Backup fuels software market growth
By Zachary Shess
With storage management widely viewed as one of the largest IT expenditures, administrators are continuing to turn to storage management software as one way to corral these costs. The need to centralize resources has fueled steady growth in storage management software, according to a recent report from Dataquest, a market research firm in San Jose.
By surpassing $2 billion in revenues in 1997, the storage management software market saw a 19% increase over 1996. Propelled by three primary product categories--core, backup/HSM, and storage resource management (SRM)--worldwide revenues are expected to reach $4.8 billion by 2002.
With $1.33 billion in 1997, backup/HSM products garnered the most revenue of the three segments. Backup/HSM includes backup, restore, archive, and HSM tools.
Ranking second last year were core storage management products. This category, which includes physical replication, volume management, and file systems, offer basic storage functions such as ensuring data integrity and availability. Worldwide revenues for core storage management products topped $478 million last year.
SRM products manage properties of physical and logical storage resources such as media health, availability, space loading, performance connectivity, and utilization. In 1997, this category accounted for $210 million.
"As companies consolidate their storage management resources and recentralize them, they need higher-level tools that will manage storage across the enterprise, help them do asset planning, and be more proactive than reactive," says Carolyn DiCenzo, a principal analyst at Dataquest.
"The consolidation requires new tools at the high end. At the low end, storage hardware vendors are looking for ways to differentiate their hardware products. As the products become increasingly similar, vendors are looking for ways to tightly integrate value-added features," she adds.
DiCenzo points to EMC as an example. A traditional storage hardware vendor, EMC has coupled value-added software management functionality to its Symmetrix enterprise storage systems with products such as TimeFinder.
The current market conditions are also the result of a gradual decline in storage management tools designed just for the desktop. Computer Associates (CA), Cheyenne (prior to its acquisition by CA), and Seagate Software initially did very well in this business, but DiCenzo says backup at the desktop just never took off.
"People want backup to be automatic, with someone else controlling it. That`s one of the reasons why you`re seeing the recentralization," DiCenzo says. "Most of those vendors have moved into the distributed space, so that a single server in the network is controlling the backup, whether it`s to a local device or across the network."
Looking to the future, the backup/HSM product category will continue to be the most lucrative segment of the overall storage software management market, with a projected 21% percent compound annual growth rate over the next five years, according to the report. The findings also indicate a mild renaissance for HSM, a technology that DiCenzo says was a good idea that was initially brought to market at the wrong time. "The reason why HSM never caught on is that people never solved their backup problem enough to start focusing on some of the more sophisticated tools," she says.
Today, HSM is increasingly taking shape as an embedded feature within vendors` backup solutions, and less as a separate product. "Now that distributed tools are out there and you have fewer and smarter people actually controlling storage management, they`ll be able to start looking at value-added features such as HSM," says DiCenzo.
Computer Associates led the backup/HSM segment with 29% of the total revenue on all platforms. In the Windows NT arena, Seagate Software led the market with a 42% share, while Hewlett-Packard`s 17.5% share topped the UNIX-based market.
Overall, the leaders in storage management software last year were IBM (26%), Computer Associates (16%), EMC (8%), Seagate Software (7%), Veritas (4%), and Legato (3%).