Storage Market Future Brightening Up

IDC has just released its numbers for the external disk storage systems factory revenues for the fourth quarter of 2009 (4Q09), showing a slight year-over-year decline of just less than 1  percent, to $5.3 billion.

The total disk storage systems market grew to $7.3 billion, representing flat growth from 4Q08 while total disk storage systems capacity shipped reach 3,304 petabytes, growing 33  percent year over year.

The previous quarter continued the trend of slipping sales, but the slide was less than in previous quarters, with IDC predicting better times ahead for storage vendors, especially EMC and NetApp (http://www.channelinsider.com/c/a/Storage/Disk-Storage-Sales-Strengthen-242020/). North America turned in a better performance in Q3, with sales dropping 5.5  percent while EMEA fell 11  percent, and APAC and Japan were down 8  percent, but not in Q4, says Steve Scully, IDC research manager for enterprise storage. "We saw growth coming from all the different markets."

This was a strong finish for the year, notes IDC. Total (internal plus external) factory revenue posted the first year-over-year growth since 3Q08, driven primarily by Open Networked Storage (NAS Combined with Open / iSCSI SAN), which posted its first year on year growth, of 3.6 percent, since 4Q08. NAS, which grew its revenues 12.6 percent year on year, now represents 20 percent of external disk storage systems factory revenue as users look for storage solutions to help them deal with the continued growth of unstructured, file-based data, states IDC.

Although it held on to its top spot in external disk revenue ($1.252B or 23.7 percent) EMC saw its revenue slide slightly (0.7 percent), as did No. 3, HP (7 percent) and number 5, Dell (13.5 percent), while both number 2s, IBM and NetApp, grew their revenue, at 9 and 17 percent respectively. For the year, Dell moved past NetApp to hold down the fourth position, but all five vendors reported negative revenue growth, from NetApp's 2.5 percent drop up to HP's 17.5 percent decline.

For total disk revenues, HP and IBM finished 4Q09 in a statistical tie for the top position with 19.8 percent and 19.3 percent revenue share, respectively, followed by EMC, Dell and NetApp. The positions were the same for the complete year, with HP down 17 percent, Dell off 10.4 percent, EMC falling 9.8 percent, IBM dropping 7.2 percent and NetApp showing the smallest slippage at 2.5 percent.

EMC dominates the NAS market with 50.5 percent revenue share, reports IDC, followed by NetApp with 20 percent. The iSCSI SAN market posted 41 percent revenue growth year on year, led by Dell (29 percent) and HP (18.5 percent). The total open networked disk storage market grew 3.6 percent year to $4.2 billion in revenues, headed by EMC (28 percent) and IBM (16 percent), while the Open SAN market grew 1 percent year on year, with EMC (20 percent) and IBM (19 percent) taking the revenue lead.

Although not in the top five of any category, Scully says even Sun storage sales grew quarter over quarter as customers couldn't put off delays any more, regardless of any uncertainties about the company. "They were caught up in the wave of customers buying."

Solid state drives (SSDs) or flash were not part of the study, but Scully says they are truly seeing pretty broad adoption, with almost all the major vendors offering them. Server storage was also an area that grew strongly, he adds.

It's too early for IDC to offer much guidance for the next quarter, but Scully says "the general feeling is a small uptick with a wait-to-see if there's a double dip bounce or things really pick up."