Survey: Size Doesn't Matter

Large vendors looking to move into the storage networking arena should learn a lesson from Cisco Systems Inc. (Nasdaq: CSCO): Bang on the door loudly, or hardly anybody will even know you're out there.

The Fall 2003 Storage Networking Market Perception Study from Heavy Reading, the market research division of Light Reading, this publication's parent company – demonstrates that startups can make their way in the market fairly quickly (see Storage Networking Open to Small Fry). But the same report shows that established vendors looking to cross into storage networking have struggled to gain recognition in the market.

The exception seems to be Cisco, which was identified by potential customers as an established SAN vendor, though it is a relative newcomer in the space (see Cisco Still a Kid in Storage).

Ciena Corp. (Nasdaq: CIEN), Computer Associates International Inc. (CA) (NYSE: CA), Hewlett-Packard Co. (NYSE: HPQ), and Lucent Technologies Inc. (NYSE: LU) have yet to establish recognition as leading SAN and NAS vendors, despite their well-known brands in other markets. For instance, fewer than 60 percent of respondents in the SAN software categories identified CA as a key supplier, and less than half of all respondents familiar with SAN extension equipment named Lucent.

Buyers know Cisco because it burst into the market with great fanfare. It poured millions into Andiamo Systems for research and development, before purchasing the switch maker in August 2002 (see Cisco Buys Andiamo). It made no secret of its plans to take on Brocade Communications Systems Inc. (Nasdaq: BRCD) and McData Corp. (Nasdaq: MCDTA) in the Fibre Channel switch market, and CEO John Chambers has enough confidence in storage to declare that it will become a $1 billion market for Cisco (see Storage: A Cisco Billion Dollar Play).Other major vendors haven't made as much noise and apparently have failed to carry their reputations over into networked storage. Despite having one of the broadest storage networking portfolios, HP is much better known for its desktop PCs, servers, and printers. HP's storage networking market perception ratings place it more in the middle of the pack than at the top of the class. Overall, 63.2 percent of the respondents identified HP as a storage networking vendor – but only 6.3 percent mentioned it as a price leader, and just 7.6 percent cited it as a performance leader.

CA is among the world's largest software companies, billing itself as a "worldwide provider of solutions and services for the management of IT infrastructure, business information, and application development." That description doesn't exactly scream storage management. Yet CA sells software in all three networked storage categories – backup and recovery, SAN management, and storage resource management (SRM).

Nevertheless, CA gets little credit for market leadership among storage networking buyers. It was recognized by about 60 percent of all respondents in those three storage software categories, but its perception as a leader was disappointing. In the SAN management software category, for instance, CA finished fifth overall in terms of recognition; and none of the respondents mentioned it as a leader in quality and reliability.

It also helps to chase the right market segment. While Lucent and Ciena compete in the SAN extension space, less than one-third of those who responded to the survey said they were familiar with any vendors in that category. Besides Cisco, ADVA AG Optical Networking (Frankfurt: ADV) placed ahead of Lucent and Ciena among price leaders in SAN extension.

Even though Lucent offers products in all three SAN extension categories – DWDM/CWDM, Sonet/SDH, and IP – it placed no higher than fourth place in any of the three. And while Ciena competes in two of these categories, it was recognized by only 38.7 percent of survey respondents in DWDM/CWDM, and by only 27.7 percent in Sonet/SDH.— Dave Raffo, Senior Editor, Byte and Switch