Cisco on Friday officially pulled the plug on a computer storage product called Invicta, acquired when it bought a startup called Whiptail in 2013 for $US450 million.
And we can imagine the folks at Cisco’s partner-turned-arch-rival EMC, getting a chuckle out of the situation.
The TL:DR version:
By shuttering Whiptail the day before new CEO Chuck Robbins officially takes ofice, Robbins has admited Cisco’s attempt to compete head-on with one-time partner EMC didn’t work. The question is, will he offer a bigger olive branch to repair that partnership?
Meaty details: Yes, Cisco is laying off the Whiptail staff
The official shuttering of Invicta confirmed an earlier report by Chris Mellor at The Register that Cisco had thrown in the towel and laid off nearly all of the Whiptail staff. We aren’t sure how many people were affected. (We found over 50 people on LinkedIn who had worked at Whiptail, but many of them had already moved on.)
Cisco confirmed a layoff did take place. A spokesperson told us:
Yes, there are some positions that will be impacted as part of the Invicta EoL [end of life]. Cisco’s leaders do what it takes to execute on our strategy — to be the best at solving our customers’ challenges. That will include making quick, targeted decisions to invest for growth and manage our business portfolio.
Cisco’s acquistion of Whiptail was a slap in the face at EMC
Whiptail made a flash storage product that competed head-to-head with EMC’s line of flash storage. Flash storage is when data center computer servers use the same super-fast storage used by smartphones, tablets and thumb drives.
Cisco and EMC were once close partners, and had a very successful joint business together where they sold Cisco’s UCS computer servers blended with EMC’s storage and software from EMC’s subsidiary VMware.
But then the two partners began to compete. Things got especially tense after VMware bought a startup that had invented a hot new network technology that promised to eat Cisco’s lunch Nicira. Cisco was also trying to buy Niciria when VMware outbid it, sources close to the companies told Business Insider.
The companies’ relationship devolved until the two divorced, with EMC buying out most of Cisco’s stake in VCE. Cisco, in turn bought Whiptail to try to take on EMC on EMC’s own turf.
At the time Cisco bought Whiptail, flash enterprise storage startups were quickly being gobbled up for huge sums of money by other big players. So Cisco quickly grabbed Whiptail.
The Whiptail technology had a lot of problems
The Invicta product had been plagued by issues almost from the get-go. In September, 2014, Cisco haulted shipments of Invicta because of “quality” issues, according to a CRN report.
Also in September, the CEO leading Whiptail when Cisco bought it, Daniel Crain, left Cisco.
By the spring of 2015, Whiptail’s co-founder, James Candelaria, who had became director of engineering at Cisco, left the company to launch his own consulting company.
A month later, the guy running the UCS line and responsible for the Whiptail unit, Paul Perez, left to join Dell as CTO.
Fast forward to Friday, when Cisco formally killed the Invicta product, announcing to customers it would no longer sell it.
Cisco now says it will work with its storage partners to provide flash storage with its UCS computer servers. Such partners include EMC and NetApp.
This could be an olive branch from brand-new CEO Robbins to EMC. We’ll see if Robbins follows it up with other moves designed to repair the relationship.
This is also the second business that Cisco shuttered the week before Robbins officially took over. Last week Cisco divested its huge televsion video control business, bought for $US6.9 billion in 2005, selling it for $US600 million.
Robbins clearly wants to quickly cut Cisco’s problems and get the company focused on its next big opportunity, the Internet of Things. That’s where billions of devices will join the internet.
Here’s what Cisco told us about why it shut down Invicta (bolded words added for emphasis):
While many customers’ Invicta installations are performing as intended, we recognised that the Invicta technology would not be able to change in a way that would be required to meet future market needs. Accordingly, we decided now was the right time to announce its End of Life. In doing so, we are able to continue investing in building world-class data center solutions via UCS product innovations, and will also offer market-leading flash storage solutions through our partner ecosystem.