Overview

EMC has announced the signing of a letter of intent to acquire Configuresoft, a privately held provider of server configuration, change, and compliance software. Founded in 1999 in Colorado Springs, CO, Configuresoft employs 140 people and serves over 400 customers-many of them shared with EMC. The deal is expected to close in June and will not have a material impact on revenue or EPS in 2009. Prior to this announcement, EMC had been working closely with Configuresoft via an OEM agreement signed in mid-2008. The Configuresoft team and location will remain intact, becoming part of EMC's Resource Management Software Group. Terms and conditions of the deal were not disclosed.

Analysis

EMC has been OEM'ing Configuresoft products as Server Configuration Manager and Configuration Analytics Manager (CAM) since last year. Because of this prior relationship, Configuresoft products are already integrated with other EMC resource management software products, as well as some from the RSA product line. This is relevant as it expands EMC's breadth of resource management offerings to include servers-both physical and virtual. While the OEM agreement also gave EMC this capability, ownership offers greater control and allows EMC to focus development efforts to match its object-based model going forward for even tighter integration amongst its products. With Configuresoft on board, EMC now owns and controls software in each data center technology domain to enable effective management of the next generation virtualized data center-the vast portfolio includes ControlCenter & Storage Configuration Advisor (storage), Voyence (network), Application Discovery Manager (applications), and, with this acquisition, Server Configuration Manager (servers). Overall, this shouldn't come as a big surprise, nor should it send shockwaves through the market. It has been EMC's stated intention to expand its Resource Management Software Group for some time now.  And EMC has been doing just that over the past several years, acquiring SMARTS, nlayers, Voyence, Infra, etc. to enable complete coverage of the data center. The company is also working very closely with virtualization technology vendors to enable the same level of management in virtualized data centers. Very little ramp up time should be needed as the EMC sales force is already selling Configuresoft products and the customer base is shared, including Configuresoft's claimed 13 out of 25 of the world's largest companies.

The Bottom Line

Owning this technology enhances EMC's ability to control the future direction of Configuresoft products and create stronger integration points with other components of the RMSG portfolio. It also emphasizes EMC's commitment to delivering a robust and fully integrated virtualized data center management solution. However, software integration takes time, so don't expect miracles overnight. Think in terms of ongoing incremental improvements. Another area to watch will be in the virtual server space; ESG would expect much tighter alignment with VMware, but Citrix and Microsoft may not be as excited about this acquisition and development for those products could suffer. For Configuresoft, this is a win: the team remains intact and in place, but now has the resources, reach, and support of a global company.  Configuresoft will be a part of a bigger solution, with access to all major enterprise customers. As long as these players continue to execute and deliver a quality solution, end-users should benefit as the Configuresoft products transition from point products to part of a fully integrated solution, enhancing the value of their investment. Additionally, this acquisition brings us one step closer to that elusive, ultimate goal: single pane of glass management for the data center.

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