Over at InsideHPC, Rich pointed to an blog by Henry Newman about the changing face of SSD. I’d argue that its not just SSD, but storage in general. But Henry, as usual, nails it.
To a degree, we see them at least investing in the technologies behind the up market devices. At “worst” acquiring them. Because as Henry points out
Very much so. Look at Seagate and WD with their micro NAS appliances. Margins on those low end boxes are probably better with their drives than the drives themselves. Which means that the low end SOHO NAS providers are competing directly with their suppliers.
sTec, before their acquisition, tried something similar. It had the side effect of pissing of its partners pushing its products, and caused those partners to switch providers.
This said, the undifferentiated NAS market is still commodity. The storage component vendors (its not just SSD that they sell, they are looking to sell everything) need to look beyond that into massive scale cold storage, or extreme performance systems. If this trend takes hold, as Henry notes
I agree with Henry. I don’t think M&A; is going to slow down here, if anything, I think the folks with real value will be gobbled up.
Moreover, folks without much value (and Henry starts out with a discussion of one), are in for a much larger world of hurt. Competing with your supplier is a very hard thing. If all your suppliers are competing with you, maybe its time to rethink your market, and find a buyer. And not reject 5 offers. Subsequent offers are likely to be far lower.