EMC will wait out the economy, looks to Europe

EMC does not typically come here to the CeBIT trade show in order to show off its latest wares. Instead, the storage behemoth tries to paint a picture of its business to a European audience and gain ground in what it sees as a valuable overseas market.

Mike Ruettgers, executive chairman at EMC, is enduring a hectic CeBIT as he promotes his company and aims to boost EMC's overseas sales. At this time, the vendor sells only 40 percent of its products to customers outside of the US.

"We would like (sales) to be closer to 50 percent outside of the US" Ruettgers said in an interview. "We have made the investment overseas and are starting to see good results."

Ruettgers tried to attract customers here by putting forth a familiar message: "While the dot-coms are receding into the sunset, it is still clear that information creation is rising," he said, during a news conference. "As the amount of information increases, we expect our revenue to grow in stride."

Like many companies, EMC continues to suffer from a lagging US economy. The company made job cuts earlier in the year and then warned that revenues could fall below expectations for 2001. While Ruettgers admitted many obstacles remain in the months ahead, he tried to assuage pessimism about EMC's business by saying the vendor's prominent place in a rapidly expanding market ensures long-term success.

"Even though it appears there is hesitation in the US, we don't see customers abandoning their investments," he said.

While it is challenged by the likes of Sun Microsystems , IBM and Hewlett-Packard, the vendor remains confident that its place in the storage market is secure and that the storage market is the place to be.

Over the next year, EMC will cross the $1 billion mark in research and development spending for the first time in its history. Close to 70 percent of that total will go towards the company's software development. In 2000, EMC gobbled up 5 software companies and will make similar moves this year, Ruettgers said.

In addition, some of the company's largest clients such as ISPs (Internet service providers) will need so much help controlling their information that Ruettgers expects them to design what he calls Information Plants. These plants would be huge data warehouses, resembling a new age version of utilities such as electric or water plants.

EMC tried to outline this storage-rich future for European customers and convince them that the time to start preparing their infrastructure is now.

Barring an even more significant downturn in the economy, EMC believes it can steadily grow its business by leveraging its current technology and expanding overseas sales.

"We were never the dot in dot-com," Ruettgers quipped when referring to rival Sun's slogan. "EMC has never been that dependent on dot-coms."

"I am not worried about the competition."

EMC, in Hopkinton, Massachusetts, can be reached at +1-508-435-1000 or at http://www.emc.com/.

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