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Veritas Nabs Ejasent: Page 2 of 3

At least one analyst thinks Veritas's latest acquisition is a response to similar buys by competitors such as EMC Corp. (NYSE: EMC), which purchased VMware, a maker of server virtualization software, in December (see EMC Gobbles VMware).

"It's a close response to EMC buying VMware, which I thought was partly a response to Veritas buying Precise and Jareva," says Arun Taneja of The Taneja Group. "Veritas and EMC are really smashing each other."

Both seem bent on making their storage wares part of the larger landscape of utility computing. Is the tack working for Veritas? "It's too early to know," says analyst Drew Brosseau of SG Cowen Securities. "We have to see how they execute." He says Veritas needs to provide a compelling reason why customers should buy system management from them and not from companies with longstanding presence in the market, such as Computer Associates International Inc. (CA) (NYSE: CA) and IBM Corp. (NYSE: IBM).

Veritas is undaunted by any hint that it's facing a competitive problem in moving from storage management to utility computing. "At the end of the day, the worth of IT is evaluated by whether applications are running," says Bob Maness, Veritas's senior director of product marketing. While storage management is part of that, its future lies in how well it can be integrated with application management in increasingly automated solutions.

In its favor, Veritas's strategic track record is solid. In the recently published Heavy Reading Fall 2003 Storage Networking Market Perception Study, the company ranked first in name recognition in a survey of 380 buyers and users of storage area network hardware and software (see A Moment of Veritas). Veritas also finished first in product performance and product quality and reliability.