Neither Cisco Nor Oracle Want EMC

Cisco has no interest in buying EMC despite rumours to the contrary, CEO John Chambers says.

Cisco’s name had been floated around as a possible suitor after talks of a mega-merger between EMC and HP ground to halt, as reported by the WSJ earlier this week.

“If Joe and I were going to do something here we would have done it a year or two ago,” Chambers told people gathered for a breakfast Wednesday hosted by The Wall Street Journal. He was referring to EMC CEO Joe Tucci.

That’s not really surprising, though it would have been interesting if Cisco bought EMC. Although Cisco and EMC are close partners, EMCs subsidiary, VMware, has been threatening Cisco with a new technology called “software-defined networking,” a new way to build networks using software and cheaper hardware.

But Cisco is now in full competition mode with VMware. It spent about $US1 billion to build a competing product, launched in December, and Chambers vowed to crush VMware’s fledgling networking business and steal away all of its customers.

Oracle’s name was also floated as a possible buyer, but the company isn’t interested, sources told Re/code. That’s not at all surprising either. Oracle has been struggling for years to digest the last sprawling hardware company it bought, Sun Microsystems.

Oracle is now focused on building a cloud business. So buying the world’s biggest maker of storage hardware doesn’t fit into that, even if it that purchase did include VMware, a significant player in the cloud world.

HP reportedly wanted EMC mostly to lay its hands on VMware, and wanted to pay market price for EMC. But EMC wanted a premium price and the talks broke down from there, Re/code’s Arik Hesseldahl reports.

The deal between HP and EMC isn’t completely dead, sources told Barron’s. But we’ll see.

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