Will win the EMC prize?

EMC Stock Soars After Investors Learn About Mega-Merger Talks With HP, Others

Excerpt:

For nearly a year, EMC and HP have been kicking the tires on a merger that would have created one the biggest enterprise tech companies on the planet — with over $130 billion in annual sales, according to the Wall Street Journal. For comparison, IBM is expected to do $98 billion in annual sales this year. Apparently, the talks have stalled because they couldn't agree to terms. Both companies were concerned they couldn't sell the deal as it was to shareholders, reports the WSJ. ... The WSJ said EMC was talking to Dell about a merger, which may have involved just selling parts of itself off. Dell is working hard to get a piece of EMC's enterprise storage business. This means that EMC is open to talks with others, too, with names like Oracle and Cisco being dropped to the WSJ and Barron's. Cisco would be interesting match with EMC. The two companies are close partners, but in recent years, EMC subsidiary VMware has been threatening Cisco with a new technology called "software-defined networking." SDN threatens Cisco's Cisco's $21 billion router/switch business with a new software-centric way to build networks. Everyone from Goldman Sachs to Facebook has jumped aboard the SDN bandwagon. Then again, HP, Cisco's main rival in the network industry, has been all-in on SDN. Owning EMC/VMware would be sweet for HP on that count. All this merger talk might amount to nothing, but EMC is at a crossroads. EMC's bread-and-butter technology, enterprise computer storage, is under attack from a whole slew of young new technologies that offer bigger, faster, and cheaper storage options — and from cloud computing.

Comment: HP has a disastrous record with acquisitions (detailed in the article). But this would be a merger - a stock swap. I think Oracle is a better match as Oracle has been somewhat moribund of late. So it could be good for Oracle. A dark horse is Seagate but Seagate's market capitalization is a fraction of EMC's. But it seems to me there is a natural synergy there.

New life for Solyndra site

Fremont Solyndra Factory Sold To Seagate For Fraction Of Original Price

AND

Seagate planning $180 million research facility at Fremont Solyndra site

Seagate: Aren't Hard Disks Dead?

Seagate: A Dividend Growth Stock To Buy For 6% Yield
Excerpt:

Seagate, as of the most recent dividend increase, pays $1.52 per share on an annualized basis. At the most recent close of $25.10, this represents a 6.05% yield. Further, the dividend has been growing at a fairly rapid clip. At the beginning of 2012, Seagate paid $1.25/share on an annualized basis. Of course, management saw fit to increase the dividend earlier this year to $1.28/share annualized. And, on 11/29, Seagate once again announced another dividend hike to today's $1.52 annualized. This is some very high-powered dividend growth.

Comment: I bought STX back in March. My son and my nieces's husband work there. More on the "Aren't Hard Disks Dead?"

While solid state drives/NAND flash will certainly take the client market by storm with their speed and power-efficiency, for every gigabyte of "bulk" storage that disappears from the actual devices, a gigabyte on a cloud server somewhere needs to be there for the device. That gigabyte probably resides on a hard disk.

Hard disk drives are incredibly cheap on a per-gigabyte basis. While hard disk drives typically cost $0.03 - $0.05 per gigabyte, solid state drives will run from $0.50 - $1.00 per gigabyte. Clearly for a large database or web-server, going pure solid state is not economically viable. Having the two work in tandem - with the hard disk holding the data and a flash solution acting as a cache - is the solution that seems to be working now and what will be working for the foreseeable future.

In the client space, while pure SSDs are certainly gaining traction, the more likely mainstream solution is what we are seeing on many Ultrabooks: hybrid solutions. These solutions either consist of a discrete, usually small solid state drive paired with a large hard disk drive or a hybrid drive that contains both NAND flash built into the same package as the magnetic disk platters. The hybrid solutions are fast and give nearly the same performance as the pure solid state drive products, making them an attractive option for those who want both speed and bulk storage without compromise.