Storage market thrives in down economy

Customer buying fueled by digital information growth, efficiency needs

"People have increasingly been buying storage not just to store the data, but also because they want to parse out components [for analysis]," Villars says. "People are buying storage for lots of different reasons."

The lagging economy still has some impact on storage buying, however. Customers are realizing they don't need maximum performance for every type of data, so many businesses are purchasing cheap, high-capacity disks to store information that's not mission-critical. The goal is to provide tiers of storage options, some optimized for performance, others optimized by price.

The poor economy has also spurred interest in technologies that maximize use of storage space, such as thin provisioning and data de-duplication, analysts say. When you're running out of storage space, "simply buying more disks isn't the only solution," King notes.

While past drivers of storage growth included data protection and long-term retention, the goal of boosting utilization rates in the face of rapid data growth will increasingly result in customers purchasing space-saving technologies, IDC says.

In addition to storage-specific vendors like EMC, IT companies like Cisco, IBM, HP and Dell are all investing heavily in storage and having success, King says.

Sun hasn't done so well, he says, but Sun's problems run deeper than just storage.

A new crop of innovative storage vendors have been filing IPOs, Forrester analyst Andrew Reichman wrote in a report last November. The list includes 3Par, BlueArc, CommVault, Compellent, Data Domain, Isilon, Netezza and ONStor.

Vendor strategies are shifting due to emerging technologies such as solid-state flash memory and "cloud" storage, which is accessed over the Internet. Both technologies could result in a more efficient use of storage space, but that wouldn't necessarily slow down spending.

Cloud storage "changes the calculation about how the cost of storage is shared," Villars says. But "the cloud people still have to buy the storage."

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