The complexion of the IT landscape continued to change this week as Oracle has reportedly decided to end the long-standing storage partnership between Sun Microsystems and Hitachi Data Systems (HDS).

According to a letter to partners purportedly from HDS and posted to the blog of Chi Corp. vice president Greg Knieriemen, HDS and Sun will end their current distribution agreement on March 31, 2010.

The letter also states:

“Hitachi Data Systems and Oracle agree that the time is right to evolve this relationship into one reflecting the priorities of the new company. We are jointly determining the positioning of the products and solutions based on Hitachi Data Systems that you have deployed with clients. We understand you and your customers have questions and concerns surrounding service obligations to the global install base moving forward.”

Hitachi Data Systems reiterated its stance in an e-mail statement sent to InfoStor. It reads:

“With the acquisition of Sun Microsystems, Hitachi Data Systems and Oracle agree that the time is right to evolve this relationship into one reflecting the priorities of both our companies. Hitachi Data Systems and Oracle are in active discussions to broaden its current relationship in many areas – application integration and optimization is one example with many benefits to our customers. Our main priority is to ensure that we are working together to ensure that our customers are being fully supported during this time of transition, and we are both committed to providing the exceptional service both our companies are known for in the marketplace. We look forward to sharing more details on our expanded relationship in the coming months.”

Under the current deal, Sun resells the high-end HDS Universal Storage Platform (USP) V arrays.

The news comes on the heels of Oracle’s recently announced Exadata Storage Servers, which are based on Sun’s storage technology (see “Oracle becomes one-stop-shop with Sun storage, servers”).

However, there may be a silver lining on the horizon for HDS, at least in the near-term, according to David Vellante, co-founder of the Wikibon Project.

“The Sun/Oracle [acquisition] definitely hurt HDS this year, but they still managed a record revenue quarter, doing more than $800 million in the December quarter up in the mid-to-high single digits over calendar year Q4 2008,” Vellante says. “And those numbers exclude [HDS’ partnership with] HP, which goes directly to Japan.”

“I think this is actually an opportunity for HDS and its resellers to sell direct because Oracle’s idea of high end storage is expensive RAC and expensive Exadata – both good products, but purpose-tuned for Oracle apps only and not shareable across the enterprise,” says Vellante.

The Oracle-Sun-HDS partnership is the second major vendor relationship to succumb to the changing IT landscape in as many weeks. Cisco and Hewlett-Packard will officially part ways on April 30, after Cisco announced that it would not renew its system integrator contract with HP (see “Cisco-HP partnership implodes”).


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