OCZ Grows Up, Signs Definitive Agreement to Acquire Indilinx
by Anand Lal Shimpi on March 14, 2011 9:05 PM EST- Posted in
- IT Computing
- Storage
- SSDs
- OCZ
We first met Indilinx in early 2009, with its Barefoot controller at the heart of OCZ's Vertex SSD. Until SandForce showed up in 2010 with the SF-1200/1500 series of controllers, the Indilinx Barefoot was the cheaper alternative to Intel. If it wasn't for Indilinx I'm not sure Intel would've had any real competition until last year.
The OCZ/Indilinx relationship was always a close one, but it's about to get a lot closer. Today OCZ announced that it has signed a definitive agreement to acquire Indilinx Co., Ltd for ~$32M in OCZ shares. The deal is expected to close within 30 days.
Why would OCZ acquire Indilinx? To be honest, it's the only way to ensure growth in the future. While OCZ is currently the retail/channel face of SandForce, SF also happens to sell to all of OCZ's competitors. OCZ may get early access to SandForce hardware, but so could anyone else who shows up with a big enough check. Ultimately to stick around in this business OCZ needs to be able to build its own controller and that's what the Indilinx acquisition is designed to allow.
Indilinx was working on its first 6Gbps controller codenamed Jet Stream, however the design never surfaced. Delays do happen in chip design and I'm guessing Indilinx just couldn't make it happen with Jet Stream.
What does this mean for SSDs today? Probably very little. OCZ will continue to ship SandForce based drives, however at some point I'm expecting to see an exclusive OCZ branded controller. While this move will likely guarantee OCZ's ability to differentiate amongst its smaller competitors, I'm not entirely convinced it will be enough to compete with the likes of SandForce. We've even seen Intel struggle with that battle.
Anything can happen though. Two years ago I didn't expect anyone other than Intel to dominate SSDs. A year ago it was SandForce. By this time next year anything could happen.
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clahman - Tuesday, March 15, 2011 - link
i think they porbably meant that.i saw " who shows up with a big enough check
Solidstate89 - Monday, March 14, 2011 - link
I hope they learned a lot about controllers from SandForce, because if they expect an Indilinx controller to be able to compete with the likes of Intel's, Marvel's and especially SandForce's next-gen controllers with their current lineup, they've got another thing coming.Shadowmaster625 - Tuesday, March 15, 2011 - link
All I know is that the Indilinx 30GB boot drives are very inexpensive and perform very well. The one in my 1.3GHz notebook makes it surf the web faster than my quad core desktop. If this move can help OCZ knock $5 off the cost of a boot drive then it is a smart move.landerf - Monday, March 14, 2011 - link
So... how come they didn't just buy sandforce? Seems like money better spent.Kaboose - Monday, March 14, 2011 - link
Sandforce wasnt for sale, nor was it going to be only $32Mlanderf - Monday, March 14, 2011 - link
You mean it wasn't for sale like up for sale or like they asked and sandforce said "no". Seems it'd be better to pay more for something useful than blow cash on a dead end.zipz0p - Monday, March 14, 2011 - link
I don't think Indillinix is a dead end. I suspect this will allow OCZ to really go hard for the higher-volume mid and lower performance drives, if the current controller hierarchy persists. This is a very interesting move which may position OCZ very well in the SSD landscape, in spite of their much smaller size compared with some of the other players.landerf - Tuesday, March 15, 2011 - link
Just seems to me that shelling out loads of money to play catchup could easily turn out unfavorably. I'm assuming the goal is to eventually either ditch dependence on SF for an internal only controller or ditch dependence on SF and displace them by selling controllers to your competitors. Either way good plan by itself, but I'm not sure buying a company that's already a generation behind was the right way to go.Anand Lal Shimpi - Tuesday, March 15, 2011 - link
The reality is that to buy SF would require more money than OCZ is worth at this point. SF is a very interesting acquisition target, but the company wants to go public so any acquisition price will be very high.Take care,
Anand
qrazi - Tuesday, March 15, 2011 - link
And wouldn't Indilinx bring a lot of experience with firmware inhouse with OCZ? From what I have understood from all SSD articles, firmware is where most differentiation can be made.So then it would also benefit OCZ SSD's with other controllers then Indilinx?