Gartner: Disk array market rebounds

Posted on July 07, 2005

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By Ann Silverthorn

—Gartner's latest report on the worldwide external controller-based (ECB) disk storage market reveals a healthy rebound in the first quarter of 2005 compared to what the research/consulting firm calls a "lackluster" performance in the second half of 2004. With an 11% increase over Q1 2004, ECB disk storage revenue totaled $3.54 billion in Q1 2005 (see table below).

Although sitting at fifth and sixth places based on total revenue, Dell and Network Appliance posted the highest gains—;35.8% and 27.2%, respectively. Roger W. Cox, vice president in the storage research group at Gartner, says, "Dell has steadily enhanced its credibility as a provider of midrange enterprise-class ECB disk storage attached to a SAN."

Cox also praised Network Appliance's ability to "defy market seasonality to achieve sequential quarterly growth." He attributes NetApp's success to "its single management platform, simple product lines, and effective execution on unified storage serving various applications."

In the top three positions in terms of revenue, EMC, Hewlett-Packard, and IBM, respectively, posted moderate gains. Hewlett-Packard's revenue gain was only 6.2%, compared with EMC at 11.2% and IBM at 13.6%. Still, this was HP's first positive quarter in more than a year. Its EVA and MSA-series revenue increased 17% over the first quarter of 2004. The XP-series, which HP sources from Hitachi Data Systems, was down on a year-over-year basis.

Similarly, Sun's high-end SE9000 (also sourced from Hitachi) continued its fall off. Overall, Sun is struggling in the ECB disk storage market, showing a 17.4% decline. Revenue from the company's midrange ECB disk products was 2.7% lower in the first quarter of 2005 than in the first quarter of 2004. According to the Gartner report: "[Sun's] much-touted SE6920 has yet to gain noticeable market traction."

Hitachi, which stands at fourth place among the ECB disk storage vendors, posted a 9.6% revenue gain, with its Lightning and TagmaStore disk arrays producing the majority of Hitachi's branded revenue. (Gartner's figures do not include the OEM revenue from HP and Sun.)

Gartner reports that EMC continues to penetrate the midrange market with its storage software portfolio, professional services capabilities, and growing channel presence. Meanwhile, IBM has been reversing the declines from the second half of 2004 caused by product transition issues with the high-end of its disk systems portfolio.

"ECB Disk Storage Market Showed Healthy Growth in 1Q05" is available on Gartner's Website at www.gartner.com/DisplayDocument?ref=g_search&id=482241.

Worldwide External Controller-Based Disk Storage Vendor Revenue Estimates for 1Q05 (Millions of U.S. Dollars)

Company 1QO5 Revenue 1Q05 Market Share (%) 1Q04 Revenue 1Q04 Market Share (%) 1Q04-1Q05 Growth (%)
EMC 814.7 23.0 732.9 23.2 11.2
Hewlett-Packard 643.1 15.9 529.6 16.6 6.2
IBM 421.1 11.9 370.7 11.6 13.6
Hitachi/HDS 368.5 10.4 336.2 10.6 9.6
Dell 231.8 6.6 170.7 5.4 35.8
Network Appliance 211.7 6.0 166.5 5.2 27.2
Sun Microsystems 175.9 5.0 213.0 6.7 -17.4
Others 752.1 21.3 666.3 20.9 12.9
Total 3,538.5 100.0 3,185.9 100.0 11.1
Source: Gartner Dataquest (June 2005)

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