SNW - CIOs say storage vendors are gouging

CIOs and other IT managers vented their disdain for inflated storage costs and bad storage management software pricing models during a panel discussion Tuesday at Storage Networking World in San Diego.

Don Tennant, editor-in-chief of Computerworld, led the panel discussion, asking four top-level IT managers what was driving high costs of storage in their operations.

Todd Thomas, CIO of Austin Radiological Association in Austin, said his primary cost concern is the maintenance of storage equipment. "Looking at the current maintenance dollars presented to us, it would be cheaper for us to go into a new SAN environment than to continue maintenance on existing equipment," he said.

But Thomas said his company doesn't need to update its infrastructure, so his challenge over the next year is how to control maintenance costs.

Charles Inches, IT director of Corner Banca, in Lugano, Switzerland, said managing his storage infrastructure has been his greatest cost. "It's managing all this stuff that's becoming a nightmare -- cost wise, organizational wise, standard wise," Inches said.

At a certain point, he said, all users need the proper management tools to safeguard all data since there's no longer a clear distinction between production and non-production data "...Nowadays [even] e-mail is becoming production data."

The IT executives also said they aren't fond of vendors that license storage management software based on capacity. "I think it should come bundled with your hardware," Thomas said.

"It's just outrageous," said Oliver Fischer-Samano, IT director at Baerlocher Productions USA.

When Tennant asked the panel if storage pricing was fair and predictable or a mystery, Inches called it a "Turkish carpet bazaar." He said users never get the best price on first offer and must wheel and deal -- unless companies agree to long-term relationships with vendors.

"You can cut the costs down enormously on the hardware," he said. "I mean hardware capacity is going up and up and up. The speed at which the hardware is delivering more capacity is faster than the speed at which we're filling it up."

Fischer-Samano said he can slash the cost of storage hardware in half, "just by going back and saying, 'Hey I have a better quote,' even if I didn't have it. They're willing to deal. Where they don't deal is with the service agreement, and that's where they get you."

Jerry Bartlett, CIO of TD Ameritrade Holding, said that while his company tries to be vendor agnostic with technology to better drive competitive bidding, his is an almost exclusive EMC shop. "That's a bit problematic because it limits your choices. That is one of the inhibitors to flexibilty. The day you can move to a more heterogeneous environment, then you can introduce true competitiveness, as opposed to a threat that I'm going to move from this vendor to this vendor."

When asked how vendors are doing in terms of creating interoperable products to allow heterogeneous environments, the IT execs awards grades of Cs or Ds.

"I'm very, very critical," said Inches, who gave vendors a D. "Almost all the vendors are bunched up into the [Storage Networking Industry Association] organization, but they're not delivering yet."

Bartlett, who gave vendors a C-minus, said he is more optimistic about the future for device interoperability because some "well-known" vendors will come out with products that require a response from competitors.

Thomas gave the vendors an E for effort.

When asked whether they have charge-back models for storage in place, all of the executives said they do not.

Thomas said he struggled the last five years just to get charge back for telecommunications because his organization uses voice over IP.

"If your company was not born service-oriented, then it's going to be rather difficult to have this policy in place," Inches said.

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