IBM is buying Storwize, an Israeli start-up that does real-time data compression software that can reportedly cut physical storage requirements by up to 80%.

That facility in turn is supposed to lower the cost of making data available for analytics and other applications. It can scan more years of historical data from multiple sources without additional storage and compressing data in real-time is suppose to make it available up to four times faster for transaction workloads.

IBM didn't disclose terms but an Israeli press report put the price at $140 million.

Storwize, which has offices in Massachusetts, raised $40 million from Sequoia Capital, Bessemer Venture Partners, Tenaya Capital, Tamares Group and Tokyo Electron Device. The deal is supposed to close this quarter.

Storwize claims one hundred customers.

IBM says its patented Random Access Compression Engine (RACE) is "unique" in being able to compress primary data, or data that clients are actively using, regardless of type - anything from files to virtualization images to databases - in real-time while maintaining performance. It said other storage compression technologies only compress secondary or backup data.

By compressing primary data, Storwize users can store up to five times more data using the same amount of storage, prevent storage sprawl and lower power and cooling costs. "This is important now more than ever," IBM said, "as the world's data already vastly exceeds available storage space and enterprise demand for storage capacity worldwide is projected to grow at a compound annual growth rate of over 43% from 2008 to 2013, according to IDC."

Storwize's STN appliance will work with most people's NAS systems.