Sun has being OEM’ing FalconStor’s virtual tape library software since 2005, and last year said that the product will be the basis of a future Sun super-user’s VTL. replacing Sun’s cancelled in-house Open VSM project.

That is why Sun must have been reluctant and a little embarrassed to have inked a deal that will see it resell VTL software developed by privately-held Diligent Technologies. Having retracted its promise to create an Open Systems version of its mainframe VSM VTL, and then promoted to flagship status a FalconStor product that was originally only intended as a placeholder, Sun is now implicitly admitting that the FalconStor VTL does not actually meet all of its customers’ needs.

Like FalconStor’s software, Diligent’s ProtecTier VTL is pitched as a high-end product, and carries list prices starting at $35,000. Diligent announced the reselling deal with Sun yesterday. Although said that it is still committed to using the FalconStor product as the basis for its current VTL roadmap, it declined to explain why it needed to sign the Diligent deal.

FalconStor’s VTL software is OEM’ed by EMC and IBM as well as by Sun, and hugely dominates the still growing non-mainframe VTL market. In July FalconStor CEO boasted that the product is the fastest, biggest and smartest VTL in the enterprise space. By the fourth quarter last year over half of FalconStor’s revenue was coming from the sale of its VTL software, and since then the company has said that its VTL code has grown faster than any other of its major products.

Privately-held Diligent meanwhile says it has racked up just 200 VTL customers. But alongside market presence there is another obvious difference between Diligent and FalconStor’s VTL software, which is in their support for data de-duplication. Because it can hugely reduce the amount of disk space needed for backups, de-dupe is fast becoming a standard feature of disk-based backup products.

Diligent began shipping VTL with in-line de-dupe in 2005, but FalconStor does not appear to have had an easy time making the same doing so.

FalconStor first announced availability of de-dupe for its VTL last year, at which time it said the feature would ship immediately. But well into this year the company was still only shipping the de-dupe function to selected customers, and some sources were claiming that the code was very buggy.

Yesterday FalconStor did not respond to an email and phone calls asking how many end customers are now using its de-dupe feature, or how many of FalconStor’s OEM partners have qualified it.

The biggest of those partners are IBM Sun, and EMC. Sun yesterday would not say whether it has begun shipping FalconStor’s de-dupe software. IBM has already been reported to have complained about the reliability and performance of FalconStor’s de-dupe, and in May it told Computer Business Review that it had set high standards for performance to be specifically customized for the VTL customer base. By press time yesterday IBM had not responded to a Computer Business Review request for an update on that situation.

Also Back in May, Sun said it was not planning to ship the FalconStor de-dupe feature until the end of this year, and would not say why it was planning to wait until then. EMC has said that it will rely on its own, in-house de-duplication technology, courtesy of its purchase of start-up Avamar Technologies last year, although it has yet to say when exactly that will be integrated with its FalconStor-powered VTL. In the interim, it too has no plans to adopt FalconStor’s de-dupe code.