T E C H N O L O G Y B U S I N E S S R ES E AR C H , I N C .
TBR EVENT PERSPECTIVE
EMC Assigns its Team of Companies to
Offense and Defense Positions for Next
EMC Analyst Event 2013
Boston; Oct. 31, 2013
Matt Healey (firstname.lastname@example.org), Principal Analyst
Geoff Woollacott (email@example.com), Senior Analyst
Christian Perry (firstname.lastname@example.org), Senior Analyst
Jane Wright (email@example.com), Senior Analyst
Krista Macomber (firstname.lastname@example.org), Analyst
At EMC’s Analyst Summit, on Oct. 31, 2013, the company outlined a strategy for addressing upcoming changes in
the IT landscape. Within EMC’s portfolio of companies, VMware and Pivotal have been assigned to play offense
while EMC II (its information infrastructure company for storage hardware) holds up the defense. While the
customer migration from traditional on-premises deployment models to cloud based delivery is well under way,
this is only the beginning of the transition. As more applications are moved to both public and private cloud
architectures, hybrid cloud will become the default architecture for IT. This will require vendors change the way
they deliver IT, as customers will demand open architectures that enable them to work with a variety of cloud and
traditional vendors as they integrate hybrid cloud into their existing IT environment.
TBR believes that EMC has embraced this industry shift. During times of significant change in the market landscape
vendors can react by going on the offensive and embracing the change, or by trying to defend the traditional
architectures. In the short term, the easier approach is to try to lock customers into the existing architecture.
However, this generally does not position the vendor for the long term. TBR believes EMC’s corporate structure
positions the firm for the long term. By embracing a “house of brands” approach to marketing and operations by
keeping EMC, VMware, Pivotal and RSA separate organizations, the firm has accomplished two things. First, each
brand is forced to operate independently. This requires them to be open to partnerships with other IT vendors
which will be a requirement as customers move to hybrid cloud architectures. Additionally, since the brands
operate more independently than segments within a traditional vendor, EMC has effectively built “cities without
walls.” EMC limits its brands’ ability to lock customers into their architecture thus requiring continuous innovation
to ensure that customer satisfaction. Second, EMC is able to add and modify its portfolio as conditions change. By
keeping the acquired companies independent, EMC can add to the portfolio as they did with VMware and most
recently Pivotal. Additionally, if conditions change, EMC can more easily exit businesses that no longer provide a
Pivotal will be key to EMC’s growth
TBR believes Pivotal is the most significant offensive move EMC has made since the investment in VMware. Pivotal
merges the PaaS technology from VMware with EMC’s big data capabilities, enabling customers to develop
applications that can handle big data in the cloud. The other advantage of Pivotal is it is being described by EMC as
cloud agnostic. By using Pivotal to develop applications, customers can deploy the applications on a various clouds.
Pivotal aims to become the platform that customer will need to develop the new breed of data heavy applications
as portability to a variety of cloud providers will limit the development time. By developing a platform that is open
and provides orchestration among a variety of cloud providers, TBR believes EMC is playing offense in the changing
environment. This offensive move has the potential to transform EMC in the same way VMware has over the last
decade. It enables easy migration to the new consumption model and positions EMC to be a trusted advisor.
Further, Pivotal positions EMC to participate in the production of the underlying products end customers will
purchase in this increasingly consumerized industry.
EMC has improved customer education on EMC solutions that lead to the new IT
From a services perspective, TBR believes that EMC is making progress in further defining its offerings and
formalizing service product marketing practices. EMC has never been a services lead vendor, rather choosing to
keep services at between 20% and 25% of total revenue and keep the offerings closer to the product. Services are
generally offered with the goal of supporting the customers and enhancing the customer experience. EMC detailed
the cloud assessment offerings that have been enabled by the tuck-in acquisition of Adaptivity, a small
organization with a unique analytics engine that provides cloud migration assessment capabilities that reduce
EMC’s time to output. These tools will be pushed out through the EMC ecosystem over time to both customers
and channel partners. Further, the overarching services strategy helps guide EMC’s approach to channel partners.
EMC’s goal is not to become a services lead organization, but the firm utilizes the channel to augment their
services capabilities. Customers can use either EMC services or channel services with EMC supporting the channel
partner as needed.
EMC is evolving its hardware platforms to accommodate the midmarket
From a hardware perspective, EMC is innovating to help to protect its status as the enterprise storage leader. TBR
views the midmarket as the largest opportunity for storage hardware growth, particularly as organizations in this
space leverage cloud and big data to extract value from their data stores. EMC is effectively evolving its VNX
unified (file, block and object) storage to compete with offerings from NetApp, HP and others by using multicore
optimization to take advantage of flash. Although EMC has a reputation for offering high-quality hardware at a
premium price point, the company is aggressively targeting the midmarket space from a price standpoint, which
TBR believes will help secure a foothold.
Flash is now a primary focus for EMC, as the technology is available in VNX, VMAX and Isilon. EMC stresses that its
flash platform is built on new architecture, which the company says differentiates it from other platforms on the
market that utilize decades-old platforms. EMC is also working to better integrate Syncplicity, its file sync and