M&A: HGST acquires Amplidata

This is closer to home. Amplidata is an erasure coded cold storage system atop “cheap” hardware. HGST makes, of course, storage devices.

This continues a trend in vertical integration of folks with systems experience, and folks who make the things that go into these systems. If you control more of the stack, you can create more value to your bottom line … up to a point.

The flip side to this is if you start competing with your customers. This is a good way to kill a channel, and drive customers to your competitors.

The only major tier 1 vendor I don’t see doing this now is Toshiba. HGST/WD, Seagate, Sandisk are all building vertically, with integrated units of one sort or the other.

All these systems will compete with some segment of their customer base though. Finding and striking that balance is important. Where you can add value (cold storage, big data, massive performance storage) is where they could play nicely.

I do expect this to be fairly disruptive to a number of vendors in the space. Should be quite interesting.

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