Storage Highlights
- In Q1 2013 Disc drive market fell 6% to $12.6B due to strong price declines
- Storage systems declined 2% to $7.0B, although array shipments improved 2% to 2.0M
- In the year to end of March the disk drive market grew by 18% to $54.3B
- Storage systems fell 2% to $28.8B and array shipments fell 2% to 590k
- EMC leads the storage systems market with a 22.7% share from $6.5B revenues
- NetApp (14.1%), HP (12.0%) and IBM took the next 3 places
- A continued shift from large to small arrays and cheap storage in small servers
- Still no Big Data benefits despite constant references and scary info in vendor marketing
BYOD, Big Data, mobility – all are driving the marketing campaigns of storage suppliers, which aren’t complete without scary numbers of Tweets, Facebook messages, Spotify downloads and the like. But there’s no evidence that this brave new world is helping them succeed in the hardware market. In fact even the disk drive market experienced decline in Q1 2013. You’ll want to learn more about how things are going.
Few Signs Of Big Vendor Revenue Growth
EMC led the storage systems market in the year to the end of March achieving a 22.7% share and 1% growth from its $6.5B revenues: but this was the only growth among the to suppliers. NetApp in 2nd position was the best of the others – declining just 1% to $4.1B. HP (-10% at $3.5B), IBM (-7% at $3.4B), Dell (-14% at $1.5) and Fujitsu (-13% at $1.1) all worse.
There were mixed fortunes in the disk drive market as a result of acquisitions and the effects of the floods in Thailand a year before. Western Digital was the leader in the year to the end of March with a 30.2% share ($3.8B), followed by Seagate with 28.5% ($3.5B) who shipped 2.3M and 2.4M drives respectively. The consistent growth in unit shipments is evidence of the move to smaller arrays and informal storage systems.
Some Conclusions – No One Wants Big Arrays
For many years the large storage system suppliers built their strategies on building their own and acquired IP into complex big arrays. In 2013 this is no longer a route to success – the recession has cut the budget for big-ticket items, but – more importantly – shifts in workload are making these ‘legacy’ offerings far less relevant. For many systems of engagement require different economics for which smaller, less formal, storage systems. Evidence for this comes from the disk drive manufacturers who increase their shipments by 5% to 2.0 Million despite the fall in revenue. Flash storage will help the major vendors over time, although we currently estimate it to be only 3% of storage capacity deployed by Enterprise customers. So what should suppliers do? They should concentrate on selling rack and blade servers for the attachment of low-cost drives, while battling to become the trusted advisor for Big Data applications. Success will be measured in software and service revenues rather than in storage system revenues. They should also make sure they have the features necessary for client and server virtualisation (simplified management, thin provisioning, flash storage, etc.), but will continue to find this a crowded market. They should not give up on the big arrays however as the trend towards centralisation will make them relevant again once economic conditions improve in a year or so.
