EMC Corp. is stepping up its activities in the grid technology space via a tie-up with customer information management company Acxiom Corp., the storage giant announced Thursday. EMC is also making its first significant acquisition of grid technology, paying US$30 million to purchase Acxiom's information grid software, which Acxiom originally created to meet its needs and those of its customers.
Under the terms of the agreement, for the next two years EMC and Acxiom will jointly develop and market an Acxiom-hosted and Acxiom-branded information grid to customers, according to Ian Baird, chief technology officer, grid and utility computing at EMC. During that same time period, the two companies will work on building non-hosted business intelligence grid software that customers can deploy within their own firewalls, he said in a phone interview Thursday. The non-hosted grid will become an EMC product, Baird added.
As end users begin to look at running their businesses in more distributed computing environments, grid computing is becoming a more attractive option. It's often touted as a way to help enterprises increase the utilization of their computing resources as well as improve their access to information and workflow. Although EMC will own the information grid software, Acxiom will continue to have access to it and be able to develop it further and use it in connection with its business.
Baird joined EMC a year ago from grid computing software vendor Platform Computing Inc. "to start driving [EMC's] grid initiative," he said. Grid efforts were already underway at EMC, thanks to Jeff Nick, the company's senior vice president and chief technology officer. Nick joined EMC in September 2004 after a 24-year career with IBM Corp. where among other positions, he led the company's grid computing strategy and designed its On Demand initiative.
While much of EMC's commitment to grid computing publicly has been represented in the company's membership of and contributions to the leading grid standards bodies, plenty of work has been going internally at the vendor, according to Baird. EMC has recruited other staff with grid expertise and acquired a number of technologies that relate to or are complementary to grid technology, he said.
Anne MacFarland, director of infrastructure architecture and solutions at analyst The Clipper Group, agreed with Baird. "This is a significant move," she said. "EMC has been buying up all the piece parts needed to make this [grid computing] happen."
"This is the first acquisition of any size we've done in the grid arena," Baird said. "It's more than a toe in the water. We haven't dove in the deep end, but we're about midway across the [grid swimming] pool."
EMC spent much of the past year looking at a lot of different grid companies, according to Baird. "Most only offered point solutions like workflow management or schedulers," he said. The company came across the Acxiom grid by chance when visiting the company, which is an EMC customer. "They [Acxiom] had a fully integrated grid operating in a very robust production environment," Baird said. "We were quite impressed and spent months working with them."
He admitted it was a little unusual for EMC to team up with a customer for technology instead of its usual partners, which tend to be software companies. "Acxiom has effectively been in stealth mode [with their grid] for their own purposes," Baird said. "We can help them monetize and market it."
In addition to purchasing Acxiom's information grid software, EMC will take on a group of 100-plus Acxiom developers who have been working on the grid, Baird said. Those employees will be housed in an EMC grid business incubation unit, which will also take on an unspecified number of EMC staff, he added.
Acxiom has something of a checkered past. In December 2005, the company's board of directors rejected a hostile bid from ValueAct Capital to acquire the company. Among the key factors Acxiom's board listed in a release for turning down the offer was "Confirmation that the Company's investment in grid technology would soon be validated through a long-term development and go-to-market strategic relationship with a major technology company" -- in other words, the partnership with EMC.
Acxiom had also had to deal with the fallout from a major hacking attack. In August of 2005, Florida resident Scott Levine was found guilty of stealing an estimated 1.6 billion customer records by hacking into an Acxiom server between April 2002 and August 2003. Acxiom has stated publicly that since the security breaches were first uncovered in the summer of 2003, the company has worked to improve its intrusion detection, vulnerability scanning and encryption systems.
"In our assessment, we feel very confident that Acxiom is a good company to work with, a powerful company, with an incredible wealth of giant Global 2000 companies," Baird said, pointing to Acxiom customers including General Motors Corp., Bank of America Corp. and Sears, Roebuck and Co.