For those that follow IT news closely, the recent bidding war between HP and Dell over storage manufacturer 3PAR has brought to light some interesting concepts. 3PAR is well known in tech circles as a high-end utility storage provider with some very innovative software which allows storage virtualization. The ability to 'thin-provision' storage to servers and 'dynamically optimize' that storage as needed, on-the-fly and without performance degradation is awesome. That alone makes the company's technology worth a few billion dollars. The one thing 3PAR lacked was size and marketing force. When the dust settles, it will have both in the form of a new corporate 'over-lord.' This will drive the company's technology into may more data centers, and the vendor that wins this bidding war will be one step closer to cloud storage dominance.
A recent Wall Street Journal article states that the 3PAR bidding war points to PC's decline and the rise of the cloud. Keep in mind that the valuation of 3PAR prior to the acquisition talks was around $600 million. That estimate was based solely on the hard numbers of the company. That figure does not take into account the future value of the technology stack itself if 3PAR were able to gain a significant market share. This is where HP and Dell come in. Each has an immense footprint in the IT industry and large marketing and sales staffs which can push 3PAR farther than it would have been able to do on its own. Looking at a tiny company that has been able to do what it has on just $600 million of valuation and imagining what it could do with lots more, one can easily see that paying even $2 billion is a cheap price for potential future growth.
So what makes this SAN so compelling to the cloud market? Well, it starts with storage virtualization. By virtualizing your storage, you gain many benefits such as 'thin-provisioning' and 'dynamic data optimization.' Thin-provisioning allows companies to over-commit their SAN without having to buy all of the disks up front. This is a huge cost savings and makes for easy scalability. Dynamic data optimization allows companies to modify how the data sits across the disks in the SAN to gain better performance when needed. This is done on-the-fly, on live production data, with zero performance degradation. These two technologies offer great flexibility and scalability. Flexibility and scalability are key to cloud computing. The technology stack that 3PAR has developed puts the company on even technological footing (some would say better) with NetApp and EMC. It will now be up to HP or Dell to drive the numbers to that same point.