StorageTek shareholders voted for Sun's US$4.1 billion takeover Tuesday with over 99 percent of shareholder votes in favor. Just 0.33 percent of votes were against the Sun deal with 0.46 percent abstentions. Shareholders will be paid US$37 cash per StorageTek share they hold.
The takeover is the high point of Sun's desire to revitalise the storage side of its business and to expand the availability for its servers and software. Sun customers can expect to be called on by StorageTek sales reps, now working for Sun's new Data Management Group, but selling STK-badged kit. On offer will be tape libraries of various sizes, nearline disk-array storage, disk-to-disk backup products, and a comprehensive information lifecycle management (ILM) set of products and roadmap. The range of products will be topped off with Sun's StorageTek (ex-StorEdge brand) 9990 enterprise disk array, OEM'd from Hitachi Data Systems.
There will also be name changes. Sun uses numbers; StorageTek uses names. Given the strength of StorageTek as a brand we might expect StorageTek's sub-branding style to prevail.
There will probably be a rationalisation of disk products. Sun staffer Kathleen Holmgren will most likely run the disk unit. She formed the original Storage Product Group at Sun in 1995 -- the one that has seen EMC make such in-roads into Sun's customers. She now has three OEM suppliers: HDS; Engenio; and Dot Hill, and overlapping mid-range arrays. StorageTek doesn't do multi-vendor disk virtualisation. Sun does, both at the high end with the 9990, and at the mid-range with the 6920. Expect the Sun approach to prevail here with STK's arrays getting Sun controller technology grafted on to them. Expect also mid-range array rationalisation.
This also means that STK's ILM products will have to embrace multi-vendor tiered storage. StorageTek's VSM, its mainframe-based virtual tape system, will probably receive additional development effort as STK is falling behind rivals, notably ADIC, in bringing such technology to the open systems market.
STK engineers will have Sun's coming Niagara technology revealed to them. It may open up tremendous opportunities in the high-end library space. There is also the Honeycomb technology to assimilate.
Undoubtedly a stronger and broader storage offering will result. Whether it will drive EMC out of Sun's customer base on the one hand, and/or become a storage product powerhouse rivalling EMC on the other, remains to be seen. As corporate strategists might say: the three most important things about mergers and takeovers are execution, execution and execution. And if they don't work then the execution can be at the CEO level. Just ask Carly Fiorina.