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HP Beats Dell’s Offer for Storage Provider 3Par

Hewlett-Packard has made a $1.5 billion offer for data storage provider 3Par, a surprise move that beats out Dell’s offer of $1.13 billion for the same company last week. 3Par offers cloud-based data storage and virtualization services—it’s strictly in the realm of large corporations and sizable cloud computing services rather than products oriented towards consumers. However, the bidding war for the company shows how the larger computing industry is shifting its focus towards cloud computing.

HP is offering $24 per share for 3Par; HP argues that its offer is not only a boon to 3Par’s shareholders, but that HP as a company is better equipped to leverage 3Par’s business and technology. Right now, HP’s cloud-based data storage and services business accounts for about and eighth of the company’s revenue.

PC makers Dell an HP’s interest in 3Par stems from a desire to diversify their businesses: although consumers know the companies primarily for PCs and notebook computers (and, in HP’s case, printing technologies), the companies also run mammoth enterprise operations, offering not only server hardware and infrastructure but also support and data management services to go along with them.

3Par’s technology is based on “thin provisioning,” in which storage capacity of available hardware is maximized through virtualization and discrete management systems, so customers essentially pay only for capacity they use, and can add storage capacity only as needed. The approach is more economical than merely adding bundles of storage capacity to server hardware on an ad hoc basis.

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