Disk Storage Buyers Go Wild in the Third Quarter
December 13, 2010 Timothy Prickett Morgan
Just like the server racket, the disk storage business is still holding up and growing at a nice clip even after IT spending returns to something that is almost to the level set before the Great Recession. According to the latest statistics from IDC, companies worldwide consumed $6.97 billion in disk array storage in various shapes and sizes during the third quarter, representing an 18.5 percent growth rate against last year.
The amazing thing is how much storage capacity customers was consumed in Q3. The appetite for capacity, despite thin provisioning, storage virtualization, and other technologies that are supposed to put a lid on capacity growth, continues to grow, and was up a whopping 65.2 percent in the third quarter, to a total of 4,299 petabytes.
“Users are still making up for their reduced storage spending in 2009 as the third quarter recorded the fourth highest revenues in a single quarter for external disk storage systems,” explained Liz Conner, senior research analyst for storage systems at IDC. “The increased investment by end users and vendors alike in iSCSI SAN and NAS–41.4 percent and 49.8 percent year-over-year growth respectively–has helped fuel the overall growth, while easing budget constraints sparked a pickup in FC SAN and higher end systems alike.”
Thanks in large part to the internal disk storage revenue it gets from its ProLiant X64 server business, Hewlett-Packard was able to maintain its lead in the storage business in terms of revenue, with $1.36 billion in revenues (up 22 percent). But EMC, which doesn’t have a server business, is closing in fast, with 28.3 percent revenue growth in its external disk array business and pushing $1.35 billion in disk storage sales in Q3. IBM grew at about half the pace as the market at large, with revenues boosted by 9.7 percent to $1.04 billion. Dell, which has its own captive X64 server business that drives increasingly captive storage sales, saw revenues rise by 20.1 percent, to $838 million. NetApp grew at three times the pace of the overall storage market, with sales up 54.9 percent, to $601 million. And other vendors were crushed, with an aggregate of only 5.9 percent growth in the third quarter, losing a few points of revenue market share all told with $1.79 billion in combined sales and a little more than a quarter of total storage revenues.
External disk array sales represented $5.18 billion in revenues, up 19 percent over the year-ago period. EMC rules this market with more than a quarter of revenues. IBM is number two with its $667 million in sales, but it is growing at less than the pace of the market at large. Internal disk arrays accounted for just under $1.8 billion in aggregate revenues across all server makers, up 16.8 percent. If you do the math, IBM’s internal disk storage (sold under the skins of its servers) was basically flat at $368 million in the quarter, but HP grew its internal disk array sales by 31.5 percent, to $784 million. Dell’s internal disk array sales were nearly identical to Big Blue’s at $367 million, but Dell’s was growing at 26.1 percent.