Lenovo is making a push into data storage, and it has enlisted market leader EMC to give its enterprise ambitions some momentum.
The two companies are embarking on a joint venture fueled by an unspecified amount of cash from Lenovo's and EMC's storage and server expertise. The companies hope that it will result in a big expansion of IT market reach for the firms. Lenovo will maintain a majority interest in the joint venture upon the deal's close.
Lenovo is eyeing new opportunities in networked storage and x86 servers as it gears up to compete for big corporate IT budgets. One step in achieving its goals is to grow its product portfolio, which is heavy on PCs and notebooks but comparatively light on end-to-end enterprise IT solutions.
In a statement, Lenovo chairman and CEO Yuanqing Yang signaled his company's eagerness to venture beyond personal computers. "Today's announcement with industry leader EMC is another solid step in our journey to build on our foundation in PCs and become a leader in the new PC-plus era," he said.
The journey involves teaming with EMC for a server technology development program to bring Lenovo up to speed in the x86 industry-standard server segment. Any server hardware that emerges will be sold under the Lenovo brand name while some systems will find their way into select EMC storage system.
For the storage piece of the puzzle, Lenovo is starting small with a joint venture that targets the small and midsize business (SMB) storage market. The plan hinges on technology from Iomega -- an EMC subsidiary -- for Network Attached Storage (NAS) systems that will be aimed at SMBs and distributed enterprises.
In China, Lenovo will sell EMC's enterprise-grade networked storage systems to its customers as an official OEM and reseller. Under this arrangement, the companies plan to expand into other territories following the same trajectory as their joint server initiative.
Taken altogether, Yang feels that the team-up will help Lenovo get its footing in the data center. "This partnership will help us fully deliver on our PC-plus strategy by giving us strong back-end capabilities and business foundation in servers and storage, in addition to our already strong position in devices," he states.
EMC, on the other hand, is hoping that the partnership will open new doors for the data storage giant in Lenovo's home market and keep its strong financial performance going. "The relationship with Lenovo represents a powerful opportunity for EMC to significantly expand our presence in China, a vibrant and very important market, and extend it to other parts of the world over time," said EMC CEO Joe Tucci in a statement.