Hewlett-Packard Co is set to buy database archiving specialist OuterBay Technologies Inc, making a forward bet on a niche technology, and taking control of a product that is already OEM’ed by HP’s largest storage rival, EMC Corp.
Privately held OuterBay’s software prunes databases of infrequently accessed data, moving older data to lower storage tiers in order to maximize application performance and reduce tier one capacity usage, and launched its first product around four years ago. Financial details of the purchase by HP were not revealed.
HP is counting on rapid growth in what is still only a very small and slow growing market for such software, and is basing its prediction on a widespread assumption that database volumes are set to mushroom.
They’ve bought into a technology that has yet to explode, said ESG analyst Brian Babineau. Based on a recent survey, ESG is forecasting 79% CAGR in tier-two database volumes between now and the end of the decade, when they will have reached 4,000PB of net new capacity. HP’s payback from OuterBay will likely come more from the hardware sales that will be driven by the software than from the software itself.
EMC began OEM’ing OuterBay’s software in 2003, and yesterday said that the OEM deal will continue after the HP acquisition. Given the currently small size of the database archiving market, EMC may not be seriously concerned about the OuterBay acquisition.
Babineau said however that the lackluster performance of EMC’s Legato backup software division may give the company more cause to take the future archiving opportunity more seriously.
HP itself began OEM’ing OuterBay’s software in September last year, in the form of its RIM Reference Information Manager. OuterBay’s largest rival in the database archiving market is Princeton Softech.