EMC Wants R-E-S-P-E-C-T - BusinessWeek

Excerpt from an EMC reality check

EMC executives say that outsiders fail to grasp the magnitude of the company's turnaround. EMC flew high during the 1990s, when it became synonymous with the Internet build-out and ended the decade as the New York Stock Exchange's best performer. Then it crashed hard following the dot-com bust, as corporate tech buyers turned away from the company's pricey, specialized storage system. EMC looked like it was heading toward an ugly, drawn-out demise.

Thanks to dozens of acquisitions over the past few years, EMC has undergone a radical, if quiet, transformation. Where it once relied on a single hardware product—the Symmetrix storage array, essentially a black cabinet full of hard drives—for more than 80 percent of its sales, EMC now gets about 60 percent of its revenue from software and services, estimates Toni Sacconaghi, an analyst with Sanford C. Bernstein. This shift has occurred under the stewardship of Joseph M. Tucci, EMC's chief executive officer, who has set the company's sights on the booming market for cloud computing. Despite the shift, EMC's share price has languished for much of Tucci's tenure. "There are times you get frustrated," Tucci says. "But who am I to second-guess the market?"

EMC Wants R-E-S-P-E-C-T - BusinessWeek