The acquisition has a greater potential than one might think

Dec 16, 2014 08:38 GMT  ·  By

Company takeovers happen all the time in the world, since the economy is largely capitalistic and when one large corporation needs some resource or knowledge bit, the easiest way to get it is to assimilate a group that already possesses it. Bonus points for experience.

This is about to happen between Western Digital and Skyera. Western Digital is one of the world's two major providers of storage devices and technology. Skyera is a young company, by comparison, focused on all-flash arrays.

Skyera was founded not too long ago by two key people at SandForce (a company that is owned by Seagate now, WD's big rival). Frankie Roohparvar, the former VP and GM of Micron's OEM NAND business, became Skyera's CEO earlier this year (2014).

The point we're trying to make is that Skyera is run by some of the people most knowledgeable in flash storage technology.

With Western Digital still being primarily a maker of hard disk drives instead of SSDs, that means that Skyera has a lot to provide its soon-to-be parent company.

Skyera's current activities

Skyera designs SSDs (which it calls blades) and has access to NAND technology from Toshiba, SK Hynix, and Micron (all of them are Skyera investors).

It's unclear if the three will continue to grant Skyera the NAND access needed for operations to continue. Toshiba, at least, is a primary rival to WD, though lacking in sheer market share, unlike Seagate.

Still, if the buyout affects licensing deals, it shouldn't be too hard for Western Digital to negotiate new deals.

Even without the contracts, Skyera should still be able to increase the endurance of NAND-based storage devices (SSDs primarily, but also flash drives and hybrid drives).

Still, the NAND deals are the basis for most of Skyera's operations, so it and WD probably made sure the deals would persist before publishing the buyout plans. Being the kind of corporation that always has some expansion plans in progress, it would be strange for this to not be the case.

Western Digital's current position on the NAND Flash market

As one of the two major storage corporations, both on the consumer and on the business / industrial front, Western Digital has been actively maintaining its huge supply chain and client base. On the NAND segment alone, it bought three other companies before Skyera in the past 2 years alone: Virident, STEC and Velobit. All of them eclipsed by the acquisition of Hitachi (now HGST).

We'll be keeping an eye out for new and longer-lived SSDs, as well as hybrid storage units.

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