Network Storage : Buoyancy Continues

The network storage market pulled through another year with good growth.
Despite the down economy, the market still demonstrates buoyancy. The year gone
by has ample indicators that show that the spend on storage is very much alive.
The key drivers for the market are ever growing demand to store, intelligently
manage, and access data. With lots of unstructured data in various forms of
storage, including DAS, the network storage market in India is expected to grow
as organizations would be compelled to invest in better management of their
storage infrastructure to accrue more business benefits. Moreover, according to
experts, large and medium sized businesses are now treating storage as a
separate entity from servers, and have realized the merits of network storage
over the traditional DAS. As this realization grows, network storage will grow
much faster than the server market. According to VOICE&DATA estimates, the
network storage market grew by 25% during FY 2008-09 to reach Rs 1,834 crore.

According to IDC, by 2010 while nearly 70% of the digital universe will be
created by individuals; businesses of all sizes, agencies, governments and
associations will be responsible for the security, privacy, reliability, and
compliance of at least 85% of that same digital universe. Gartner's latest user
survey shows that 65% of the respondents in India plan to increase their 2009
budgets for storage systems. These pointers augur well for the Indian network
storage market as storage is expected to get more defined and managed by a
separate strategy.

Market Dynamics

Over the year, the trend of moving away from DAS to a networked storage
regime has continued. Among those who are still stuck with DAS, there is a trend
to move from internal DAS to external DAS for better flexibility, manageability
and increased utilization. With regards to storage area network (SAN) and
network attached storage (NAS), there is a convergence of block, file and
content services. With respect to NAS, there is a strong movement to file
services which are beyond the concept of NAS. These include search, file
treatment, file placement, and file migration. An integrated approach to file
services is the key requirement from mature customers. Continuing with the
trend, more customers will move from DAS to network storage primarily to
increase utilization, improve back-end efficiencies and storage management
operations. Ultimately, applications and their alignment with business will
solely dictate storage technologies that will be deployed.

While storage has started getting separate treatment from servers, when it
comes to virtualization, the majority of enterprises evaluating and using
storage virtualization are also evaluating and using server virtualization.

In a globally competitive and increasingly connected world, data becomes a
strategic asset, and mid-sized as much as large enterprises need to be able to
manage this asset effectively. At the same time, mid-sized enterprises do face
challenges in adopting the latest storage and data management technologies. Some
of these include: lack of dedicated storage skill sets in the IT department,
controlling IT costs, lack of the ability to easily deploy and manage the
storage systems, and the need to have an effective back-up and business
continuity plan.

Vendor-wise View

If we look at the vendor wise performance, EMC closed the year with Rs 410
crore and a growth of 22.8% as compared to last year. The company undertook a
four pronged strategy, involving market segmentation that enabled it to focus on
high potential and fast growing markets. It also strengthened, expanded, and
engaged in creating a proactive channel ecosystem.

IBM, on the other hand, focused on storage products that provided a
wide-range of network attachment capabilities to a broad range of host and
client systems. IBM caters to businesses of all sizes within a variety of
industries and provides an end-to-end datacenter solutions from disk to tape to
virtualization. HP also had a good year on storage and attacked market with a
slew of offerings, cutting across all segments.

Sun Microsystems also had good growth with government turning out to be a
good vertical over the last year. Sun also championed its Open Storage
initiative. According to Sun, Open Storage combines open source software with
industry-standard hardware, enabling enterprises to reduce their reliance on
high-priced systems and save up to 90% on storage costs. In line with that, it
launched its Storage 7000 Unified Storage System, which is claimed as the
industry's first Open Storage application that can simplify the way one manages
the storage, providing enterprises with greater flexibility, ease of use, energy
efficiency, and lower costs. NetApp also had a good year and the significant
client wins for it over the last year were the ones like Infosys, ST Micro,
Paprikaas, Tata Communications, Aviva, and Genpact.

For HDS the going was very good indeed in 2008. HDS is well positioned to
grow the markets and revenues. Its business model continues to shift from a
predominantly hardware business to the one that is more software and
services-focused, aimed at customers to derive maximum value from its solutions.
HDS says that its approach can help an organization derive more value from
existing assets-people, processes, and infrastructure. Virtualization goes
beyond improved Total Cost of Ownership and can be measured as RoA. Moreover,
the company feels that its ability on the front-end heterogeneous pools of
storage will clearly help customers achieve storage virtualization savings
percentage-wise comparable to server virtualization.

HDS is focused on enabling IT organizations to better align their
infrastructure with their business objectives through things such as storage
virtualization, dynamic tiered storage, dynamic provisioning, and gaining
control and governance over their unstructured data environments.

Outlook

At the end of the day, what emerges is that despite the down economy the
Indian market for network storage is on the growth path. The ongoing year will
see escalation of newer concepts like thin provisioning, deduplication, thin
cloning, thin replication, and IP Storage. Server virtualization would also
drive storage demand. Experts aver that the overall network storage market in
India will sustain the ongoing momentum during FY 2009-10. Customers will
continue to invest in technologies that provide cost reduction, competitive
advantage, and RoA. The adoption of proven technologies, such as virtualization,
and their capabilities, like dynamic provisioning, tiered storage, file and
content services will increase.

Shrikanth G

shrikanthg@cybermedia.co.in