Year In Review: Disk-y Business

The good news is that storage costs continue to drop, with third quarter disk capacity shipments up 30.7% year over year. Meanwhile, vendor revenues have increased only 8.5%, meaning enterprises can buy morestorage for less money. The bad news is that information volumes are growing at a minimum rate of 59% annually, so that even with the cost per byte--giga, zetta, undecillion (1,000,000,000,000,000,000,000,000,000,000,000) – dropping rapidly--falling prices can't keep pace with increasing storage demands. According to Forrester Research, with 2011 IT budgets seeing more restrained growth--barely 7%--storage has become the poster child for doing more with less.

Against this backdrop of a world drowning in data, here are some highlights of what unfolded in the disk storage market in 2011, which is dominated by six vendors with more than 80% of the market.

The year started with the forecast that data was only growing at a paltry 50%-plus, with pure-play storage vendors like EMC and NetApp ruling the storage heap. According to Gartner, lots of users are still trying to buy the best-of-breed products from NetApp and EMC, and not from the servervendors like IBM and HP (or Dell and Oracle/Sun).

Market leader EMC grew its 2010 external disk revenue share 3% to 28%, almost double IBM's 14.4%. In January, EMC made its biggest product launch in its--or the storage industry's--history, with 41 new products, including its first significant foray into the SMB market and a complete refresh of its midrange Clariion storage area network (SAN) and Celerra network-attached storage (NAS) systems.

"What you're seeing today is EMC doubling down on its core franchise: storage. The technologies are changing, the use cases are changing, and the consumption models are changing," said EMC Chairman and CEO Joe Tucci at the New York event/webcast. "These new products and capabilities put us in an excellent position to capitalize on the major trends in the IT industry and place us squarely at the intersection of the biggest ones: cloud computing and big data."

In April, EMC expanded its Greenplum database appliance line with the High Capacity DCA (or, Data Computing Appliance), the High Performance DCA and the Data Integration Accelerator, as well as version 4.1 of Greenplum Database software. A month later, it beefed up its SMB (Iomega) storage portfolio, expanding beyond its largely SOHO base. In August, EMC replaced the Iomega top-end StorCenter ix12-300r with the StorCenter px12-350r Network Storage Array, with up to 36 Tbytes of storage for less than $10,500.

One of the big stories in 2011 was Dell's ongoing move away from being a storage reseller (EMC) to being a storage innovator, largely through acquisitions (such as EqualLogic, Compellent, Ocarina and Exanet). Although Dell's dissolution of its EMC relationship led to an overall storage revenue decline of 20%year to year in the second quarter of this year, the company is actively pursuing long-term profitability by expanding its own portfolio of storage solutions, which generated a 15% revenue increase in 2Q11. Currently the company's intellectual property generates about $2 billion in revenues, says Travis Vigil, executive director, Dell Storage, and it wants to grow storage to $4 billion to $5 billion in annual sales.

With storage capacity shipments outpacing revenue growth, all was not well in the storage vendor arena, noted TheInfoPro in its biannual report released in May. Both Cisco and Brocade were trending down in purchases for 2011. Symantec and Commvault were also facing challenges, and HP was another vendor that raised concerns, it said.

While Dell was reinventing itself through acquisitions, HP also leveraged its 3Par acquisition to beef up its storage portfolio. In addition to integrating the 3PAR Utility Storage across the company's Converged Infrastructure portfolio, it made three product announcements in March: the P4800 G2 SAN, which is built inside an HP BladeSystem c7000 enclosure; the HP D2D4324 Backup System; and the HP E5000 Messaging System for Microsoft Exchange Server 2010.

SMB storage was part of a June announcement from HP, an entry-level storage appliance that supports the VMware API for Array Integration, as well as the vCenter manager for server virtualization. Also announced that month was the HP EVA P6000 storage appliance, as well as storage hardware, software and services based on technology from recent acquisitions such as Left Hand Networks, IBRIX and 3Par. In August, it also beefed up its 3Par line with two models of the HP P10000 3PAR Storage Systems, the V400 and V800, optimized to run in IT-as-a-service environments.

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