Quantum acquires Meridian; enters NAS market

Posted on June 01, 1999

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Quantum acquires Meridian; enters NAS market

Zachary Shess

Quantum Corp. last month announced plans to acquire Meridian Data, marking its entrance into the network-attached storage (NAS) market and its continuing expansion into the storage systems business.

With the acquisition, valued at approximately $85 million, Quantum will obtain Meridian Data`s low-end Snap! server business. And perhaps just as importantly, Quantum will own the server`s specialized operating system, which it plans to leverage for software development to support embedded intelligence in storage devices and systems, including DLT libraries and eventually hard disk drives.

"Our focus is to move the company up the value chain by providing software solutions optimized for our hardware devices," says Maury Domengeaux, vice president of marketing for Quantum`s recently formed network storage business unit.

Quantum officials expect to continue Meridian Data`s plan to reposition the Snap! server target audience from the SOHO market up to corporate workgroups. "We found that there is a larger market opportunity in the enterprise workgroup. It`s much tougher to sell to companies with small budgets who don`t have a dedicated IT budget," says Domengeaux.

Industry observers believe Quantum`s entrance into NAS will help legitimize the market and possibly lead other larger companies to buy into this niche arena.

"Quantum legitimizes the market because now you have a large company betting a large chunk of its business on the success of NAS," says James Staten, a senior analyst with Dataquest, a market research firm in San Jose. Staten says Quantum`s level of commitment to the NAS market is even higher than Dell Computer`s, for example, because Quantum is sinking greater resources into producing NAS products. In contrast, Dell OEMs filers from Network Appliance.

Quantum`s plans for Meridian`s optical storage business are more of a mystery.

While officials say they will support that product line, they did not say to what extent. Dataquest`s Staten sees the optical business as a "throw-in," but sees a remote possibility that Quantum could try to leverage the channels of its tape library subsidiary, ATL Products, to sell optical line.

Pending federal approval, the acquisition is scheduled to be finalized in September.


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