NetApp rumors

Recently the Executives at NetApp have been extemely quiet, which may have contributed to new rumors of a takover possibility for NetApp. One of our customers sent me this link and asked what I knew.

Could Takeover Rumors On NetApp (NTAP) Have Some Meat?

Michelle Leder’s footnoted.org highlighted recently amended change in control agreements for NetApp, Inc. (NASDAQ: NTAP) CEO Daniel Warmenhoven and other unnamed executives. The changes come on the back of rumors the company could be the target of a takeover bid.
Michelle said it is possible the change was simply routine, but she is obviously noting this because amendments to change in control agreements sometime precede takeovers.


This was the first time I had heard of this rumor and all I can tell our customers and interested parties about this is that Zerowait will continue to provide the high availability service and support they expect from us for legacy NetApp products whether NetApp is acquired or not.

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Sun is going on a FISHing trip

According to the New York Times, Sun is getting ready to unleash new Storage products into the Enterprise space. Although NetApp does not think they will be any threat, I have spoken with many customers who are thrilled with the price point and performance of their SUN Thumpers.

According to the Article.

With these difficult lessons behind it, Sun thinks it now has a chance to disrupt a different part of the hardware sector and make life tough on rivals. In November, Sun plans to release new storage hardware and software that takes aim at a part of the storage market dominated by NetApp and EMC. Playing off the same trends that shook its server business — less expensive hardware and software — Sun is looking to undercut the competition and sink their margins.

But NetApp does not see the new products as any problem.

As for NetApp, the main target for Sun, the company sees customers continuing to pay a premium for software that delivers more sophisticated functions than what Sun is discussing. “The larger companies out there will not go with the Sun type of solution,” said Patrick Rogers, a vice president at NetApp.

One of the commenters on the article has this to say....

We moved entirely away from NetApp product, and are running large storage farms on Sun’s Thumper products. We are seeing dramatic performance increases, and significant price reduction.
I am curious why NetApp doesn’t see this as a threat, it surely looks to be exactly that.— Banking Customer

Zerowait has seen our business grow over the last few years because NetApp customers are tired of the high prices for support and maintenance of their equipment. I would think that customers that are used to Sun in their server farms would be willing to take a chance on these new products, especially is they are less expensive than NetApp. Competition works and customers will benefit by lower prices.

With low prices as bait, Sun may have a great fishing trip.

In November, Sun is set to show off new storage gear that has been part of a project code-named FISHworks (FISH stands for Fully Integrated Software and Hardware).

I’ll be watching, to see what they catch.

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Compliance issues

Most of the time when issues of compliance come up within our industry it is about meeting standards for data integrity and security. But because of the recent spikes in energy costs for running and cooling data centers fire code and electrical code compliance issues are starting to creep into conversations with network and storage managers. Today I saw the first article in the press that detailed some of the issues managers face. It is worth reading the whole article.

“The hot aisle is just too hot,” Sacco said. “If you’re going to exceed 110 degrees, you could actually exceed the [National Electric Code] standards.”

Forgetting about the fire code issues, Menuet added that you have to think of your employees.

“It will be over 100 degrees in the hot aisle,” he said. “It certainly isn’t comfortable for technicians that have to get in there and work on the equipment.”

Using vinyl curtains for separation
Using vinyl sheeting, much like what you’d find in a meat locker, is one method that data centers have used to contain their hot aisles. Storage vendor NetApp uses them and says the curtains alone save it 1 million kWh of energy per year. Yahoo uses them in one of its data centers as well.

But there are fire suppression issues with this method as well. If you have plastic sheets over your racks and don’t have sprinklers in the contained area, how can a potential fire be squelched? Most companies that manufacture this sheeting say it melts at 130 degrees, thus eliminating the aisle containment and allowing the sprinklers to work from there. But what if for some reason the curtains malfunction?

“The curtain attaches to the ceiling with heat-sensitive fusable links,” Menuet says. “If there’s a fire, the heat melts the links and the curtain falls. But if I was the fire marshal, I’d be concerned about a curtain hanging from some fusable links. Most places would have trouble with that. If I were proceeding with good hot-aisle/cold-aisle containment, I would design a fire system around it and put enough heads in the hot aisle and enough in the cold aisle.”

Never mind the aesthetic ramifications. Menuet said he was working on a project in Minnesota, where discussion included using freezer curtains to contain the hot aisle, “but it didn’t show well.” In other words, company executives might not like the fact that their data center looks like the back of a butcher shop.

Inform the local fire inspector
Sacco added that one of the most important things is being in line with local fire authorities, because if they conduct an inspection, see something they weren’t notified about and don’t like it, they could shut you down.

“Many people deploy these systems in ignorance of the law,” he said. “Many people do it and manufacturers are manufacturing the pieces. But the local inspector is the final authority. If the local inspector doesn’t realize what’s going on, the whole job might not be compliant.”

This last statement is worth remembering when you are tinkering within your data center.

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customer service

Last week we had a customer who called with a problem. While working with the client we decided that the best way to solve the problem was to go on site. So we told the customer we would fly up to see him and should be there in a few hours. I filed a flight plan and one of our engineers and I went over to my plane and flew up to the Boston area to solve the customer’s problem. Gaining new customers is hard, and at Zerowait we like to try to keep our customers happy. This customer is now convinced that we really do care about customer service.

Today I had an experience that shows me that not all companies care about their customers. AT&T is our cell phone provider and we have a corporate account, which means that the account executive wants the last 4 digits of an FEIN number not a Social security number to verify the account. But the customer service reps I spoke to kept asking for my phone number, name and social security number. I tried to explain that my social security number and our corporate FEIN number are not the same and I didn’t know the FEIN- but two different reps could not understand that. Finally I got a rep that would agree to let me speak to a supervisor. I explained the situation to Mike the supervisor and he laughed and agreed that good help is hard to find.

The situation reminds me of when I go up to the airline counter and they ask me if the bag has been in my possession since I packed it. Well the reality is that the bag has been in a shuttle bus and sometimes at a concierge desk and many other places. So when asked what are we to say? If I say that the bags have been in my possession that is not completely true. Should I tell them the truth that the shuttle bus driver put the bag in the back of the bus, and the concierge put it in a closet while I was out visiting clients after I left the hotel room but before I had to get the bus to the airport? In a completely interrelated world of commerce, business and our personal lives we are being forced to tell companies half truths to fulfill the needs of their databases, before we get the customer service we deserve. This is backwards. We should be able to create systems that verify who we are when calling with two pieces of information. AT&T had my name and phone number. Their DB keeps a FEIN number instead of a SSN; that is not my fault.

Customer service is a primary responsibility of every company – there is competition for every company’s service. When AT&T technicians call Zerowait for help with their filers should we ask them for their FEIN number? Will they know it?

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New England bound

I am going up to New England to visit with some of our customers for the next few days. The New England area has been a good area for our business for many years. At one time in 2000 our largest NetApp customer was based in Boston. They used to buy 760’s from us with 1TB of storage which filled a cabinet with FC9 shelves filled with 18GB drives. It is amazing how much has changed since then, now we are offering DS14 Shelves with 1 TB for $1000.00.

Over the next few weeks we will be traversing the country and going overseas also. All leading up to our customer conference in Reno in September. We only have a few openings left for this event, so if you want to join us , drop us a line.

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Is IBM’s XIV product aimed at NetApp?

According to an article in Computerworld the product does not match features with EMC, but what if IBM is testing the waters with XIV to see if it can slowly turn their N Series customers into XIV customers. IBM’s OEM version (N-series) of the NetApp Filers can’t be as profitable for them as selling their own products. And know that they understand how to sell into the Filer market space it would make sense for them to introduce their own product offering.

You can read IBM’s product announcement here

“The IBM XIV Storage System (2810-A14) provides the hardware platform required for the IBM XIV Storage System Software. The combination of hardware and software enables a revolutionary grid-based architecture designed to provide an exceptionally easy to use, high performance, scalable, reliable enterprise disk system for UNIX, Linux, Windows, and other supported distributed open server platforms. It can provide a platform to address the need for reducing complexity while keeping pace with midrange to high-end disk capacity demands. This system is a great addition to the IBM disk storage family, core products in the IBM Information Infrastructure. It is a good fit for clients who want to be able to grow capacity without managing multiple tiers of storage to increase performance and reduce cost. These users also may want to improve their backup capabilities, as well as reduce the task load on storage administrators. The XIV system is especially well suited as a consolidated utility storage for fast growing, dynamic mixed, and emerging workloads.
Statement of general direction

IBM intends to provide best practice configuration guidance, change management, asset awareness, capacity utilization, performance trending, and operational reporting capabilities via IBM TotalStorage® Productivity Center software support for the IBM XIV Storage System.

In addition, IBM intends to provide single sign-on capabilities for many IBM devices, including the IBM XIV Storage System and storage software applications that enable the administrator to use a single set of secure credentials to authenticate across all products via a single centralized point-of-control.

IBM plans, during the second half of 2008, to add support for XIV as a disk system managed by IBM System Storagetm SAN Volume Controller. This additional support will provide connectivity for XIV systems to the very broad range of operating system environments supported by SVC.

This statement of direction is based on Tivoli’s current development plans and is subject to change without prior notice.

All statements regarding IBM’s plans, directions, and intent are subject to change or withdrawal without notice. Any reliance on these statements of general direction is at the relying party’s sole risk and will not create liability or obligation for IBM.”

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NetApp quarterly profit rises, outlook disappoints

NetApp has hit a rough spot. They are increasing the size of their sales force but sales are not growing that fast yet and they risk alienating their reseller channel:

“They feel like if they can put more people on the street, they can gain a lot of market share,” said Pacific Growth Equities analyst Kaushik Roy. “The problem is, they’re not competing with the little Chinese vendors from Taiwan. They’re competing with the big guys… To gain market share from EMC (EMC.N: Quote, Profile, Research, Stock Buzz) and HP (HPQ.N: Quote, Profile, Research, Stock Buzz), it’s a struggle.”

Perhaps this explains why their reseller channel management is in disarray?

“In a surprise move, popular channel sales leader Leonard Iventosch suddenly left NetApp, where he’d worked for more than eight years. Company officials say it’s business as usual for partners while they search for a replacement.”

It may be getting hard to provide NetApp resellers incentives while they are simultaneously growing their internal sales force to put ‘feet on the street’.

For customers buying new equipment from NetApp this should mean that there is opportunities for negotiation between the competing sales channels. Why not get competing sales quotes from the NetApp, IBM and your reseller channel, which now includes CDW. If you are buying new equipment why not see how well competition works?

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Support costs poll

Are you considering Zerowait for NetApp filer or NetCache support?

Are you happy with your NetApp support costs?
Yes – NetApp support costs are affordable.
No – NetApp support costs too much.
I am considering Zerowait for our NetApp support
  
pollcode.com free polls
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Another trip to Dallas

I have been visiting customers for the last couple of days in the Dallas area, and last night 8 members of our customer family met for dinner at Del Friscos. We had a great time talking tech and trading ideas. It is always fun when we can get together with a group of customers so that they can meet each other and discuss their common network and storage problems. Last night we really had a great time.

As I write this, I am at DFW waiting for a flight back home. You can certainly learn a lot about bad customer service techniques at an airport. It seems that all the employees are unhappy and the customers are unhappy. The TSA lines and techniques are a fiasco. It does not look like there are any quick solutions to all the problems in the airline business, but it certainly makes me glad that I am a pilot and can fly to many places on my own without the hassles of airline travel. A few weeks ago I flew to Charlotte, Atlanta and St. Petersburg to visit clients. At every airport FBO the folks were happy to help arrange cars and hotel rooms. The difference is night and day in attitudes and customer service. Smaller companies just seem to give better service in the aviation busness, perhaps it is because they are service oriented?

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The Starbucks Effect

A few months ago people we saying that Starbucks would not suffer in tough economic times because folks will always have enough money for a luxury item like Coffee. But now we see that Starbucks is having a rough time of it because their customers are cutting back, causing a loss for the company.

In a conference call with analysts, Mr. Schultz said customers remain loyal, but “they’re visiting us less frequently as a result of economic pressures.” He said Starbucks will promote value for the fall and holiday seasons, though it will stop short of bundling products at discounted prices. “We’re not going to go down the fast-food lane,” Mr. Schultz said.

There seems to be a correlation between luxury coffee purchases and luxury storage purchases. Zerowait has seen a significant up-tick in our service and support business this year. Bigger companies are asking us to take over legacy support for their filers, and the installations we are providing support for are larger.

Is there a correlation between Starbucks coffee and NetApp storage? NetApp HQ is on Java Drive, and there are affordable alternatives available to Starbucks coffee and High priced NetApp storage support. Around here we go to Dunkin Donuts for Coffee, and even in Sunnyvale, CA customers come To Zerowait for NetApp support.

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