EqualLogic was a company that specialized in storage area networks and network-attached storage systems. Founded in 2001, EqualLogic quickly became a leading provider of innovative storage solutions for small and medium sized businesses. However, in 2008 the company was acquired by Dell in a $1.4 billion transaction. This acquisition marked the end of EqualLogic operating as an independent company.
The Early Days of EqualLogic
EqualLogic was founded in 2001 by storage industry veterans Paula Long and Bob Potter. The company was based in Nashua, New Hampshire and focused on building storage area network (SAN) solutions specifically designed for the mid-market. At the time, high-end SAN products from companies like EMC and HP were prohibitively expensive for smaller organizations. EqualLogic aimed to make SAN technology accessible to these customers with innovative new products.
The company launched its first SAN product, called the PS Series, in 2003. The key differentiator of this product was that it utilized standard Ethernet and IP connectivity rather than the expensive Fibre Channel protocols traditionally used by SANs. This allowed EqualLogic SANs to leverage existing IP infrastructures, significantly lowering the cost of deployment. The PS Series was also designed as a modular system which enabled customers to start small and scale out as needed.
EqualLogic’s innovative approach resonated with customers and partners. The company reported $1 million in sales in its first month shipping products in 2003. Revenues grew rapidly, increasing more than 300% from 2004 to 2005 as EqualLogic expanded its customer base and product offerings. By 2007, EqualLogic was reporting $200 million in annual sales and had become one of the largest independent storage companies.
Acquisition by Dell
Given its strong growth and success taking market share from larger rivals, EqualLogic emerged as an attractive acquisition target. The company was officially acquired by Dell in November 2007 for $1.4 billion. At the time, this stood as Dell’s largest acquisition ever.
Dell had built its business on selling inexpensive servers and PCs direct to customers, but was looking to expand into more profitable enterprise IT sectors. Buying EqualLogic allowed Dell to quickly gain a presence in the fast-growing iSCSI SAN market. From EqualLogic’s perspective, the acquisition provided additional resources to continue growing while allowing the company to remain independent as a Dell subsidiary.
Initially, Dell ran EqualLogic as its own business unit. EqualLogic’s engineering and support operations remained based out of New Hampshire. The PS Series product line continued to be developed and sold under the EqualLogic brand. However, over time Dell integrated EqualLogic’s technology, sales and support into its larger storage division.
Why Dell Acquired EqualLogic
There were several key factors that made EqualLogic an attractive acquisition target for Dell:
- Proven product portfolio – The PS Series SAN line had gained strong market adoption and recognition as a leading iSCSI solution.
- Channel sales model – Unlike Dell’s direct sales approach, EqualLogic sold through a channel network of resellers and integrators. Acquiring EqualLogic gave Dell an instant channel presence in the enterprise storage market.
- Customer base – EqualLogic had over 4,000 customers from across many different industries. This brought Dell new customer relationships.
- Talented engineering team – EqualLogic had assembled a skilled engineering team with deep expertise in building scalable SAN solutions.
- Strong brand recognition – Within the iSCSI SAN market, EqualLogic had built a reputation as a thought leader through its innovative technology.
These strengths aligned well with Dell’s goals around entering the enterprise storage market. Rather than needing to build these capabilities in-house, acquiring EqualLogic gave Dell an instant presence in this new market.
Integration into Dell
Initially after being acquired, EqualLogic continued to operate as its own subsidiary within Dell while being officially part of the Dell Product Group division. However, deeper integration soon followed. Here are some key milestones in how EqualLogic’s operations were absorbed into Dell:
- 2008 – EqualLogic sales teams begin jointly selling with Dell’s PowerVault storage group.
- 2009 – Support teams are merged into Dell’s single support organization.
- 2010 – Dell aligns EqualLogic engineering and product development under common Dell Storage Engineering division.
- 2011 – The EqualLogic brand is discontinued and products are rebranded as Dell PS Series SANs.
- 2012 – Any remaining EqualLogic-specific roles are fully integrated into shared Dell Storage divisions.
Through this gradual integration process, EqualLogic ultimately ceased to exist as an independent entity. Its engineering, sales, support and products were all incorporated into Dell’s broader storage business. However, the core technology EqualLogic brought continued on and evolved through the Dell PS Series family of products.
Impact on Customers
For customers who invested in EqualLogic SAN solutions, Dell’s acquisition had significant impacts over time:
- Expanded support services – As part of Dell, EqualLogic customers gained access to Dell’s larger global support organization. However, some felt Dell’s support was less responsive than EqualLogic’s more dedicated model.
- Broader product portfolio – Dell offered a wider range of storage solutions across various price points. Customers benefited from having more options to scale up or down as needed.
- Lost agility and flexibility – Initially EqualLogic was able to rapidly evolve products to meet customer needs. Under Dell, the pace of enhancements slowed as processes became more structured.
- Branding changes – Losing the EqualLogic brand name was disruptive to some customers who viewed it as being distinct from Dell.
Ultimately customers saw both positives and negatives from EqualLogic becoming absorbed by the larger Dell organization. While support and services expanded, some felt the loss of EqualLogic’s startup culture and technical expertise.
Final Outcome
From an outside perspective, Dell’s acquisition of EqualLogic appeared to achieve its main goals:
- Gained strong storage IP – EqualLogic’s SAN platform gave Dell enterprise-class storage technology.
- Established channel presence – Dell rapidly gained a channel sales model through EqualLogic’s existing partnerships.
- Accelerated market entry – Buying EqualLogic allowed Dell to offer a compelling iSCSI SAN before it could develop one in-house.
However, over time the full benefits of integrating EqualLogic’s people and culture never seemed to fully materialize. While the PS Series SAN line remained a successful product for Dell, it failed to evolve significantly or drive major new innovations.
Some key former EqualLogic engineers eventually left Dell. In 2013, Paula Long went on to found a new storage startup called DataGravity. Other EqualLogic alumni played key roles in companies like Tegile Systems which pioneered new hybrid storage arrays. This demonstrated that much of the creative technical expertise that made EqualLogic successful resided with individuals who ultimately departed after the acquisition.
For customers, Dell continues to offer PS Series SAN solutions covering a range of needs from entry-level iSCSI to all-flash arrays. The technology has kept pace with recent innovations such as NVMe-oF support. However, Dell has broader storage portfolio depth today with other product lines serving larger enterprise customers. The PS Series caters primarily to the mid-range SAN market EqualLogic originally targeted.
Conclusion
Acquiring EqualLogic vaulted Dell into the enterprise SAN market and gave it valuable technology and customer relationships. However, the full vision of leveraging EqualLogic’s innovative culture ultimately fell short. Dell benefited from EqualLogic’s products and channel, but weaker integration of engineering talent and roadmaps left opportunity on the table. Still, the deal served its purpose in transforming Dell into an enterprise storage player through acquisition of a leading mid-market SAN vendor.