Since 2003, when EMC launched its transformation from a simple hardware storage vendor to a multifaceted information-infrastructure provider, it has racked up 15 straight quarters of double-digit revenue growth and strong profits.
However, the company's stock price has been essentially flat over that period, an indication that for Wall Street at least, the jury is still out on whether EMC can deliver on its grand vision of information management.
Customers and industry analysts agree that the company has made great strides over the past few years in laying out its strategy and in making key acquisitions aimed at filling out its portfolio.
But they also agree that EMC still has work to do. Specifically, the company needs to:
-- Integrate its many acquisitions into a coherent product line.
-- Project a clear marketing message to customers and shareholders alike.
-- Retain the high regard it has from customers by making it easy for them to buy products and get service and support across product lines.
-- Deliver more profits.
Since its buying binge began with the acquisition of backup vendor Legato in 2003, EMC has pieced together components that will help its customers not only store data, but manage and secure enterprise data no matter where it resides on the network.
In addition to Legato, EMC has snapped up security vendors RSA Security, Network Intelligence and Authentica, virtualization players VMware and Rainfinity, content-management providers Documentum and Acartus, and management vendors ProActivity and Smarts. All told, EMC has spent US$7 billion to get more than 20 companies.
This dizzying pace has some customers wary. "It concerns me that so much acquisition will eventually cause integration difficulties for us," says Ann-Marie Horcher, senior groupware specialist at Dow Corning in Midland, Mich. She uses VMware and Documentum. "You can't expect everything to play together nicely," she says.
EMC appears to be on the same page as its customers when it comes to the integration issue. The company hasn't made any major acquisitions this year and Mark Lewis, executive vice president and chief development officer, says the buying spree is, for the most part, over.
"We're phenomenally well positioned with the assets we've built internally and those we've acquired over the last several years. Aside from smaller technology 'tuck-in' acquisitions, there are no large deals on the drawing board,'' Lewis says. (EMC did make one of those tuck-ins in early June, when its RSA division picked up tiny identity-verification services vendor Verid.)
"Integration of all this technology, woven together in a seamless orchestration -- what we refer to as information infrastructure -- is our strategic move, and will steer the way for the future of information management,'' he adds.
Integration is no small challenge, but EMC has made announcements indicating that it is a top priority. For example, at its May user group meeting, the company announced that by year-end it will begin delivering a common platform for managing the company's myriad storage lines.