Deal expected to move e-mail archivist beyond Exchange

Veritas will likely broaden KVS' e-mail archiving capabilities beyond Microsoft's Exchange platform, according to one analyst who spoke after this week's acquisition announcement.

Regulatory requirements and the need for IT administrators to find better ways to manage and store e-mail messages have already put message archiving on top of their to-do lists.

Veritas Software Corp., Mountain View, Calif., is seeking to capitalize on this interest with this week's announced plan to acquire Exchange archiving specialist KVault Software (KVS) Ltd. for $225 million in cash. The deal is expected to close in September.

The acquisition may give the biggest enterprises reason to choose U.K.-based KVS. Today, KVS has

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about 900 customers and about $23 million in annual revenues. By comparison, Veritas' annual revenues last year were $1.75 billion.

"Veritas has been around for a long time, so for the largest companies, this may alleviate any concern about KVS as a standalone company," said Bill North, director of software storage research at International Data Corp., a Framingham, Mass.-based market research firm.

North said he expects that Veritas will eventually broaden KVS's capabilities beyond the Exchange platform.

IT administrators are challenged to look for ways to help end users groom their incoming messages. KVS not only archives e-mail, but also unstructured data, which includes files -- such as e-mail messages -- on a file server that is not specifically a database, North said. One of the essential features of e-mail archiving for compliance purposes is the ability to retrieve data by context or by content.

The company is considered a market leader, competing with the likes of EMC Corp. and IBM, North said.

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