External Disk Storage Market Dodges Recession Effects
Zigzagging Wall Street numbers may be giving investors
indigestion, the mortgage and credit card markets may be in tatters, and
the auto industry may be on the verge of collapse. But the IT disk storage
market keeps chugging along well into the black as if the macroeconomy were
Researcher IDC reported Dec. 5 in its Q3 2008 Worldwide Disk Storage Systems Quarterly Tracker that factory revenues posted solid growth of 8.8 percent year over year, totaling $4.9 billion in the quarter.
In the three-month period from July 1 to Sept. 30, the total disk storage systems market grew to $6.6 billion in revenues, up 1.1 percent from the same period a year ago. Total disk storage systems capacity shipped reached 2,170 petabytes-which represents whopping growth of 41.7 percent year over year.
EMC kept the lead it has had for more than
three years in the external disk storage systems market with 23.0 percent
revenue share in the third quarter. IBM and
Hewlett-Packard were second and third, respectively, with 12.7 percent and 12.5
Dell was fourth with 9.1 percent, and NetApp and Hitachi Data Systems finished fifth and sixth with 8.2 percent and 8.0 percent revenue shares, respectively.
Among the top five disk storage suppliers, EMC and NetApp posted the highest year-over-year revenue growth during 2Q08, with 16.2 percent and 13.8 percent growth, respectively. EMC's revenue growth rate was up about 3 percent from last quarter alone and has now posted 21 consecutive double-digit growth quarters.
Analysts: Disk Storage Growth Not Slowing Down
IT analysts are in agreement that disk storage purchasing isn't going to slow down anytime soon, largely because the total volume of data is increasing at a 50 to 70 percent yearly rate.
"We expect that the storage sector, particularly external storage, will continue doing well compared to other segments of the market," Natalya Yezhkova, research manager in storage systems at IDC, told me.
"There are strong drivers for the market growth; besides all the usual suspects [e-mail, databases, files, etc.], there are growing segments of data protection, data archive and fixed content [videos, digital photos, etc.] that will continue boosting demand for storage capacity."
IDC's surveys have indicated that storage is one of the last categories in which end users will cut spending as needed, Yezhkova said.
"The only caveat to this: Users might start to invest more-not just in raw capacity, but on tools that would help to maximize storage utilization [e.g., thin provisioning, data deduplication and storage virtualization]," Yezhkova said.
However, Yezhkova said that "at the same time, current market conditions and tightening budgets are leading to longer purchasing cycles for storage systems and to the adoption of technologies designed to optimize storage utilization and/or reduce total cost of ownership."
Other Elements of the Q3 Report
IDC also said that the open-standards SAN (storage-area network) market grew a healthy 14 percent year over year, with segment leader EMC taking an even 25 percent revenue share. Next was HP with 14.7 percent.
The NAS (network-attached storage) market grew 19.7 percent, led again by EMC with 37.7 percent revenue share and followed by NetApp with 28.2 percent share.
Virtualization continues to drive sales of new disk storage. Thus, the iSCSI SAN market continues to show strong momentum, posting a huge 96.7 percent revenue growth compared with the 2007 quarter. Dell is the leader in that market with 31.1 percent revenue share, followed by EMC and NetApp, with 13.3 percent and 12.5 percent share, respectively.
"The midrange market [systems in the $15,000-$299,999 price range] was particularly strong in the third quarter, growing 15 percent year over year," said IDC storage research analyst Liz Conner, who handled the research along with Yezhkova.
"IP storage played a major part in this growth fueled by the strong adoption of iSCSI SANs, specifically within virtualized server environments, as well as solid growth in NAS-based solutions, addressing the ever-increasing growth in file-level data."