Company to sell IntelliFlash unit to DDN and put ActiveScale on block
Western Digital is getting out of the storage systems business, selling its IntelliFlash storage array unit and putting its ActiveScale archival storage unit up for sale.
The Lowdown: The company is selling the IntelliFlash business to DataDirect Networks (DDN), a storage systems provider that has expanded into such areas as cloud data management and artificial intelligence (AI). In addition, the two companies are expanding an existing relationship with a multi-year strategic sourcing agreement under which DDN will increase the number of Western Digital HDD and SSD storage devices it buys.
The Details: Western Digital did not release financial details of the IntelliFlash deal, which is part of a larger effort by the company to get out of the storage systems market and focus on its data center systems business, which includes the OpenFlex composable infrastructure solution and its fabric-attached storage technologies. The deal is expected to close by the end of the year.
The company introduced OpenFlex in 2018, unveiling a composable infrastructure that leverages NVMe-over Fabric (NVMe-oF) technology to improve the performance of servers and storage systems. Composable infrastructures are designed in part to disaggregate storage from compute and create flexible pools of resources that can better address the needs of applications.
Western Digital makes the bulk of its money by selling hard disk drives (HDDs) and solid-state drives (SSDs) to storage vendors and consumers. Its expansion into storage systems has put it at odds with some of the same OEMs that it sells drives to.
The Impact: The enterprise data storage market is a fast-growing and rapidly changing one that includes everything from all-flash and hybrid systems to composable and hyperconverged infrastructures and that is being influenced by the cloud, the trend toward software-defined environments, and NVMe and other technologies. According to Zion Market Research, the next-generation data market, which was $50.4 billion in 2018, will reach almost $115 billion by 2025.
Background: The company had ramped up its storage systems business over the past few years, including adding the IntelliFlash unit two years ago when it bought Tegile, part of a multi-year buying spree that also included the acquisitions of flash vendor SanDisk and HDD company Hitachi Global Storage Technologies. As late as June, Western Digital had bolstered the IntelliFlash systems by adding NVMe and SAS capabilities and enhancing its software.
The Buzz: “As we look to the future, scaling and accelerating growth opportunities for IntelliFlash and ActiveScale will require additional management focus and investment to ensure long-term success,” said Mike Cordano, president and COO of Western Digital. “By refocusing our data center systems resources on our storage platforms business, we’re confident that the Western Digital portfolio will be better positioned to capture significant opportunities ahead and drive long-term value creation.”
“DDN has deep technical expertise and capabilities in high performance and at scale data environments and is well-positioned to build on and accelerate the success of the business,” said Phil Bullinger, senior vice president and general manager of DNN’s data center systems business. “Importantly, both Western Digital and DDN are aligned in our commitment to executing a smooth transition for all stakeholders. Western Digital will remain one of the largest consumers of IntelliFlash products, and customers will continue to receive best-in-class service and support.”