History 2005: Will Sun Shine for StorageTek?

Opinions are mixed about the duo’s future. It all depends on how you look at the topic. For instance: Sun Microsystems is best known for Solaris and Java, while StorageTek, no matter how you slice it, is a tape company. So what’s the connection?

But there is another perspective: with StorageTek, Sun is finally getting serious about being in storage.

The deal
Sun Microsystems initiated a definitive agreemet to acquire Storage Technology on June 2, 2005. Each SorageTek shareholder will receive $37 per share in cash. $37 is a premium of nearly 19% over the clos saction is expected to close by late summer or early 2005. If it is not concuded under sertain circumstances, StorageTek will have to pay Sun $133 million.

End of storage monument
Sold to Sun, Storage Technology as we’ve known it will disappear, something that will not occur without some sentiment, bittersweet or even disappointed, on the part of those who have passed through, since it was the oldest of the storage companies, along with IBM, and the only one still independent. All the others, such as Amdahl, Ampex, Burroughs, Control Data, Honeywell Bull, Memorex and Sperry Univac, from the golden era of IBM compatible products, have vanished.

It was back on August 11, 1969 that 4 former IBM employees, Jesse Aweida, Juan Rodriguez, Thomas Kavanagh and Zoltan Herger got together in a small space above the Aristocrat Steak House in Boulder, CO to found a company called storage Devices, which they renamed a few months later as Storage Technology.

Among the initial investors, were Idanta Partners, a managing partner of which was David Dunn, a founder of Prime Computer and later chairman of Iomega.

The first CEO was Aweida, an Israeli immigrant of Palestinian descent, who took on his former employer, Big Blue, with an IBM plug-compatible reel-to-reel tape drive. The upstart continued to dog IBM, with tape cartridge-compatible products in the years to come, before releasing its own incompatible format of cartridges.

In the early 70s, StorageTek, as it later came to be known, introduced its first disk drive subsystem, equipped with 2 actuators to transfer data simultaneously. It’s brightest idea, however, wast represented in a famous pyramid depicting at the top, solid-state memories for high-speed access, then disks for fast access and finally tape for backup.

Following fruitless heavy investment in optical disc drives, the company filed for Chapter XI in 1984, from which it emerged 3 years later, thanks to the incredible success of its high-end tape cartridges libraries. A disk array for mainframes, Iceberg, was announced formally in January 1992, and would even be resold by its number one competitor, IBM. It will pain certain StorageTek veterans to see their sales team now reselling high-end disk arrays from HDS.

Some big names in the storage industry worked at STK before going on to create their own companies, including Juan Rodriguez (Exabyte, Datasonix, Ecrix), John McDonnell (founder of McData) and Jesse Aweida (Aweida Systems, Aspen Peripherals, Benchmark Tape Systems).

This article is an abstract of news published on issue 210 on July 2005 from the former paper version of Computer Data  Storage Newsletter.