IBM's Shark Presses EMC Storage on Price

FRAMINGHAM (03/03/2000) - IBM Corp.'s Shark is chasing EMC Corp.'s Symmetrix in the deep end of the data-center storage pool and could put Hopkinton, Mass.-based EMC's comfortable profit margins in danger.

Analysts said that Shark, officially called Enterprise Storage System, is becoming a viable alternative to Symmetrix, with aggressive pricing and new features.

"If IBM can take back market share, EMC's margins will be threatened," said John Webster, an analyst at Nashua, N.H.-based Illuminata Inc. "EMC will have to be a little more competitive pricewise."

"EMC is very egregious in their pricing, and customers are starting to lash back," said Carl Greiner, an analyst at Stamford, Conn.-based Meta Group Inc.

To keep winning customers, IBM must meet delivery dates for its software, such as a remote-copy function that's due this month, he added.

Tyson Foods Inc. switched from Symmetrix to Shark last month after IBM offered better pricing. The Springdale, Ark.-based food processing company saved $100,000 by trading in Symmetrix and moving to Shark and also increased its storage capacity, said Eric Godfrey, Tyson's manager of database administration.

"We were initially concerned with the newness of the product," but the differences between Symmetrix and Shark are undiscernible, Godfrey said.

Dave Dubnick, a longtime Symmetrix user, said he has no interest in Shark.

Symmetrix costs more money, but it has better performance and more advanced features, he said.

"You can make a decision to save money, but you forgo functionality, and it hurts the production environment," said Dubnick, director of information technology at United States Cellular Corp. in Chicago.

However, EMC's current advantages may not last forever.

"EMC does have cause for concern, because IBM is trying to hit them head on," said Mike Adams, an analyst at Cambridge, Mass.-based Giga Information Group Inc.

Shark "is a screamer on paper," he said, but it currently lacks native Fibre Channel and has limited cache - 6GB compared with 16GB in Symmetrix. Once IBM adds features to Shark, users will be the real winners because they will have a choice, Adams said.

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