Exabyte has a merger and aquisitions firm, St. Charles Capital, looking at strategic business alternatives for the company. These are said to include a merger or an outright sale. Oh dear.

What can we infer?

Exabyte's VXA technology is not selling well enough. Notwithstanding its advantages in capacity and tape data robustness compared to LTO or DLT formats, or Sony's AIT, it is losing customers' hearts and minds and wallets to, I'd guess LTO. It doesn't help that Exabyte has a VXA Alliance or that VXA has a good roadmap, or that the company introduced a nice capacity-upgradeable tape drive.

It doesn't help that Exabyte sells LTO devices either.

We can deduce that there is a risk that VXA technology will not survive. The roadmap may lengthen or even cease.

We might also deduce that no other firm has come knocking on Exabyte's door looking to buy it. Being very crude we might picture this as a case of no other tape product vendor wanting to buy a unique tape format that appears to be losing out to LTO, or needing to buy an LTO channel.

There is consolidation going on in both the prime storage hardware device markets; disk and tape. Seagate has just bought Maxtor. Sun bought StorageTek. Quantum bought Certance. Quantum is completing its acquisition of ADIC.

Unlike in the disk market there is no consumer tape device market to grow. Consumers want to backup to disk. So, increasingly, do small and medium businesses.

Good luck Exabyte. You have great technology. Let's hope it gets appreciated.

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