Overland Storage Fiscal 4Q10 Financial Results

Overland Storage, Inc. announced its financial results for the fourth quarter and fiscal year ended June 30, 2010.

Overland Storage reported revenue of $19.3 million for the quarter ended June 30, 2010, an increase of 3.7% from the prior quarter. The net loss for the fourth fiscal quarter was $4.2 million. This includes $1.2 million of non-cash, stock compensation expense.

For the twelve months ended June 30, 2010, the company reported revenue of $77.7 million, compared with $105.6 million for the twelve months ended June 30, 2009. The net loss for fiscal year 2010 was $13.0 million, compared with a net loss of $18.0 million in the prior fiscal year.

Cash and cash equivalents as of June 30, 2010 were $8.9 million compared with $5.5 million as of June 30, 2009.

Eric Kelly, President and Chief Executive Officer of Overland Storage, said: " We are pleased to have stabilized revenues, as the growth of our strategic branded products and stability of our service business has helped to compensate for continuing declines in the OEM business and challenging global economic conditions. This provides the foundation necessary to drive future revenue growth."

Kelly added: "Looking ahead, we remain focused on three strategic priorities - implementing a new asset light business model, driving innovation and expanding our addressable markets. We look forward to describing key milestones in upcoming months and are pleased to resume providing forecasts of certain operating metrics."

Business Outlook
Based on information available as of August 26, 2010, Overland Storage is issuing guidance for the first half of fiscal 2011 as follows: the company expects first half revenue to be in the range of $35 million to $38 million, gross margin in the range of 27 to 31 percent and operating expenses in the range of $18 million to $20 million, including non cash stock compensation charges of $1 to $2 million. Our ability to continue to execute and hit our targeted milestones will assist us in our goal of becoming profitable during fiscal 2011.

Overland Storage Wins 'One To Watch' At the Storage Awards

Overland Storage has won the ‘One to Watch’ award with its SnapServer SAN S2000 at the 2010 Storage Awards held at The Tower Guoman Hotel, London. Overland Storage is a global provider of effortless data management and data protection solutions across the data lifecycle.

The Storage Awards are hosted by Storage Magazine, the UK’s leading storage industry publication. Readers of Storage Magazine, who pick the winners by popular vote, cast more than 25,000 votes across a wide range of storage categories.

Andy Walsky, vice president of sales and marketing EMEA at Overland Storage said: “Overland is bringing to market game-changing storage solutions like the SnapServer SAN S2000 that address the management, performance and scalability shortcomings of tradition storage solutions. This award acknowledges our execution in delivering market-leading storage solutions to our channel partners.”

The SnapServer SAN S2000 is a 2U iSCSI SAN appliance designed specifically for businesses with growing storage needs and limited resources to manage an end-to-end storage strategy. It features active-active mirroring and failover, snapshots, replication, automated capacity expansion, centralised management and support for Microsoft Cluster Server. With automated capacity expansion, policy-based storage volume expansion can be easily deployed in a just-in-time manner without IT intervention, eliminating guesswork and over-provisioning.

The S2000 scales effortlessly to 192TB to support storage growth requirements over time. With simplified and integrated user interfaces, the SnapServer SAN S2000 is a cost-effective solution for businesses with virtual server environments or storage consolidation requirements.

Overland Storage’s New iSCSI San Solution Delivers Effortless Data Management and Data Protection

Overland Storage, which operates in the same industry as companies like Quantum Corporation and Hewlett Packard, Inc., noted that its SnapServer SAN S2000 expands Overland’s market reach across the data lifecycle.

Overland Storage, the trusted global provider of effortless data management and data protection solutions across the data lifecycle, today announced the new Overland SnapServer SAN S2000: a feature rich, resource-efficient iSCSI SAN platform for businesses with growing data. The SnapServer SAN S2000 enables companies with Windows, VMware, Hyper-V, UNIX, Linux, or Mac OS X to take advantage of SAN capabilities that have traditionally been considered too complex to manage without specialized expertise, including active-active mirroring and failover, snapshots, replication and Microsoft Cluster Server support. Featuring automated capacity expansion, the solution enables policy-based storage volume growth to occur in a just-in-time manner without IT intervention, eliminating guesswork and over-provisioning. The SnapServer SAN S2000 scales effortlessly to 120TB and is a cost effective solution for businesses with virtualized server environments or storage consolidation requirements.

Optimized for Use in Virtualized Server Environments

• VMware –The SnapServer SAN S2000 integrates directly into the VMware management application to provide a host of advantages that include: simplified data store creation wizards for provisioning targets, the ability to provision storage for ESX clusters within VMware utilizing customized SnapServer tools, single interface configuration for SnapServer targets and VMware high availability for ESX data stores using native VMware utilities (DRS, HA, VMotion) with the SnapServer SAN active-active failover
  option.


• Microsoft Hyper-V –The SnapServer SAN S2000 is certified to support Windows Hyper-V Server for Microsoft virtualization deployments. With customized tools developed for the SnapServer SAN it enables simplified management of Hyper-V for backup utilizing VSS (volume shadow copy services), replication and mirroring. In addition the SnapServer SAN supports direct pass through access for guest virtual machines enabling higher performance and security.

Simple Management and Deployment

“The new SnapServer SAN S2000 has allowed us to provide networked block-based storage to multiple servers and easily manage our data growth from a single interface,” said Darren Dong, director of communications and web development at Riverside Community College District, an early beta tester of the SnapServer SAN S2000. “Our Fibre Channel SAN was making it difficult and expensive to map across multiple systems. The SnapServer SAN S2000 allows us to easily manage existing connections and create new ones as needed. We now spend a fraction of the time setting up and monitoring our storage solutions due to the ease of use of the S2000 and SnapServer Manager.”

Effortless Data Management and Data Protection, Wherever Data is Located

The SnapServer SAN S2000 is the first iSCSI SAN solution to fully integrate autoprovisioning, an automated capacity expansion feature. With this feature, storage volumes are automatically expanded based on predefined policy – without requiring intervention. Disk usage is also tracked, giving IT administrators the ability to easily monitor and manage disk capacity consumption across the organization. Companies with standalone or clustered Windows servers running business critical applications, such as Microsoft Exchange and SQL Server, can utilize the SnapServer SAN solution’s active-active failover capabilities to ensure high availability and maximum uptime. Advanced replication functionality that supports up to 256 snapshots and failover ensure data is protected and accessible at all times – regardless of its location – while accelerating backup efficiency.

“Businesses large and small face similar data storage growth challenges – but often without the resources or expertise to effectively deploy a SAN. They need a solution that can be easily deployed, is simple to manage and can accommodate growing amounts of data,” said Benjamin S. Woo, program vice president of enterprise storage systems at IDC. “Especially as more companies deploy virtualized environments, it becomes even more complex to manage data
growth over the long term. With autoprovisioning technology like that in Overland SnapServer SAN S2000, companies can ensure that their storage solution can support business growth without having to pre-determine storage requirements or running the risk of over-provisioning.”

Features and Benefits

• Automated capacity expansion – The SnapServer SAN S2000 easily manages storage growth with an autoprovisioning feature that tracks disk usage and automatically extends volumes that reach pre-defined thresholds, without requiring IT intervention.


• Simple storage management – With SnapServer Manager, IT managers can easily monitor and manage all SnapServer SAN and NAS systems remotely or locally via a Windows-based application or via web browser in heterogeneous environments.


• Maximized application uptime – SnapServer SAN S2000 ensures that essential applications are available at all times by supporting active-active mirroring and failover, and is fully compatible with the Windows Multi-Path I/O (MPIO) framework; also supports Microsoft Cluster Server.


• Disaster recovery – The inclusion of a VSS provider (Volume Shadow Copy Services)supports business continuity in the event of a disaster and increases backup efficiency while ensuring application consistency during backup and replication. It also enables SnapServer SAN S2000 to handle up to hundreds of thousands of replication recovery points.


• Twelve drives expandable to 120TB – The SnapServer SAN S2000 is a 2U base system that can seamlessly be expanded up to 120TB utilizing SnapServer E2000 expansion units.

“The SnapServer line has always been known for delivering rock-solid, reliable products for IT departments that need effortless and cost-effective storage solutions.

The SnapServer SAN S2000 not only builds on this reputation, but actually brings a new level of innovation and sophistication to the product line,” said Eric Kelly, president and CEO, Overland Storage. “We remain completely focused on listening to and addressing the specific storage needs of businesses by offering storage solutions that can quickly and easily be deployed within existing environments for instant scalability and reliability. Overland strives to deliver storage solutions that are truly effortless for businesses of any size.”

NetApp acquires data deduplication specialist Data Domain for $1.5 billion

NetApp Inc. today made a bold move to become the market leader in data deduplication technology when it acquired Data Domain Inc. for $1.5 billion in a mixed cash and stock transaction.

The deal is expected to close within 60 to 120 days. NetApp paid $25 per share – a high price considering Data Domain's shares opened at $17.40 today – but it acquired the company generally considered the leader in one of the hottest technology markets.

Jay Kidd, NetApp's chief marketing officer, said buying Data Domain would allow NetApp to compete in network-attached storage (NAS)-based disk-based backup, as opposed to the virtual tape library (VTL) space where it offers deduplication with NetApp NearStore VTL. Currently, the virtual tape library is NetApp's only backup hardware product offering with deduplication, and the deduplication it offers with its filers isn't optimized for highly sequential backup workloads, Kidd said.

On a conference call with press and analysts Wednesday night, Kidd emphasized that the NearStore VTL will stick around for those customers who are still interested in using tape, but "Data Domain will help us compete in an increasing number of installs wanting to minimize their reliance on tape," he said.

However, analysts are skeptical about the idea that NearStore will coexist alongside Data Domain's offerings. Data Domain's focus is on disk-as-disk without the VTL interface, but it does offer a virtual tape library appliance. That appliance doesn't integrate with back-end tape, which NearStore does, but NearStore doesn't do replication with dedupe, while Data Domain offers replication with dedupe.

"You could add back-end tape integration to Data Domain pretty easily from what I've seen," said data backup expert W. Curtis Preston. "It wouldn't be as easy to add replication to the NetApp product."

Arun Taneja, founder and consulting analyst at Hopkinton, Mass.-based Taneja Group, also pointed out that Data Domain's variable-length segment dedupe algorithm for backups is generally considered stronger than NetApp's NearStore block-level approach.

"The current [NetApp] dedupe offering hasn't been anything to write home about," he said. "Variable chunks don't always look for duplicates at block boundaries, which means it'll pick up a single-character difference between files."

The price of the deal only amplified skepticism that the Data Domain products will remain relegated to one part of NetApp's business. "You have to believe there will be some product rationalization, where they choose the best [product] for primary [storage] and the best for secondary [storage]," said Brian Babineau, a senior analyst at Milford, Mass.-based Enterprise Strategy Group.

NetApp tried to downplay the overlap between Data Domain's offerings and its own, but both companies position deduplication products with a NAS interface for nearline storage and archival storage, albeit with different approaches to dedupe. NetApp's dedupe for nearline storage is post-process, while Data Domain's operates inline.

NetApp officials on Wednesday night's earnings call said NetApp tends to be strongest in nearline and archiving deals where the primary storage is also a NetApp device because customers can incorporate NetApp's native data replication and migration tools. Kidd said NetApp intends to use Data Domain's nearline product to compete in mixed-vendor primary storage environments.

There's no overlap on dedupe for primary data -- Data Domain has stayed away from that and concentrated on backup and archiving. Analysts are split on whether NetApp will try to use Data Domain technology to enhance its primary dedupe. "I think you could see the [NetApp] dedupe enhanced with the Data Domain algorithm," said Dave Russell, a vice president with Gartner Research. "I just don't see spending that kind of money without really trying to get the value out of dedupe technology across the portfolio."

Countered Preston: "With this acquisition NetApp becomes the first company I'm aware of that has both a solidly inline and a solidly post-process dedupe product, and they are totally different beasts."

NetApp's dedupe works for primary storage because it analyzes only changed blocks in an environment where dedupe ratios are much lower than in the backup world. As a post-process offering, it doesn't sit in the data path or interfere with performance during production hours. Data Domain's product is optimized for high deduplication ratios on highly repetitive data and sits in the data path.

Preston also pointed out that Data Domain's licensing doesn't necessarily make its software a good fit for archiving. "From a pricing perspective, [NetApp deduplication] is probably much stronger for nearline storage," he said. "Data Domain's licensing is based on very high deduplication ratios and might be much more expensive gigabyte-for-gigabyte with a lower ratio."

Meanwhile, according to Taneja, this deal raises the likelihood of further consolidation in the dedupe space. "I believe that at some point in time [NetApp rival] EMC [Corp.] is going to have to buy [deduplication partner] Quantum [Corp.]," he said, "simply because deduplication technology is that important a competitive weapon now."