UPDATE: This blog has been updated in light of the acquisition of EMC by Dell. Click here to read the latest blog.
NetApp and EMC are two dominant suppliers in the $25B enterprise data storage industry. As such, I am often asked what makes NetApp different from EMC or, why someone might choose to purchase products from either company. In answering, I explain that in the 30-odd years I worked in the data storage industry, I’ve seen five distinct differences emerge between these two companies:
1. EMC thinks mainframe; NetApp thinks open systems (you can’t change your DNA)
EMC was born in 1979 and made a name selling memory boards for large IBM mainframes. In 1990, they introduced the Symmetrix “Integrated Cached Storage Array” for these same mainframes. Over time, as mainframes declined and open systems servers arose, EMC transitioned the Symmetrix into an open system storage array with mainframe-class features. EMC developed a loyal following amongst mainframe IT workers who appreciated the toughness that the Symmetrix brought.
NetApp came along in 1992; about the same time that EMC was in transition to open systems. In contrast to EMC, NetApp started with a clean slate and designed a networked storage array specific to UNIX and Widows file servers. Using a stripped-down design approach, NetApp built an early base of loyal customers that appreciated the simplicity and efficiency of a purpose-built storage array.
2. EMC believes in a different tool for each job, NetApp believes one tool can do many jobs
Recognizing that not everyone required a mainframe-tough storage array, EMC expanded its storage lineup over time by acquiring storage arrays from Data General (1999), Data Domain (2009), and Isilon (2010). As a result, EMC today delivers 4 different storage platforms, each with its own architecture and a feature set suited for particular applications and IT workload environments. This group of 4 architectures consists of 20 distinct products which include Symmetrix VMAX (2 models), Isilon (9 models), Data Domain (4 models), and VNX (5 models). Customers who like lots of choices appreciate the breadth of EMC’s storage products.
Also recognizing that customers have varying needs, NetApp took a different path – a single storage architecture that provides a uniform set of ever-expanding features that can be enabled as needed. The NetApp FAS (Fabric Attached Storage) system is a group of 8 models within a common architecture. These systems share a mutual set of capabilities and communicate using a universal API. FAS systems can be deployed individually or within large virtual system clusters. Customers who prefer simplicity and efficiency appreciate the building-block approach of NetApp’s single storage architecture.
3. EMC believes in expansion via acquisition; NetApp believes in internal innovation
Since 1996, EMC has acquired over 50 companies; or roughly 1 company every 100 days. As such, it is evident that EMC utilizes acquisition as their chief method in advancing product scope and competitiveness. Customers who prefer diverse holding companies consider EMC as an alternative to individual, less solvent, start-ups.
Since 1996, NetApp completed 9 acquisitions. With each acquisition, there was a strong affinity to the core business of enterprise storage arrays. While needed technology was picked up in these acquisitions, the majority of NetApp’s innovation and product competitiveness comes from within. Customers who appreciate technology-focused companies prefer NetApp’s design approach, with a truly unified architecture and a steady flow of industry-first features.
4. Storage arrays are one of many EMC segments, but the only segment of NetApp.
EMC’s revenues are comprised of 4 segments: virtual infrastructure, information security, information intelligence, and information storage. Storage arrays (within the information storage segment) contribute approximately 25% ($10.09B) to EMC’s overall annual revenue. Customers looking beyond storage arrays and seeking security, analytics, and virtualization software consider EMC.
NetApp’s revenues are derived from a single segment: enterprise data storage systems, with storage arrays contributing nearly 70% ($4.21B) of overall annual revenue. Customers looking for a company with a singular focus on enterprise storage innovation choose NetApp.
5. Service revenue plays a greater part in EMC’s strategy than NetApp’s.
EMC’s information storage service revenue ($4.2B) represents more than 45% of overall product sales. This may be attributed to EMC’s mainframe background, where onsite engineers were the norm. According to EMC, “a growing demand for professional services also contributed to the increase in services revenues.” Customers who require close personal contact with their vendor’s engineers consider EMC.
NetApp’s service revenue ($1.2B) represents less that 30% of overall product sales. As summarized in this article, “Unlike larger competitors such as EMC, IBM and HP, NetApp has never really treated services as a distinct business within the company, but rather as a way to meet customer needs and support the product business.” NetApp has built a strong following of customers who prefer automated management tools such as AutoSupport and Workflow Automation (WFA) in lieu of expensive onsite support.
Summary – “Working with NetApp just feels different”
This comment comes up so often in customer briefings I feel compelled to mention it. Some people say the personalities of the two companies just reflect typical east coast (EMC) vs. west coast (NetApp) attitudes, but I think the analysis goes much deeper. When people make a large purchase, they feel better when they believe that their vendor is completely committed to their success. This is not to say that EMC is uncommitted to the success of their customers, but that NetApp seems better at developing a tight bond between the customer and vendor, with the highest quality and competency rankings amongst all enterprise storage vendors.