EMC Plans Acquisition, Raises Stakes in ESS Market

Feeling the nibble of IBM's Shark Enterprise Storage Server (ESS) on its heels, EMC Corp. (Hopkinton, Mass.) announced it plans to purchase Data General Corp. (Westboro, Mass.), well-known for its CLARiiON Fibre Channel storage systems, high-end Windows NT and Unix AViiON servers, and related software and services.

The transaction, reportedly valued at about $1.1 billion, is expected to close before the end of 1999 and add profits to EMC's bottom line as early as next year, according to CBS MarketWatch. EMC is already the leading U.S. maker of computer data storage products.

According to CBS MarketWatch, EMC hopes the deal will "broaden its reach into the rapidly growing midrange data storage market," reportedly worth about $10 billion in 1998. More than improving upon the technological capabilities of Data General's CLARiiON storage products, EMC's acquisition is expected to provide a higher level global distribution and support than Data General could provide on its own.

EMC's acquisition of Data General follows IBM's announcement of a product code-named "Shark," an ESS that will attach to the IBM's full line of enterprise servers, including AS/400, S/390, RS/6000 and Windows NT. Building upon IBM's Storage Area Network (SAN) initiative announced on June 22, the Shark's capacity will range from 420 GB up to 11 TB of data and should challenge EMC for supremacy in the high-end storage systems market.

--L. Greenemeier