EMC To Acquire Pi Corporation

In a world of corporate acquisitions in information technology, there are those that eventually matter, and those that are just part of the landscape.

Everyone is free to come to their own conclusions regarding this particular acquisition by EMC, but I for one see this as signaling yet another shift in the technology landscape – one whose impact probably won’t be blatantly obvious for some time.

Let me share with you why I think this isn’t your everyday acquisition …

What Is This All About?

I need to spend a few paragraphs setting up some context here, so please indulge me …

First, you probably know EMC’s position (and my position) regarding the importance of information – we’re becoming an information society --  it’s the currency of the modern era.   And, unlike other societal transformations, it’s happening much faster – and with far more impact – than most people can imagine.

If you remember back to the IDC study from last March, they said we’d be the proud owners of six times as much information in just three short years.  What you might have missed was a key point – that something like 70-80% of all new information was going to be created by individuals, and not by organizations.

So, the first part of the landscape is that the vast majority of information is now being created by people like you and me.  That's a big shift, when you think about it.

Second, the question of “who owns information?” has not been settled in our society.  We have clear societal behaviors around things like property and money, but – when it comes to information ownership – we’re all struggling to figure out who owns what, and what the conventions might be.

The natural corollary is that – if the vast majority of information is being created by people like you and me – we’re going to want to have a decent level of control over “our” information.

• How and where it gets stored. 
   
• Making sure it’s there when we want it.
   
• Who gets to see it, and under what circumstances.
     
• Making sure that our information is presented in a manner and a context that we approve of.
   
• And, above all, preserved in the long term -- across all of life's events

Simply put, we’re going to want to manage our personal information.

Personal Information Management

I remember a time where personal information management was SideKick running in an extended DOS partition.  We had a handy place to store contacts, action items,  etc. in one handy place.  We had control over “our” information.  I also remember carrying around a PalmPilot for a while -- remember those?

But the world has moved on in a big way.  We now all have extended digital lives – both at work, and at home. 

• We create value by creating new information.

• We create value from adding our perspectives and our context to other people’s information.

• We create value by sharing with others.

And, in case you haven’t noticed, the lines between our work lives and our personal lives are blurring more every day. 

Embedded here is a key strategic assumption – while most of the discussion around information management has been in the context of corporations and organizations – the bet here is that the discussion will evolve into a new focus around us as individuals in the information society.

And, let me be clear, we’re all going to want to manage – and control – our digital lives.

Enter Pi Corporation

Pi stands for Personal Information (not the mathematical constant!). 

Although the appeal of naming your company after important mathematical ideas probably never occurred to EMC2 … ;-)

Founded by a veritable “who’s who” of the technology industry, they recognized the shift in information management priorities, and came up with a fascinating approach to the problem.

I think it's going to be hard to value this acquisition by most traditional standards.  Pi isn't shipping any products yet.  They didn’t have a ton of VC funding.  From what I can see, they were just a bunch of incredibly smart and successful people who thought that the world was changing, and they could play a key role.  I haven’t seen their stuff running yet, but I’m under the impression that it’s very, very cool.

I think they were right.

EMC’s New Cloud Infrastructure And Services Division

An important aspect of the press release is that Pi’s founder and CEO – Paul Maritz – will be President and GM of this new EMC division.

I’ve been dropping hints like crazy that something was up in this space, but I guess now it’s pretty obvious – we’re taking this shift in the industry very, very seriously.  This ain’t just PowerPoint talking here …

We’re saying that success in this new space will require a very different technology base – and a business model – very unlike other parts of the traditional IT landscape.

The visible parts of this new entity include Pi’s assets, as well as Mozy and the Fortress platform … but I think it’s worth a tour through the rest of the EMC portfolio to see other synergistic aspects.

Context Matters

I’ve always thought that acquisitions have to work on a synergistic level – there has to be value from the context and the overall strategy.  And, to EMC’s credit, I’d offer that Joe Tucci and the team have done extremely well in this regard.

Who would have thought in 2003 that VMware would be a big deal?  Or that security was going to be a defining conversation, hence RSA?  Or that the future of corporate information management was changing, hence Documentum? 

Or, for that matter, any of the other several dozens of acquisitions EMC has made in recent years?

In my mind, there’s a compelling argument for Pi’s strategic importance in the overall context of EMC, even when just looking at the public announcements.

Did you notice EMC’s initial home offering for storage and information management, the EMC LifeLine software?

Do you think that some degree of security will be desired in this personal information management world, hence RSA?

Or, possibly, that the preferred consumption model will be as a service, using a cloud information management model?

Or, potentially, as our work lives and personal lives blur, that our personal content might need to be shared in very structured ways, using collaborative workflows, across traditional boundaries, hence Documentum?

I could go on, but I think I’ve made the point – it’s worth taking a look at the context to fully understand what’s going on here.

Like a diamond being set into a ring by an expert jeweler, Pi is potentially the centerpiece of a very intriguing strategic play.  And one that not too many people will initially appreciate, I believe.

To Paul and the rest of the stellar Pi team – between you and I, I think the fun has just begun …

So, What Is EMC Up To?

Given the public nature of this blog, there’s only so much I feel comfortable sharing at any point in time.  But, if you’re a careful reader, the strategic intent of this latest move shouldn’t be entirely surprising.

I think people are having a tough time putting EMC into a neat industry bucket.   

Our information infrastructure thinking spans multiple IT disciplines in a non-traditional – but inherently practical – manner.  If you’re looking at traditional models, we’re inherently frustrating.  But, if you can look ahead at how things might be in the future – well, it’s a different picture.

But, at the heart of it, EMC is all about information. 

And in a world where the majority of information is being created by individuals, we think what’s important is going to change.

We’ll see.

Comments

[Jonas]

So, is PI something like a hosted Chandler?

[Chuck Hollis]

Hi Jonas

Wasn't familiar with Chandler, so I popped over to www.chandlerproject.org to take a look around.

And the answer is, no, from what I could tell the Pi efforts go way beyond what the Chandler people are doing.

Hopefully, I'll be able to share more detail with everyone in the near future.

[Kevin K.]

Hi Chuck -

One very obvious thing comes to mind around all this cloud talk - It's a late 1990's flashback to things that execs from Sun and Oracle were talking about:

"The Network is the Computer."
"Thin clients"
"Ubiquitous information access"

My question is, do you think this is vastly different from those discussions or were McNealy and Ellison really on to something?

[Chuck Hollis]

Hi Kevin

I agree with you -- a lot of the conversation now is eerily familiar, isn't it?

But things are different now -- networks are vastly superior, people are more comfortable with using services rather than owning IT, and many of the supporting technologies didn't exist back then.

Simply put, I think this time around, it's gonna happen, whereas last time, it was a great idea that didn't go anywhere.

Thanks for commenting!

[Dan Keldsen]

McNealy and Ellison were definitely on something, whoops, you said "on TO something" Kevin... :)

As Chuck mentions, quite a bit has changed, look what networking speed (aside from cable failures in the ocean this year) has done to "flatten" the world and broaden technology outsourcing.

Lightweight interfaces and more "interactive" interfaces (AJAX-powered for example) have also had a major impact from the Net PC era - which was still fairly heavy on the client side (big Java apps if nothing else).

And of course the rise of SaaS models and distributed infrastructure that can actually deliver the goods in the end.

So all told, this is an overnight success, that began some 10 years ago!

[Terry]

After reviewing the Pi and the piWorx websites it looks like a Salesforce.com for consumers.

When will a product from EMC/Pi be offered?

[Chuck Hollis]

I suppose that's one way to describe it ... ;-)

To be honest, I don't really know when they're planning to have a consumer offering. That means it's probably not imminent, as I certainly would have heard something about it.

I want to use it too ....

[Terry]

But you are working on something Salesforce.com like with SAP?
http://www.reuters.com/articlePrint?articleId=USN1336031320080213

EMC still has some products that still has not been released. I am assuming this will be the infrastructure for the "EMC CLOUD".
http://www.reuters.com/articlePrint?articleId=USN1336031320080213

[Chuck Hollis]

Hi Terry -- I can't offer specifics around unannounced offerings, that'd be not-so-good for my blogging career at EMC, right?

[Counsel]

I don't mind a distributed model so long as the computer on my desk is a computer and not a thin-client. The iPhone has changed from a thin-client phone to something more like a smartphone (if the applications can be stored on and run on the phone--not to mention the data required by the application).

My concern is that many parties are now charging per volume/amount of data you access (ISPs), limit the data based on your tier of purchase from them, and/or think their network is enough to preclude funds leaving.

AOL learned the hard way that easy and community were not enough to guarantee continued participation. Of course, AOL could have done things much differently and had a different outcome (as could have compuserve, Delphi, et. al.).

Competition will, eventually, remove the limits based on usage for the end-user. Ad revenues and site visits that drive advertising revenue depend on site visits, and site visits will decrease if end-users are required to pay for every kb they download.

I'll have to wait to see how EMC delivers. As with any technology, the delivery of any underlying technology, however exciting, means more to uptake than the technology itself.