Dell storage chief on where storage is heading

As the executive in charge of Dell Computer's storage business, Russ Holt, vice president and general manager of Dell's enterprise systems group, manages what he calls an "emerging" business that's already earning the company US$1 billion a year. At the Technology Leadership Forum, sponsored by Cambridge, Mass.-based Forrester Research Inc., Holt spoke with Computerworld about where Dell's storage foray is heading.

Q: Given that many companies are undergoing server consolidation by means of augmenting their storage resources, do you see Dell's storage group taking any business away from its server group?

There is a trend toward consolidation, but we don't see it necessarily as fewer servers. There is no lack of necessity still for the computing capability and the applications, but from the CIO's perspective, it was becoming very difficult for him to manage that. So it's a consolidation back into the data center [stemming from the] ineffective utilization of storage. What we've seen is a trend toward rack-dense or rack-optimized servers; the form factors have changed. And what we've typically found is that customers are adding new projects and applications for productivity, so it tends to offset the consolidation that's happening. Given the commoditization, you're getting back to a similar model that we've seen in PCs where you can refresh these [servers] every three to five years now.

Q: But you do see server consolidation as a driver for your storage business?

Absolutely. It's easier-to-manage, more effective use of disk space. You can have one administrator supporting 6TB as opposed to just being able to support 1TB before.

Q: What percentage of Dell's business is storage, and how do you see that changing over time?

We're over $1 billion in annual revenue for our external storage -- that's over 60 percent year-over-year growth. In our fourth quarter, we had almost 90 percent year-over-year growth in storage. Dell's total revenue is over $30 billion, so storage is a small portion right now. But we look at it in the whole context of our enterprise business, which now accounts for about 20 percent of our total revenue.

Q: What will Dell's storage business look like five years from now?

We're talking about growth targets within the company to double the size of our total business; we haven't given a timeline on that, but most analysts are projecting a five- to seven-year time frame. The key areas driving that growth are, No. 1, we continue to have a very solid client business, and we expect that to grow stronger internationally. Our enterprise business is a real strategic part, so both servers and storage are key parts of the company's ability to double revenue in the next five to seven years.

From the standpoint of product capabilities, it will just be to continue to monitor and adjust with the trends. We actually have a very complete portfolio of storage products right now.

Q: What is your monitoring of the Internet Small Computer Systems Interface protocol (iSCSI) trend telling you?

The standard for iSCSI was just ratified [less than] a month ago. These emerging technologies tend to take off a lot slower than most analysts would like them to, because they're the latest thing to talk about. I don't expect that iSCSI is going to replace Fibre Channel -- it could be a question whether it replaces it at all; clearly not in the near term.

However, there are some clear uses where iSCSI will provide some benefits. The first environment is in wide-area connectivity for SANs. Another use is providing block support on network-attached storage. Currently, NAS boxes are only file-based access; iSCSI can provide block-based access. Those two areas are the areas we're involved in.

Q: How about InfiniBand I/O technology?

We continue to be favorable toward InfiniBand. It's one of those products in the very early stages of standardization, so it's not something that's going to happen overnight. As the modular blade-type servers start to standardize a bit more, we think InfiniBand will play a key role in the system-level communication between servers. We don't see InfiniBand taking over storage interconnects like Fibre Channel. We don't see it taking over the network like IP. But it will be an important transport medium between modular servers.

Q: So would your strategy be to let IBM and Sun test the InfiniBand waters or to jump in first?

We're working on InfiniBand-related products ourselves. We won't necessarily wait for IBM or Sun to pave the way. But we're also very keen on delivering relevant technology to the marketplace. InfiniBand is relevant, but the timing is what we're working through right now.

Q: How do you see your relationship with EMC Corp. evolving over the next few years?

We entered into the relationship in October of last year. The tenets that led us to the relationship hold and have been validated. [Dell's] view [is] that all technology is progressing along a standardization curve. The area where there's still a lot of complexity and a lack of standards is in the Fibre Channel SAN area. From a Dell perspective, that's not an area where we want to invest a lot of our own resources, because there aren't standards there. So we chose to partner with EMC, primarily because of their strong software focus, which we think is critical to the future of storage.

As a progression of the relationship, one of the things we've been doing is helping to drive the growth of the midrange. [Following] our collaboration on bringing the CX200 [entry-level RAID array] product to market, EMC has entered into a manufacturing agreement for the first time, that being with Dell. So we'll be manufacturing the CX200 product beginning this quarter.

Q: EMC managed to report a pretty strong fourth quarter. How much credit can Dell take for that?

If you look at what EMC said, Clariion was a bright spot. Dell now makes up a little over a third of their Clariion business. So I'd say we had a pretty significant impact.

Q: What's going to be new from Dell storage-wise over the next year?

ATA [Advanced Technology Attachment] drives are being used more in the enterprise. You'll see Fiber Channel-connected ATA drives coming from Dell and EMC in the first half of this year. That will allow customers to continue to put their business applications and mission-critical data on core Fiber Channel systems, but have the capability for snapshots or mirroring to less expensive disks like ATA drives. That will progress to serial ATA starting to show up in the latter part of the year and serial-attached SCSI devices about a year after that.

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