You might have seen that EMC purchased XtremIO this week. As I said in previous predictions, the SSD market will continue to consolidate. I believe the trend will continue to accelerate for the following reasons:
- There is a limited market: The market for SSDs whether they are storage controllers with SSDs, individual SSDs or PCIe cards is limited compared to the size of the storage market.
- It costs money to have marketing and sales staff: Every company must make a profit to stay in business. A limited market and the overhead of having sales and marketing staff all trying to sell into the same limited market is a problem. The cost of sales for non-commodity products is high. Flying people around, hotels, meals, and salaries and benefits require significant profit, and selling non-commodity products is often a long sales cycle.
- The cost of R&D is expensive: You have many vendors basically making the same products. Yes, you might have some product differentiation with quality, reliability and so on, but how many PCIe SSD vendors does the world need? How many controller SSD vendors does the world need? The answer seems to be fewer than we have today, as the market is consolidating.
Last, but certainly not least, is the fact that SSDs are more expensive than disk storage and cannot be used for everything because of their cost. Most of the people I have talked to are looking for some type of tiered storage, and I think you will continue to see storage controller companies buying SSD companies so they can have tiered storage. The cost of SSDs is still not tractable for large bulk data storage, and it is tractable only for high IOPS environments. The question is what happens after the SSDs and disk tier? That is the topic for my next entry.
posted by: Henry Newman