Perhaps overshadowed by a good earnings announcement from NetApp last week was an announcement that it closed on an acquisition of CacheIQ. This is a “tuck in” technology acquisition—made for the core IP rather than the product set. It is not material to NetApp from an earnings and expense standpoint, but it is likely to be quite material from a product and technology standpoint.
CacheIQ was still in the pretty early stages of product development—it had product concepts and some cool core technology that does data orchestration and QoS leveraging solid state, but nothing really GA on the market. So it was clearly not acquired for the product set or install base! Its technology, however, is a nice fit with NetApp’s vision of clustering and non-stop IT. Think about it—IT is consolidating and virtualizing. As the data center becomes more virtualized and “cloudy,” more and more virtual servers share the storage infrastructure. When a virtual server instance can be provisioned in minutes, that additional workload has an impact on the shared storage environment. The more virtual servers that share the environment, the bigger the ripple effects any service disruption can have. And we are not just talking about availability; NetApp has HA built into the architecture. The key issue is insulation from performance issues that these very dynamic environments can have because of the unpredictability of the environment. Seriously, how can IT provide any QoS and non-stop operations when new workloads can be added to the environment as quickly and easily as they can today? That is some of the secret sauce CacheIQ brings to the table.
NetApp has a spotty record when it comes to IP acquisitions (though I have to admit it has improved execution in recent years). Yet unlike past acquisitions, this is basic core technology and a talented team that is complementary and can slot nicely into existing development efforts—there is no real head-to-head contention for functionality. It is new technology that fits well into the direction NetApp has taken for OnTAP 8/cluster mode—it will be worth watching development efforts as it continues to invest in and integrate the CacheIQ IP. Inability to offer QoS for the core storage infrastructure can be a huge issue for large scale cloud and virtual environments, and is an issue that grows in criticality as the environment scales. This tech gives NetApp a path to solving that challenge.