IBM to acquire Softek, looks to pump up services biz

IBM said it intends to fold Softek's host-based Transparent Data Migration Facility (TDMF) data migration software into its IBM Global Services (IGS) division, within the storage and data services business unit.

Softek and IBM have a long relationship; IBM has been a Softek global partner since 1996. Softek's software supports mainframe as well as open systems data and has come in especially handy in the mainframe business, which continues to drive large maintenance deals for IBM.

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On a call with media Monday morning, Val Rahmani, general manager for infrastructure management services, said this acquisition is "the next logical step in the transition of the IGS business to a preintegrated, asset-based standardized set of products that can be rolled out globally to our customers." Rahmani said the acquisition last year of Internet Security Systems (ISS) was also part of that strategy. Softek's product will be sold as standalone software, as a product-based engagement or as an entirely outsourced service through IBM, Rahmani said.

Rahmani hinted that further acquisitions could be in the offing, saying that IBM is still looking to expand IGS, but declined to comment on what category of service IBM might next look to try to expand.

According to Tony Asaro, analyst with the Enterprise Strategy Group, "This seems like more of a strategic than a tactical acquisition—this could be an undercover way of trying to get more storage business with [Softek] as a foot in the door." One way this could happen post acquisition, according to Asaro, would be for users to outsource data migration to IBM as part of an ongoing tiered storage plan.

"[A] host-based nondisruptive migration tool for both open systems and mainframes [is] a simple application but surprisingly one of the most demanded in the market, as IT swaps out technology or introduces new technology," said Arun Taneja, founder and analyst with the Taneja Group.

One of the twists to the acquisition, according to analysts, is a relationship between EMC Corp. and Softek -- EMC resells one of Softek's products as the EMC/Softek Logical Data Migration Facility (LDMF). Meanwhile, IBM has specifically called out EMC in its last several product announcement press releases and again referenced EMC in a note to media on the Softek acquisition, saying that TDMF will give IBM "a rapid-fire data mobility strike force … allowing them to trump EMC with a weapon it doesn't have."

"Right now, EMC has no choice but to remain partners with Softek, but they probably should look into other partnerships or internal development to get away from it," said Tony Asaro, analyst with the Enterprise Strategy Group.

"Watch EMC accelerate the integration of Kashya product into InVista now," Taneja said. "It certainly represents a network-based alternative, but it doesn't do anything for mainframes."

Softek has close to 800 customers in total and over a dozen resellers, including EMC, Fujitsu Ltd., Hewlett-Packard Co. (HP), IBM and Siemens. Softek's clients include British Telecom, KeyCorp, Lufthansa and the Principal Financial Group.

TDMF is Softek's most popular product and was the basis for its spin-off from Fujitsu Ltd. in April 2004. According to Softek's Web site, the versions of the product available include TDMF Unix, which performs local data movement on UNIX for tech refresh, competitive replacement and performance tuning; TDMF Unix/Linux (IP) for distance migration and server migration; TDMF Windows (IP), which does both local and remote data migration for Windows systems; and TDMF z/OS, for mainframe migrations.

"Most users probably wouldn't even know Softek has an offering on the open systems side," Asaro said. "Hopefully IBM will be able to make them stronger in terms of market penetration in that area."

Softek also has data replication products similar to those offered by Topio Inc. and Kashya Inc., now a part of Network Appliance Inc. (NetApp) and EMC respectively. Softek's replication is host based, which means it's "not exactly a head-to-head comparison," according to Asaro. "But IBM could still position Softek's products in that space."

The Softek product has its earliest roots in a company called Amdahl, now a part of Fujitsu. Amdahl was a "huge competitor" to IBM in the mainframe days, according to John Webster, principal IT advisor with Illuminata Inc.

"It's a bit of a historical twist that IBM is acquiring one of the last vestiges of them," he said.