In a dramatic move this morning, Dell announced the intention to purchase the innovative vendor of enterprise storage 3PAR for $1.15 billion in cash. If there were any doubts remaining about Dell’s commitment to be a force in the storage market alongside of EMC, IBM, HDS et al., this deal should put them to rest. Dell acquired the iSCSI storage array vendor EqualLogic in November of 2007, clustered NAS vendor Exanet in February of this year, and most recently they bought data deduplication vendor Ocarina this past July, as well as putting together a partnership with object storage vendor Caringo. Clearly these are a significant list of deals, but the strategy was incomplete without an enterprise class primary storage system of their own. 3PAR, whose products generally compete with high-end systems in terms of performance and availability, will give Dell the ammunition they need to go head-to-head with the big guys.

Dell has cultivated a relatively successful partnership with EMC for mid-range and enterprise storage for some years, but in spite of Dell’s claim to be invested in that relationship going forward, this deal clearly puts pressure on it. Initially, there is a gap between the SMB focused EqualLogic products and the high-end offerings from 3PAR, which will be filled by the Clariion products from EMC, but in the long run, Dell is likely to be motivated to move out of EMC’s shadow and build its storage brand on proprietary products based on these acquisitions.

This deal ends a good deal of speculation about who might buy 3PAR, with HP the main alternative suitor. HP now faces a build or buy decision as it continues to try to redefine itself in storage amidst a patchwork of the aging EVA platform, partner technology from Hitachi on the high-end, and acquisitions in iSCSI and clustered file storage, but no clearly defined long term vision or anchor technology.