IBM, in some ways, is like a beloved grandfather: graying, venerable, thoughtful and wise-someone experienced in life and business who has earned admiration and respect.
What a family doesn’t expect to see is Gramps suddenly going wild, jumping up on the town square soapbox with a megaphone, yelling, “Hah! Look at me! I’m the king of the world!” and blabbing on and on about how great he is.
Shamefully, that’s pretty much what Big Blue did earlier this week. As a PR stunt-and I’ve seen many dubious ones in my 30-year career-this one fell in a million pieces from the sky, like a clay pigeon in a skeet-shooting event.
On the morning of June 4, reporters and analysts phoned in to a special conference call featuring IBM’s Andy Monshaw, general manager of system storage. Concalls like this-especially on a busy Monday-are normally reserved for legitimate news announcements, such as new products, mergers and acquisitions, lawsuits, or management changes.
Press conferences are not usually called to crow over a single market research report. Especially when: a) there are a gaggle of market research reports released every week, and b) everybody knows how the information in these reports can be manipulated for best perception, per company agenda.
If lying is the worst kind of public relations, bragging is No. 2. But, torpedoes be damned, IBM was going to have its say on a big telephonic stage. Totally out of character for the company. Who’s calling the PR shots there now, anyway?
Monshaw then proceeded to declare IBM the Number One Company in the Universe as far as all spinning disk and tape storage hardware is concerned, because Dave Reinsel-certainly a respected analyst-and his IDC research team said so.
In a first-time report that lumped together total disk and tape storage hardware numbers for 2006, IDC said IBM earned 22.2 percent of the combined revenue ($28.6 billion) over HP’s 20.9 percent and EMC’s 13.2 percent.
“IDC has announced that IBM is now the number one trusted storage hardware vendor in the world,” Monshaw said. “That’s internal disk, external disk and tape. It’s the way customers view their storage requirements.
“There’s lots of competitors that look at niche portions of this, but when you talk to a CIO, he wants to know about how to store, manage and exploit his data in a secure way, and the only vendor that is able to bring all those capabilities to the table is IBM.”
That, certainly, is debatable.
Blowing Big Blue Smoke?
Several analysts with whom eWEEK spoke after the call also were not too impressed. The general response was that IBM was just blowing smoke.
IDC’s report took in all spinning-disk servers with three or more drives, as IDC’s taxonomy requires, Reinsel said. However, the report didn’t differentiate between internal and external disk storage, which are very different play areas for IBM’s various competitors.
EMC, for example, makes external storage arrays (where it is a dominant No. 1 in the world), doesn’t make internal storage and doesn’t focus much on tape storage. HP makes all of the above and is the only company in any way similar to IBM in producing all-around branded storage hardware.
All the other companies have their specialties.
“You know we are not a server vendor,” said EMC spokesperson Todd Cadley. “Funny how they leave that out. This initial data came out from IDC’s IDC Worldwide Quarterly Disk Storage Systems Tracker, March 2007. Pretty much, they are trying to recycle old news.”
Following IDC’s quarterly storage numbers (released June 7), HP spokesperson Danny Miller had a few choice words.
“Given IBM’s bombastic press conference about the company’s performance in the storage market this past Monday, it is worth noting that HP overtook IBM in a number of categories [in the IDC quarterly report]; their boasting was a bit premature,” Miller said. “It’s also worth comparing the two companies’ most recent quarterly earnings announcements: HP’s storage revenue grew 1 percent; IBM’s declined by 1 percent.”
Other observers had their own reactions.
“‘The more things change, the more they stay the same’ seems to be the motto of the storage market, as far as storage revenues market is concerned,” said David Hill, principal analyst with The Mesabi Group.
For worldwide combined disk and branded tape storage revenue, IBM remained in overall first place, albeit with a minuscule decline in market share, according to IDC. HP fell a single percentage point in market share but remained in second place with more than 20 percent of the market.
“EMC, which focuses on disk rather than tape, remained in third place and gained nearly a percentage point of market share. Overall, then, there does not seem to be any major momentum shift in the overall disk and branded tape storage revenue market share, based upon IDC results,” Hill told eWEEK.
Cherry-Picking the Data?
Donna Taylor, principal research analyst of storage markets at Gartner, told eWEEK that “it’s a difficult comparison in some respects, because they [IDC] are supposedly looking at total storage hardware [including tape]; thus, it’s an apples-to-oranges comparison.”
Gartner’s Storage QStats specifically tracks the ECB (external controller-based) disk array market, Taylor said.
“Included in our data is JBOD [just a bunch of disks], although not the focus,” Taylor said. “As you know, tape and JBOD revenue can provide a vendor with a reliable revenue stream, depending on a vendor’s strengths and acquisitions, etc. Therefore, by carving out one and adding another, you can dramatically alter the landscape/marketshare.”
A statement IBM made regarding beating out EMC in the fourth quarter of 2006 disk sales is puzzling, Taylor said. “Our data shows that not to be the case. Furthermore, the numbers weren’t even close. EMC consistently outpaces its closest competitors [whether IBM or HP] by a sizable margin,” she told eWEEK.
“As I look at the charts, it’s obvious that they’re cherry-picking the data from IDC and Gartner … we no longer track tape quantitatively, so I’ll not comment on their overall total numbers,” Taylor said.
IDC’s Reinsel told eWEEK that “customers had been asking us to do a combined market survey [total disk and tape] for quite some time, to show overall storage leadership. That’s why we combined [the different categories].”
IBM says that customers see the storage world in terms of internal disks, external disks and tape. That may or may not be true, depending upon the customer.
More importantly, for marketing purposes, that’s the way Big Blue itself wants to see it.