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Western European Disk Storage Systems Market Overview
Eric SheppardProgram Manager, European Storage System
AgendaAgenda
Market update Market value ($ & €) Capacity demand (TBs) Historic networked storage trends
– FC, iSCSI, FICON, DAS, NAS Supplier shares and trends Capacity & revenue forecasts (2005-2010)
– External vs. internal– FC, iSCSI, FICON, DAS, NAS
Essential guidance
Note: This is a branded view of the market
Western European Market UpdateWestern European Market Update
Demand for external disk systems remains strong 56% Y/Y TB growth 7.9% Y/Y revenue growth Internal storage sales remain weak
Western European Disk Systems Market: 2Q2006
Western European Disk Systems Market: 2Q2006
•Total Disk Systems Market:– Y/Y TBs 40.7% (175.8PBs) – Y/Y Dollars 1.8% ($1.77B) – Y/Y Euros 1.1% (€1.41B)
•Total External Disk Systems Market:– Y/Y TBs 56.2% (122.5PBs) – Y/Y Dollars 7.9% ($1.22B) – Y/Y Euros 7.1% (€972M)
•Total External RAID Disk Systems Market:– Y/Y TBs 60.3% (110.6PBs) – Y/Y Dollars 8.9% ($1.14B) – Y/Y Euros 8.1% (€905.6M)
Key Trends
Western European Disk Systems Market: 2Q2006
Western European Disk Systems Market: 2Q2006
•Networked storage comments– Y/Y NAS 23.7% to $164.5M– Y/Y SAN 12.9% to $718.3M– Y/Y External DAS -6.7% to $337.1M – 2Q2006 iSCSI up 127% (Y/Y) to $19.5M
•External Arrays by Priceband:– $150K+: $463.0M -1.3% Y/Y– $50K-$150K: $297.2M -1.6% Y/Y – <$50K: $459.8M 27.9% Y/Y
Key Trends (continued)
Quarterly W.E. Disk Systems MarketQuarterly W.E. Disk Systems Market
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Market Revenue ($B)
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Market Revenue (€B)
Quarterly W.E. Disk Systems MarketQuarterly W.E. Disk Systems Market
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Market Revenue ($B)•Y/Y growth rates:
5.5% in CY2005 3.0% in 1Q2006 1.8% in 2Q2006
•Y/Y external only 7.8% in CY2005 7.9% in 1Q2006 7.9% in 2Q2006
•Y/Y internal only 1.4% in CY2005 -6.5% in 1Q2006 -9.6% in 2Q2006
Quarterly W.E. Disk Systems MarketQuarterly W.E. Disk Systems Market
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3 Months Ending 12 Months Ending
•Y/Y growth rates: 51% in CY2005 45% in 1Q2006 41% in 2Q2006
•Y/Y external only 63% in CY2005 55% in 1Q2006 56% in 2Q2006
•Y/Y internal only 34% in CY2005 25% in 1Q2006 15% in 2Q2006
capacity Shipments
Western European Market UpdateWestern European Market Update
Demand for external disk systems remains strong 56% Y/Y TB growth 7.9% Y/Y revenue growth Internal storage sales remain weak
Networked (SAN & NAS) storage remains growth engine 72% of 1H2006 external array market revenue from networked storage Support for Fibre Channel host connection is critical
W.E. External Disk Storage SystemsW.E. External Disk Storage Systems
$0.0B
$0.5B
$1.0B
$1.5B
SAN NAS External DAS
1H2005 1H2006
Market Revenue (€M)12.6% Growth
23.6% Growth
6.5% Decline
W.E. External Disk Systems Market Revenue by Installation EnvironmentW.E. External Disk Systems Market Revenue by Installation Environment
$0B
$1B
$1B
$2B
1H2004 1H2005 1H2006
FC SAN External DAS NAS FICON SAN iSCSI SAN
iSCSI $33M
Market Revenue ($B)
iSCSI $17M
Western European Market UpdateWestern European Market Update
Demand for external disk systems remains strong 56% Y/Y TB growth 7.9% Y/Y revenue growth Internal storage sales remain weak
Networked (SAN & NAS) storage remains growth engine 72% of 1H2006 external array market revenue from networked storage Support for Fibre Channel host connection is critical
Hewlett-Packard is defending its installed base better Inventory troubles at EMC helped HP increase its share gap NetApp, Sun, Dell & HDS have comparable external revenue
Western European Disk Systems Market: 2Q2006
Western European Disk Systems Market: 2Q2006
•HP was the largest external array supplier– Total external sales grew 24.9% Y/Y, 11.6% Q/Q– EVA sales $108M (+47% Y/Y, -3.4% Q/Q)– MSA sales $96.4M (+5.3% Y/Y, 14.7% Q/Q)– XP sales $79.4M (+43% Y/Y, 53% Q/Q)
•EMC second largest external array supplier– Total external sales grew 4.5% Y/Y, -21% Q/Q– Symm/DMX sales were $81.4M (+6% Y/Y, -23% Q/Q)– Branded CX sales* were $54.1M (-21% Y/Y, -32% QQ)
•IBM Third largest external array supplier– Total external array sales grew 7.3% Y/Y, 24% Q/Q– DS8000 & ESS sales were $84.3M (-14.4% Y/Y, 60% Q/Q) – DS4000 sales were $58.6M (74% Y/Y, 49% Q/Q)– DS6000 sales were $6.6M (-32% Y/Y, 60% Q/Q)
Key Supplier Trends
*Excludes sales through Dell
Western European Disk Systems Market: 2Q2006
Western European Disk Systems Market: 2Q2006
•NetApp: >8% external WE market share for the first time
– $94.5M in total revenue (45% Y/Y, 9% Q/Q) – FAS3000 $50.5M represented 53% of 2Q revenue – FAS6000 minimal for 2Q– FAS200 sales were $21M (13% Y/Y, 12% Q/Q)
•Sun increased external market ranking to #5– STK added $15M to Sun’s 2Q06 sales– Including STK, external sales grew 1.5% Y/Y, 53% Q/Q– Excluding STK, external sales fell 17.8% Y/Y, grew 53% Q/Q – Sun’s SE6000 & SE3000 declined 28% & 22% Y/Y respectively– SE9900 declined 8% Y/Y ($23.1M)
•Dell’s external array ranking fell one spot to #6– External revenue declined 16% Y/Y, 13% Q/Q– Dell|EMC revenue was $48M (-18% Y/Y, -13% Q/Q)– NAS revenue fell 60% Y/Y to $2.3M
WE External Array Factory Revenue by Priceband & Select SupplierWE External Array Factory Revenue by Priceband & Select Supplier
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$0K-$49.99K $50K - $149.99K $150K+
HP EMC IBM NTAP Dell Sun HDS Others
W.E. External Disk Systems Supplier Revenue-Limited Suppliers ($M)W.E. External Disk Systems Supplier Revenue-Limited Suppliers ($M)
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3 Month Quarters
No FSC quarterly data prior to 2005
W.E. External Disk Systems Supplier Revenue-Limited Suppliers ($M)W.E. External Disk Systems Supplier Revenue-Limited Suppliers ($M)
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12 Month Quarters
Western European Market UpdateWestern European Market Update
Demand for external disk systems remains strong 56% Y/Y TB growth 7.9% Y/Y revenue growth Internal storage sales remain weak
Networked (SAN & NAS) storage remains growth engine 72% of 1H2006 external array market revenue from networked storage Support for Fibre Channel host connection is critical
Hewlett-Packard is defending its installed base better Inventory troubles at EMC helped HP increase its share gap NetApp, Sun, Dell & HDS have comparable external revenue
Storage demand to remain strong through 2010 52% capacity shipment CAGR (2006-2010) Price pressure to keep revenue growth moderate Blade servers to accelerate market shift towards external, networked arrays
WE Disk Storage Systems ForecastWE Disk Storage Systems Forecast
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2004 2005 2006 2007 2008 2009 2010
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Int. Revenue Ext. Revenue Exabytes
•Total capacity Shipments: 40% internal CAGR 55% external CAGR
•Total Market Revenue ($M): -4.1% internal CAGR 3.2% external CAGR
Price Pressure from: capacity optimized HDDs Market maturation Increase competition
Blade servers to accelerate market shift towards external arrays
WE Disk Systems Market Revenue GrowthWE Disk Systems Market Revenue Growth
-8%
-6%
-4%
-2%
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6%
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Total External Internal
WE External Disk Systems Market Revenue GrowthWE External Disk Systems Market Revenue Growth
-15%
-10%
-5%
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DAS SAN NAS Total Ext.
Networked storage 6.6% CAGR 2005-2010.
Fibre Channel remains the largest segment.
SAN growth acceleration partly from:
Market shift to blades Increased adoption
from <$50K arrays
iSCSI CAGR of 68% 1.5% of 2005
networked storage 15.8% of 2010
networked storage
WE Disk Systems Market Revenue by Installation EnvironmentWE Disk Systems Market Revenue by Installation Environment
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2004 2005 2006 2007 2008 2009 2010
FC SAN DAS NAS FICON SAN iSCSI SAN
Top Storage Priorities In EuropeTop Storage Priorities In Europe
Source: IDC, 4Q2005
Which THREE of the following are your company's top priorities relating to storage for the next 12 months?
Responses
0 20 40 60 80 100 120 140 160 180
Consolidate isolated SAN islands
Deploy solutions for easier storage mgmt
Consolidate storage onto fewer platforms
Reduce backup windows
Enhance disaster recovery plans
Ensure data retention compliance
Reduce storage-related costs
Optimize disk utilization
Reduced recovery/restore times
Improve storage performance
Expand storage capacity
N: 508
The Business Content Expanding StorageThe Business Content Expanding Storage
Copies to provide protection and rapid restoration – example remote DR data centers
Shift for older, more expensive, less efficient technologies (paper, microfiche, Etc.) – example Electronic Medical Records
Applications generating more complex data – examples - CRM, ERP, Etc.
Copies used in data marts to generate value from historic data – analytics, Etc.
Use of capacity hogging images and video – training, web support, Etc.
Increased competitive intensity – global competition, speed of new product introductions, lower margins
General unwillingness to get rid of anything
…and the impact?
WW ATA Adoption Reduces Storage CostWW ATA Adoption Reduces Storage Cost
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SCSI/FC PBs ATA PBs Storage $/GB
SCSI/FC disk drives have been the mainstay throughout much of history
But there is an increasing presence of ATA storage in the datacenter. Why?
Surveys of data center managers continue to confirm that the majority of storage TBs do not need to reside on high-performance storage
Petabytes
WW HDD TB Shipments into Enterprise Storage Solutions by Type
WW Capacity vs Performance-Oriented DrivesWW Capacity vs Performance-Oriented Drives
The availability of large capacity, low-cost “good enough” storage will continue to attract the attention of IT managers.
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Capacity Performance
WE External Disk Systems Raw Capacity CostWE External Disk Systems Raw Capacity Cost
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# of TBs at 2005 Prices $/GB
$13.4K Buys 1TB
$13.4K Buys 7.5TBs
WE Disk Storage Systems ForecastWE Disk Storage Systems Forecast
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2004 2005 2006 2007 2008 2009 2010
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Int. Revenue Ext. Revenue Exabytes
Ext. TB shipments to increase at a 55% CAGR
Who plans to increase their data centers 500%?
Who plans to increase their IT staff by 500%?
Managing this explosion in capacity remains a key challenge
Suppliers must focus on enabling improved efficiencies, but without comparable price increases
Look to services & software
Worldwide Storage Market Revenue by Technology & Compound Annual GrowthWorldwide Storage Market Revenue by Technology & Compound Annual Growth
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-5% 0% 5% 10% 15%2005-2009 CAGR (%)
2005
Rev
enu
e ($
M)
Storage Services
Disk Systems (Arrays)
Storage Software
Optical Automation
SAN InfrastructureTape Automation
Essential GuidanceEssential GuidanceThe storage industry must:
Provide greater flexibility in purchasing and expanding storage capacity
– Storage as a utility???
Provide a way to maximize useful storage capacity and leverage existing storage resources
Enable reduction of ongoing administration costs in terms of staff, timeliness, and quality
– Raw capacity costs may be decreasing, but mgt. costs are not.
Impact on storage solutions: Increased storage solutions that support tiers of storage optimized to meet
specific requirements for performance, cost, capacity, and availability
Common data replication and migration capabilities that allow IT managers to easily and intelligently move data between different classes of storage
Storage management solutions that centralize and automate provisioning, expansion, and data protection tasks across heterogeneous systems