HP grabs storage virtualization with LeftHand acquisition

Yesterday, HP announced that it had signed an agreement to acquire LeftHand Networks, a leading provider of storage virtualization and iSCSI storage area network (SAN) solutions. The deal came in at $360 million despite the current economic conditions, a lot of money to be sure, but not nearly the $1.4 billion that Dell announced it would spend to acquire EqualLogic back in November of 2007.

The acquisition helps HP better compete in the mid-market with Dell and other rivals. As established vendors in the SAN market have been adapting their Fibre-Channel solutions to support the less-expensive iSCSI solution, vendors such as LeftHand have been creating newer software that’s cheaper and easier for customers to use. And market data provided by IDC shows corporate spending on storage products have increased around 17 percent during the first half of the year.

Dave Roberson, senior vice president and general manager of the StorageWorks Division at HP, said “The acquisition of LeftHand Networks significantly expands our storage portfolio, enabling HP to deliver customers an expanded suite of storage functionality, scalable capacity, and interconnect options for every budget and performance requirement.”

HP said that with the addition of LeftHand Networks, they are going to add midrange offerings to their existing suite of iSCSI solutions. The low end of the market will be met with the HP StorageWorks All-in-One Storage System (AiO) and HP StorageWorks Modular Smart Array (MSA) product lines while the high end will be addressed by the HP StorageWorks Enterprise Virtual Array (EVA) line.

LeftHand Networks’ portfolio extends HP virtualization solutions to the midmarket with software that runs on both existing storage and industry-standard server hardware. No indication has been made yet whether LeftHand’s support of competitor hardware will continue, but LeftHand Networks’ solutions are already certified to work with a wide range of HP products, including HP ProLiant servers, HP BladeSystem infrastructure, HP ProCurve Networking, and HP Insight Control management software.

The acquisition also gives HP new capabilities in the virtualization environment. LeftHand has intelligent cloning technology that can reduce the amount of disk space required for storage by up to 97 percent. To reduce power consumption, the company has a thin provisioning feature to minimize the over-provisioning of storage. And they also offer advanced data replication technology with bandwidth management and failover protection — making it ideal for backup and disaster recovery operations between remote offices and a central location.

The transaction is expected to be completed in HP’s first fiscal quarter of 2009. Following completion, the business will be integrated into the HP StorageWorks division within the Technology Solutions Group at HP. No news as of yet whether the product will be rebranded, and nothing was mentioned about what happens to LeftHand’s 215 employees or 500 resellers and distributors.