Seagate, Veritas $2.7b merger aims at SANs

The much-hyped $US2.7 billion merger between Veritas Software and Seagate Software's Network and Storage Management Group has been given the official thumbs up.

The largest union between two software companies since the 1995 marriage of IBM and Lotus, the deal is aimed at taking the new-look Veritas to the forefront of the rapidly expanding storage area network (SAN) market, according to company officials.

Kevin Bush, Veritas' director of product management, said the merger is designed to consolidate its position in the SAN arena -- a market expected by analysts to be worth around $US5.5 billion by 2002 -- and give it the financial and geographical backing to develop cross-platform SAN applications.

The company has allocated $US1.5 billion to be spent on software research and development during the next five years, according to Bush, and plans to make Australia the hub of its Asia/Pacific operations.

"We can outspend our competitors now three to one. That $1.5 billion is going to develop our focus on what we consider to be critical systems.

"The customers that are here in Australia today are looking for ways to get more bang out of their buck when it comes to investing in this technology. We're working to lead in the area we do lead today in SAN technology and want to drive the standards. So that money goes towards investing in SAN, driving the standards in the new SAN arenas.

"We believe Australia is a strategic market for us and it will deliver a very significant proportion of our Asia/Pacific revenue."

In Australia, Veritas has five offices and employs around 29 staff. Bush said he expects that figure to climb to around 40 by the end of the year as a result of the merger.

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