M&A: Seagate snarfs up DotHill

The Register reports this morning, that Seagate has acquired DotHill. DotHill makes arrays and their kit is resold and rebadged by many.

In general the array market (high end) is in a decline, and doesn’t show signs of turning around (ever). The low and mid market, including some of the cloud bits is growing. I am not sure about the OCP stuff, but the low end bits are where we are seeing 4, 8, and 12 drive arrays show up as completely commoditized gear.

This play makes sense from a vertical integration view, as Seagate had already acquired Xyratex, and invested more into selling the kit. It also places significant pressure on all the other storage makers to do similar things.

I do know of at least one building some interesting kit. The others, not so sure of.

I did have one OEM tell us that they didn’t want to compete with their (high end) customers in a different context. One of the rules of business is, if you don’t cannibalize your own products and offerings, your competitors will happily do this for you. I don’t expect that point of view (that they don’t want to compete with the higher end customers) to last very long.

This also suggests that these folks will likely be getting into the same space as us, hardware/software stacks for hyperconvergence.

This isn’t the last of it, I expect significantly more M&A soon.

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