Legato: A Familiar Face

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Christus Health's Evelyn Briggs says Legato's future bears watching, but she's not ready to dump the software.

Legato Systems
2350 W. El Camino Real, Mountain View, CA 94040
(650) 210-7000
Ticker: LGTO
Exchange: Nasdaq
Employees: 1,500

David B. Wright
Became Legato's top executive in 2000 and chairman in 2001. Previously, he was CEO of Amdahl Corp. and spent 11 years at IBM. David L. Beamer
Executive VP, Chief Operating Officer
Responsible for marketing and sales. Before joining Legato in 2001, was president and COO of FileTek Corp. Before that, he was with Amdahl and IBM. Products

DiskXtender, including versions for Windows NT, Windows 2000, Unix and Linux. Application- and platform- specific versions for Oracle database and EMC's Centera storage devices. Storage management products include ArchiveXtender for archiving, SANXtender for SAN management and VideoXtender for managing data from video servers.

Legato Systems is like the small, friendly, locally owned hardware store. Everybody loves it. Everybody shops there. Until Wal-Mart moves into town. Then it's "See you later."

Legato has built a loyal base of customers who value the software's ability to work across multiple hardware platforms. Yet Legato increasingly faces stiff competition. The result: It lost $229 million on revenues of $262 million in 2002, though it narrowed its losses for the first three months of 2003.

Clouding its future is the rumor that Legato is an acquisition target. (Legato would not comment on reports that the company is for sale.)

These developments, in turn, are causing some customers to question Legato's long-term viability. "Rumors that Legato is an acquisition target do concern us," says Evelyn Briggs of healthcare provider Christus Health, which uses Legato's DiskXtender storage management tool and other Legato products to store and manage radiology images in 40 facilities. "We'll have to continue to monitor the situation. We don't plan to change, but that all depends on what happens."

In shopping for a storage and media management product, Briggs is considering either Legato or Hewlett-Packard.

Florida's Collier County Commissioner's Office, for one, has switched from Legato to Veritas. Bob Sanders, the county's systems manager, says Veritas' storage management tools can handle the movement of storage between storage-area networks, network-attached storage and tape running on a wide variety of operating systems.

Not all Legato customers are ready to cut and run. A core group—many of them local government agencies that need to manage mountains of documents—are sticking with Legato. Why? The products solve real problems and, compared with similar offerings from larger vendors like IBM, are reasonably priced.

The county of San Diego, Calif., uses Legato to store, manage and post 20 terabytes' worth of documents filed with the county clerk, assessor and recorder. "DiskXtender is at the heart of the system," says Casey McGhee, the county's chief of systems. The county also uses Legato's Replicator tool to back up the data, which is growing by about two terabytes each year. "The value is so high for us that I keep expecting Legato to increase the license costs."

This article was originally published on 2003-07-01
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