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  • /Partners: HPE’s $1 Billion Nimble Storage Acquisition Set To Reshape All-Flash Market, Force Strategic Changes For Competitors

Partners: HPE’s $1 Billion Nimble Storage Acquisition Set To Reshape All-Flash Market, Force Strategic Changes For Competitors

By Steven Burke on March 7,2017 on CRN.com

Hewlett Packard Enterprise’s $1.09 billion acquisition of Nimble Storage is set to alter the balance of power in the all-flash data center market.

Partners said the blockbuster deal is sure to have repercussions on Nimble’s partnerships with HPE competitors such as Cisco Systems.

“It’s a total land grab,” said Michael Knight, president and CTO of Encore Technology Group, a Greenville, S.C.-based solution provider, No. 376 on the 2016 CRN Solution Provider 500 [3]. “Nimble partners with Cisco and a lot of other providers with ecosystem integrations. In the storage space, this is just as big as Aruba being acquired by HPE. All the OEMs that work with Nimble are taking four steps backward right now thinking what the hell just happened?”

The acquisition is HPE’s fourth acquisition in the past month as it moves quickly to grab the most disruptive technologies aimed at providing HPE technology leadership in the hybrid cloud market.

The deal comes even as HPE’s recently completed $650 million acquisition of hyper-converged provider SimpliVity forces competitors like Cisco, Lenovo and Huawei – who had teamed with SimpliVity — to alter their hyper-converged path. The Nimble acquisition is going to have the same kind of market reverberations, said partners.

“This is definitely going to shake up the all-flash market,” said Knight. “Cisco just got hit with the SimpliVity acquisition and now Nimble, and they are not obviously on great terms with Dell EMC so they are going to have to make some choices. There are a lot of players that had tight integrations with Nimble.”

Knight said he sees HPE as a major disruptive force in the infrastructure market. He said HPE was attracted to Nimble’s breakthrough Nimble Cloud Volumes offering – a new storage-focused cloud service aimed at making it easy for customers to switch between multiple clouds. “That’s a high-value storage play with connectivity to the cloud,” he said. “HPE is going after the market. HPE is going after every innovative pure-play provider and bringing them into the fold.”

Michael Goldstein, CEO of LAN Infotech, a Fort Lauderdale, Fla. ,solution provider, said he sees the Nimble acquisition as another HPE infrastructure game-changer.

“Nimble has a great product — this is going to really help drive sales growth for HPE in the all-flash data center market,” said Goldstein. “This tightens HPE’s hold as a one -top data center shop. This is going to help our HPE business. It brings something new to the table. It provides HPE with new hot technology to drive growth.”

Mont Phelps, founder of NWN, Waltham, Mass, No.68 on the 2016 CRN SP 500, said he sees the acquisition as another jewel in the technology crown of a more nimble HPE.

“Nimble is a strong innovative player in that all-flash market,” he said. “This is about HPE taking an emerging technology and providing it with a significant market position and then scaling it.”

Phelps credited HPE CEO Meg Whitman with pulling together a portfolio of innovative and disruptive technologies.”That’s the benefit of having a more focused company,” he said. “Meg is building out those technologies in a robust fashion, whether it is through acquisition or internal development. This is a departure from bigger is better. It is about assembling a competitive portfolio of technology and then driving it into the market.”

Bob Venero, CEO of Holbrook, N.Y.-based solution provider Future Tech, No. 187 on the 2016 CRN SP 500, said the acquisition sets up an epic infrastructure battle between HPE and Dell EMC.

“There are going to be two de facto behemoth players in this market – HPE and Dell EMC,” said Venero. “I see both companies continuing to go down the acquisition path. There is no question about it. Dell took the first big bite with EMC and created an incredibly large and nimble private company. It is going to be interesting to see if the HPE Nimble acquisition is going to be accepted by stockholders and whether it is sustainable in the future.”

Venero said “communication and execution” will be key as HPE moves to complete the Nimble deal. “HPE needs to be really clear about how they are going to integrate Nimble and what it means for customers and partners,” he said. “This is not a $50 million acquisition.”