Data Domain has been a longtime partner of NetApp’s, which is probably one reason that NetApp finally decided to make them an offer. Another reason why it’s right to do this now is that in today’s economy, NetApp could get the best price.
The final reason that NetApp and Data Domain should hook up is that there are not many other major storage vendors that don’t already have a dedicated deduplication appliance or two. If Sun were still around it might make sense for them to think about buying Data Domain but they are out of the picture until Oracle figures out what to do with their storage business. EMC has bought Avamar and invested significantly in Quantum. IBM has purchased Diligent, Symantec has PureDisk. HP already has a deduplication product. The only major vendor without dedupe today is HDS.
Data Domain had a lot going for them. They practically defined the target deduplication appliance market. Diligent (now with IBM), Quantum, Sepaton, and others notwithstanding, Data Domain had the largest market share out there and was continuing to experience rapid growth. The fact that Data Domain both supported NAS as well as VTL access modes coupled with their excellent market share made them a prime acquisition on many fronts.
NetApp, of course, has their own deduplication technology which has been very successful in supporting virtual server environments primary storage and was also used to support secondary storage. No doubt over time these two technologies could conceivably merge into one. But don’t hold your breath, some companies have way more than two distinct deduplication technologies which are used for their various products and NetApp may not feel its worthwhile to combine the two technologies in the near future given there two different markets.
All in all, consolidation is necessary evil today.