During EMC Corp.'s first-quarter earnings call this morning, CEO
Joe Tucci let the cat out of the bag that EMC has plans to release
a
Software as a Service (SaaS) offering in the
storage space soon.
Tucci mentioned the plans during a discussion on the call about
EMC targeting new markets and indicated areas where the company has
already moved into, such as data security and server
virtualization. SaaS was listed among the hot markets, and Tucci
told listeners to "stay tuned" for products in this area.
One Wall Street analyst asked Tucci pointedly during the Q&A
if this would mean further acquisitions, a subject on which Tucci
was coy. "How much we'll develop ourselves or with our partners,
and how much of this we'll 'jump start' by doing a small
acquisition, we still want to keep to ourselves right now," he
said.
However, Tucci also indicated that the products would be in the
data backup and archiving space. "We'll have another alternative
there for our customers, hosted on our premises," he said.
SaaS has begun to take off in storage as large Web companies,
like Yahoo Inc. and Google Inc., step into the enterprise storage
space, and it's growing clear that traditional storage players are
reaching for their slice of the pie. In a separate announcement
today, Symantec Corp. announced Symantec Protection Network, a
software as a service (SaaS) platform aimed at small and midsized
businesses (SMB). The first SaaS offering from Symantec, Online
Backup Service based on Backup Exec, is scheduled to become
available later this year.
EMC's earnings solid
EMC also has plans to introduce more low-end storage products,
despite the dissolution of its Insignia business unit and
languishing of its low-end backup software product, EMC Retrospect.
According to Tucci, EMC will be launching hardware/software IP
storage area networks (SAN) and all-in-one bundles for SMBs this
year.
Since acquiring RSA Security Inc. last June, Tucci said,
revenues for that company have increased by 25% each quarter, and
for the first quarter its $120 million in revenues represent a 25%
increase year over year, if EMC had owned the company in the first
quarter of 2006.
VMware Inc. was up 95% year over year to $256 million during the
first quarter and places the company's revenue on an annualized run
rate of more than $1 billion.
Total consolidated revenue for the first quarter of 2007 was
$2.98 billion, 17% higher than the $2.55 billion reported for the
first quarter of 2006. Compared with the first quarter of 2006, EMC
systems revenue increased 6%, software license and maintenance
revenue increased 29% and services revenue grew by 21%. The company
saw growth in Smarts, Networker and especially Rainfinity, where
officials said growth was "in the triple digits," though a precise
number was not given.
"EMC is showing higher operating expenses, primarily on the
sales and marketing side, but our bottom-line conclusion is that
these results set EMC up well for 2007," Goldman Sacks analysts
said in a note to investors.