WW External Disk Market Up 16% From 3Q09 to 3Q10

Worldwide external controller-based (ECB) disk storage revenue reached $4.6 billion in the third quarter of 2010, up 16 percent from nearly $4 billion in the third quarter of 2009, according to Gartner, Inc. in its latest report Quarterly Statistics: Disk Array Storage, All Regions, All Countries, 3Q10 Update.

While the ECB disk storage market declined in 2009, these 2010 results are also an increase from 2008. Third quarter 2010 worldwide ECB disk storage revenue was up 8.4 percent over the third quarter of 2008 revenue of $4.3 billion.

Except for the EMEA region, which is suffering significant economic woes, the other major geographic regions grew by double-digits year-over-year. The Latin America market grew 43.4 percent, Asia/Pacific increased 22.2 percent, Japan was up 18 percent, and North America grew 17.2 percent. Terabytes shipped in the third quarter of 2010 increased 60.4 percent over the third quarter of 2009, while price per terabyte decreased 28 percent.

"In spite of an erratic global economy, and even though IT budgets remain tight, IT executives continue to invest in ECB disk storage to support projects that yield economic efficiencies," said Roger Cox, research vice president at Gartner. "Significant investment examples include shared ECB disk storage support for virtualized server and desktop deployments, disk-based backup and recovery modernization initiatives, as well as new disk-based active archiving projects. General-purpose ECB disk storage infrastructures are also being refreshed to take advantage of new technologies that simplify storage management, reduce operational costs, improve utilization and satisfy expanding service level agreements (SLAs)."

EMC, Fujitsu and NetApp were the only top-tier vendors that were able to grow more than the ECB market in year-over-year revenue growth, with each gaining market share. Gaining 2.8 percentage points in market share, NetApp’s storage efficiency message is resonating with end-users faced with budget and data center space constraints. EMC’s broad-based ECB disk storage portfolio supports its market share gains, with V-Max continuing to produce strong year-over-year revenue results.

                    
WW External Controller-Based Disk Storage
                        
Vendor Revenue Estimates for 3Q10
                                   
(Millions of U.S. Dollars)

  
(Source: Gartner, December 2010)

Notes

• (1) EMC revenue excludes OEM revenue from Dell and Fujitsu Technology Solutions.
• (2) NetApp revenue excludes OEM revenue from IBM.
• (3) Hitachi/Hitachi Data Systems revenue excludes OEM revenue from HP, Sun and Oracle.

As evidenced by network attached storage’s 42.7 percent year-over-year growth in the third quarter of 2010, users continue to show a growing preference for modular ECB disk storage systems rather than the more-costly monolithic frame-based disk storage systems. While EMC and Fujitsu produced year-over-year revenue gains in the third quarter of 2010, the monolithic frame-based disk storage market declined to 24.5 percent of the total ECB disk storage market.

HP’s market share loss was due to its anemic position in the fast-growing NAS segment coupled with ongoing EVA year-over-year revenue declines.

While essentially holding its position in the modular ECB segment Oracle’s market share decline was due to the discontinuance of the reseller relationship with HDS for the high-end monolithic frame-based 9000 series.

Despite a 47.9 percent year-over-year revenue gain with its EqualLogic PS-series, Dell did not improve its market share position because of continued declines in Dell/EMC co-branded products.

Even though the IBM XIV Storage System attained a 112 percent year-over-year increase in the third quarter of 2010, IBM’s spotty performance with its DS-series resulted in a modest decline in market share.

Hitachi/Hitachi Data Systems third quarter results remained constrained due to the transition from the older USP-V and USP-VM systems to the just released VSP high-end monolithic frame-based disk array system. Fujitsu’s strength stemmed from robust sales of the high-end ETERNUS DX8000 series in Japan.

Gartner ECB disk storage reports reflect hardware only revenue, as well as hardware revenue associated with financial leases and managed services. Optional and separately priced storage software revenue and storage area network infrastructure components are excluded.