EMC is spinning off a company, but it’s not VMware

Key Speakers At The Oracle OpenWorld 2013 Conference
Joseph "Joe" Tucci, chief executive officer of EMC Corp., speaks during the Oracle OpenWorld 2013 conference in San Francisco on Sept. 24, 2013.
Photograph by David Paul Morris — Bloomberg via Getty Images

Three years ago, EMC (EMC) bought Syncplicity, which focused on selling file sharing and synchronization to businesses. Now it’s selling Syncplicity to Skyview Capital. No financial terms were disclosed but EMC will retain an undisclosed stake in the company.

Products like Syncplicity, Box, Dropbox, Egnyte etc. let users store their documents in the cloud, collaborate on them and sync all their changes. Syncplicity claims its differentiator is it allows users to keep sensitive information local while other, less strategic information can go to the cloud.

The rationale behind the change of ownership that is that Syncplicity can probably do better outside of EMC than under its umbrella. “We can partner with other hardware companies and service providers that might not have wanted to deal with an EMC-owned entity,” Skyview’s Jon Huberman, who will be CEO of the new venture, told Fortune.

The news will likely not hearten Elliott Management, the activist investor that’s been pushing EMC CEO Joe Tucci to sell its stake in VMware, but it does signal something of a pull back from EMC from at least one non-core business. The whole area of business-focused cloud-based file sync is something of a bloodbath.

One problem is that there are so many free or near-free offerings, that converting freeloaders into paying customers is really tough. Add to scrum Microsoft (MSFT), which is pushing Office users into OneDrive while Google(GOOG) is doing the same with Google Apps users, you have to wonder who’s left. Amazon (AMZN) Web Services’ Zocalo is another entry. All of these players, startups and old-timers alike want to be the “Dropbox of the Enterprise.”

But it’s not like Dropbox itself intends to cede that market. The San Francisco company is undeniably the grand poohbah of this category because of its huge installed base of consumers. For the past three years, it has been pushing Dropbox for Business,which now claims 100,000 business accounts including Spotify, National Geographic and Zendesk.

Companies like Syncplicity, which claims such customers as Merck, the Associated Press and the Boston Red Sox, hope to pick off those corporate users by offering something that’s easy to use but more compatible with risk-averse IT departments.


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