.

With the various makers of DAT technology exiting the market, users of digital audiotape drives will soon have to find storage alternatives.

Two Boulder, Colo., companies late last month merged to develop just such technologies. The deal between Exabyte Corp. and Ecrix Corp., a startup in the small-to-midsize tape space, should be complete by the end of the year.

Sony Corp. and Hewlett-Packard Co. over the past year said they will stop manufacturing DDS-4-compatible products, the most widely used DAT technology. Bill Marriner, Exabyte chairman, CEO and president, said such moves create a lot of opportunities for companies seeking to fill the void.

"There is a lot of commonality and yet not much overlap in our respective product offerings," Marriner said of the merger. "[DAT] has reached the end of the road. Theres no road map; theres no future for those users. Its a market in search of a way forward, and we believe Ecrix has it."

Executives with Exabyte and Ecrix said that with the DAT niche evaporating, the combined company will offer replacement products that have DAT benefits in a comparable price and technology structure.

The combined company will also continue using the Exabyte corporate name and the product names of both companies. Ecrix makes the VXA series of tape drives. Exabyte makes the EZ17 and 110 lines of auto-loaders; the 200 and 400 lines of midrange libraries; the 690 and Z series of high-end libraries; and the M2, Mammoth and Eliant line of tape drives.

Anthony Doyle, president of Mondenet Technical Services Inc., an Ottawa Internet service provider and Ecrix user, said he was pleased with the merger but that it will be important that tapes for Ecrix drives continue to be available.

"Its worked well for us," Doyle said of the Ecrix product line. "It probably will be a good merger."

Officials with both companies said there will be layoffs, probably in manufacturing—which will be outsourced later this year—but that the research and development units will not be trimmed.

Exabyte will issue 10 million shares of stock, and company officials announced $9.4 million in new investments from a combination of venture capitalists and private shareholders.

"If they execute their product road map correctly, they have a credible chance," said Robert Amatruda, an analyst with International Data Corp., in Framingham, Mass. "Whats important here is that ... Exabyte has had a lot of investment in automation and libraries, and they could leverage that."

It will also be important for the combined company to address differences in distribution channels and corporate culture, Amatruda said.

Juan Rodriguez, chairman and CEO of Ecrix—and founder of Exabyte—said he is not worried about tape storage despite the debate over the technologys future. "I joined IBM as an engineer in 1963, and within six months, I was hearing that tape would be dead within the following year," said Rodriguez, who will become chief technologist.