UPDATED 13:48 EDT / JULY 05 2011

Pillar Acquisition: A Major Bust?

Days after Oracle released a statement saying that the company will not be making any acquisitions anytime soon due to the fact that Oracle is focusing more on internal growth rather than acquisitions, they purchased Pillar Data Systems – a private technology storage company majorly owned by Oracle CEO Larry Ellison.  Much like with their competitors, the acquisition was made to be able to give their clients full service in the cloud, though the deal was, to some extent, an internal affair.

“Are we serious about storage? I hope that the feeling is yes,” said Mark Hurd, Oracle’s President, during a storage event at the company’s headquarters on Thursday afternoon. “We have got a full family of capabilities now.”

Though other competitors like Dell, which acquired Compellent, and HP, which acquired 3PAR last year, have been making big plans for their recent buys, it is not the same case with Oracle.  When Dell and HP acquired their own storage companies, the Company CEOs  still remained as the crucial member of the team. But Oracle did not do the same. Pillar CEO Mike Workman won’t get star treatment, and the reason for this could be that Pillar wasn’t able to deliver what was expected from them.

“The timing was good for Pillar’s creation 10 years ago. There were other storage startups adding their own secret sauce, both software and hardware, to make disk arrays do more yet cost less and be easier to manage. Workman’s bad luck was to end up competing with two companies that did it better in their markets. Both were run by experienced guys too and had, it has been suggested, better all-round executive teams than Pillar…

There was no effective way Pillar’s Axiom could match 3PAR’s high-end box. Nor could it match the box produced by Phil Soran, Larry Aszmann and the other members of the founding team that built Compellent’s Storage Center into a devastatingly effective array for the mid-range. Compellent competed with CLARiiON and 3PAR with the DMX and both became the leading SAN competitors to EMC in these areas, leaving Pillar to pick up crumbs in the sparsely-populated ground between these two great companies.

As consumers, when we purchase something but are not satisfied with it, we can either swap it with something else we think we like much better, or return it to get our money back.  But with acquisitions such as this, there are no take-backs.  You either live with the consequences of not gaining anything from it, or put it on the far-end of the table and hope that the right moment comes and you can finally benefit from it.


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