Cloud May Affect Storage Distributors

Integrators, Value-Added Resellers (VAR), Value-Added Distributors (VAD) and distributors represent the channel, a big part of the sales of the worldwide storage industry.

Users often prefer to go through – relatively – independent specialists to configure their architecture with the best products and software on the market rather than to deal with an unique storage vendor. They like to work with a company who assembles, augments, modifies, and repackages a system to suit their specific individual needs to get an integrated and complete turn-key solution, and also supporting services, maintenance and training.

Furthermore big storage hardware manufacturers and software publishers don’t have the channel to approach all territories on the planet, especially the smallest ones. Some of them finally acquired their biggest distributors. But it’s too expensive to be anywhere.

Nevertheless a new difficulty is happening for the distribution: cloud storage.

Rather than to buy a storage system, it’s now possible to replace it by putting in the cloud all the data on the site of external online companies for backup and archiving.

Some of these online providers now have enterprise applications. We think here not only about the big ones (Amazon, Atmos, Google, etc.) but smaller firms with enterprise offering (Asigra, Box, Cloud Leverage, EVault, Mezeo, Nirvanix, ownCloud, Panzura, Securstore, Smart Storage, StorSimple, Vaultize, Zetta, etc.).

In a recent Asigra’s survey conducted by TechValidate, 66% of respondents are considering cloud backup. This relatively recent technology was first adopted by consumers, then SMBs and now big organizations because the prices are going down (as an example, 1TB costs $125 per month at Amazon), the bandwidth on Internet is faster, and the offering is more secure and sophisticated.

Companies choosing cloud storage do not need to install hardware and software in-house, and consequently an integrator.

We don’t say that the storage distribution market will dye but it could decelerate even if end users will continue to deal with outside specialists to build hybrid storage (inside and outside backup) and private cloud storage.

If the data are on the cloud, it means also that they are stored elsewhere, on configuration owned by the online providers. The huge ones have their own team of storage experts to build it. The other ones will continue to be a market – and a growing one – for the integrators.

These remarks could by apply in the future to cloud computing, with processing, storage and backup and archiving totally subcontracted to external cloud providers.