So today, one of the new breed of cloud vendors got snapped up by an industry behemoth. Sunny times no doubt for StorSimple and its investors…and Microsoft’s relatively early purchase of this Cloud-integrated Storage player saved StorSimple from the pain of that awkward ‘growing up’ phase – the one that follows proving your concept, product and value, in which you have to get big traction. Microsoft can take care of that.
The news today was exceedingly plain (the fun stuff about $$ being undisclosed as one would expect), and the press release was barely a page. I found that refreshing and positive; in this business anything that takes too long to explain – and this is just as true of products as of acquisitions - is probably not very good in the first place. Here we have a pretty simple proposition:
- For StorSimple: the integration of on-premise and cloud storage is quickly becoming established as an attractive way for businesses to ‘get the best of both worlds,' in terms of using management control to balance the need to store massive amounts of new data with the need to constrain budgets. For the company itself, this sort of quick exit is clean and, invariably, offers a decent return.
- For Microsoft: with its focus on ‘CloudOS’ (described in today’s blog by Michael Park, the CVP of its Server and Tools Division as Microsoft’s “vision to deliver a consistent, intelligent and automated platform of compute, network and storage across a company’s datacenter, a service provider’s datacenter and the Windows Azure public cloud.”) this looks like a logical step for the owner of Azure.Oh, yeah, and it just happens to be the owner of Exchange and SQL and bunches of other data-heavy apps. Virtualization (a la HyperV etc) gets consolidation done, but this addition offers a safe next step to integrate, and make real, a hybrid cloud.
- For existing StorSimple users? While the company has done a great job of early adoption, let’s be clear: there are not tens of thousands of users. Moreover as Ursheet Parikh, StorSimple’s co-founder and CEO, stated in today’s press release, “Most StorSimple customers are mainstream IT organizations that have chosen Windows Azure as their primary cloud.” In other words there aren’t, in the big scheme of things, too many organizations that will be affected by any ‘push to Azure’ once the deal is finalized. In any case I can’t imagine the long-term value to Microsoft of removing the StorSimple capability for cloud choice: it will a) retain account control in any case and b) simply aim to make Azure ‘better together’ (a common theme across the industry these days) and more financially attractive.
- For other Cloud-integrated Storage providers: while all start-ups rightly argue about unique differentiation, there are natural groupings and companies such as Nasuni, Panzura, TwinStrata and others will no doubt notice an increase in their incoming phone calls over the coming days and weeks: they became instantly more interesting and valuable somewhere between last night’s hot cocoa and today’s morning coffee!
That’s it. It is not overly complex. The weather forecast is sunny for StorSimple, with more cloud activity on the horizon for Microsoft. The whether (sic) forecast for the market is to wait and see who’s next…lately the ‘big boys’ haven’t been hanging around once one of their number makes a move in any given market segment as no one wants to be left without a chair when the music stops!