EMC Slides Down Poll

Another day, another piece of bad news for EMC Corp. (NYSE: EMC).

Trauma du jour: EMC has lost its lead in "user satisfaction" to the new kid on the block, Hitachi Data Systems (HDS), according to a survey out today from Wit Soundview. Pricing appears to have been the companys downfall, the report says.

Wit Soundview conducted the survey of 350 companies at the Gartner/Dataqueststorage conference last month. Of the 64 valid responses, mainly from financial and government institutions, the brokerage firm found that EMC’s low ranking was due to its policy of pricing substantially above its competition. (The text of the survey is available at http://www.hds.com/pdf/WIT2001survey.pdf.)

Since then, the storage giant has slashed its prices in an effort to win back mindshare (and marketshare). But “this won’t cure the whole problem," says Gary Helmig, analyst with Wit Soundview. “Users are looking for an alternative to keep EMC honest.

“The intriguing thing is how far HDS has moved up the survey,” he adds. No fewer than 100 percent of respondents said their view of Hitachi had improved over the year. “They have a leading product and clearly people are recognizing it."Naturally, EMC questions the figures, refusing to cede an angry inch to Helmig. “People should be very careful with this document. Only 64 responses raises serious questions about the validity of the survey,” says Michael O’Malley, corporate communications spokesperson at EMC. Wit Soundview concedes that many of Gartner’s clients -- which would also be EMC customers -- did not attend the show. That said, Helmig believes the results are a good indication of the market’s current view of EMC.

O’Malley points out that EMC does its own internal survey on thousands of its customers and -- prepare for a shocker -- it consistently rates above 95 percent on the satisfaction scale. “This survey doesn’t jibe with our numbers at all,” he says.

Hitachi wasn't the only company to beat out EMC in user satisfaction in the Wit Soundview survey. Veritas Software Corp. (Nasdaq: VRTS), StorageTek (NYSE: STK), Compaq Computer Corp. (NYSE: CPQ), Sun Microsystems Inc. (Nasdaq: SUNW), and IBM Corp. (NYSE: IBM) also came in ahead of it. Conversely, Legato Systems Inc. (Nasdaq: LGTO), Computer Associates International (NYSE: CA), Quantum Corp. (NYSE: DSS), and Hewlett-Packard Co. (NYSE: HWP) brought up the rear behind EMC.

The results weren’t all doom and gloom for EMC however. Approximately 32 percent of the users surveyed said EMC would be their top choice for supplying virtualization software; 26 percent ticked EMC as their second choice. This puts EMC in the lead with the greatest virtualization mind-share, the survey states.

“It’s a bit strange, as they have been rather quiet in this area,” says Helmig (see Virtual Reality?). “[However] EMC’s lead in storage will give it an advantage on delivering new technologies like virtualization to users." Compaq and IBM have been more vocal about virtualization and came in close behind EMC.The report is obviously good news for HDS, which, as well as leading EMC in user satisfaction, is these days also rumored to be leading it in employee satisfaction (see EMC Hits New Lows ).

— Jo Maitland, Senior Editor, Byte and Switch http://www.byteandswitch.com