IDC: Storage Software Still Zippy

The rest of the storage industry may be taking its time to climb out of the hole, but the storage software market appears to be experiencing a full-blown rebound: Market analysis firm IDC released its Worldwide Quarterly Storage Software Tracker numbers today, showing that the global storage software market jumped 7.3 percent during the second quarter this year to $1.6 billion (see IDC: Storage Software Up 7.3% Q/Q).

Not impressed? Compared with the measly 0.9 percent growth the storage software market experienced from 2000 to 2001, its actually quite a feat (see IDC Sees Storage Software Boom).

And this is just the beginning, IDC claims. In July this year, the firm predicted that the storage software market would reach a whopping $13.6 billion by 2006.

Accelerated by a growing fear of disasters and an increasing emphasis on data protection, storage replication software showed the most sequential growth, leaping 8.5 percent compared to the first quarter of 2003, IDC says. Meanwhile, backup and archive software continued to make up the largest segment of the storage software market, growing 7.3 percent during the quarter.

“Backup, archive, and replication software will continue to grow as security becomes a bigger issue,” says Fred Broussard, one of the IDC analysts who worked on the report.As companies decide to prioritize securing their data, however, it would appear that they’re under-prioritizing other areas. On the other side of the spectrum, IDC reports that storage resource management (SRM) software lagged behind the overall market, only growing 6.1 percent quarter over quarter.

So who’s benefiting from all this growth? IDC says that the rank and file of leading storage software vendors has remained the same, with EMC Corp. (NYSE: EMC) securely in the lead with 26 percent share, followed by Veritas Software Corp. (Nasdaq: VRTS) (21 percent), Computer Associates International Inc. (CA) (NYSE: CA) (9 percent), IBM Corp. (NYSE: IBM) (9 percent), and finally Hewlett-Packard Co. (NYSE: HPQ) (7 percent).

Table 1: Top 5 Vendors, Worldwide Storage Software Revenue, Second Quarter 2003 (Revenues are in Millions)

While each of the top five vendors saw their share increase over the quarter, the report shows that some certainly gained more ground than others. Only the top vendor, EMC, and the last company on the list, HP, managed to increase their revenues in double-digit percentage-points, with 13.6 percent and 10 percent respectively (see IDC: EMC Widens Software Lead). CA’s revenues improved the least over the quarter, only growing 1.8 percent. The remaining market grew 2.2 percent during the quarter.

“We really outpaced not only the industry but certainly also the other major players,” says EMC spokesman Greg Eden. “Our strategy of providing both flexible, open software, as well as our platform-specific software, is bearing fruit.”— Eugénie Larson, Senior Editor, Byte and Switch