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Sweeping Changes Ahead for Fibre Channel

A new study claims Fibre Channel storage is on the edge of a major evolution, propelled by ballooning demand for new systems that promise greater virtualization features and improved efficiency.

The trend comes as a result of enterprises' growing needs for energy efficiency, simpler management and more advanced storage optimization options, according to market research firm Taneja Group.

As a consequence of those needs, a new crop of vendors may be poised for dominance, the company found in its new study.

"This new breed of storage systems directly addresses the needs of the virtualized datacenter -- something that traditional storage systems were never designed to do," said Arun Taneja, the company's founder, in a statement.

While the overall Fibre Channel market's growth rates in the next three years aren't stunning -- just a 3 percent bump to $10.2 billion by 2011 from $9 billion last year, according to Taneja -- the research firm expects huge expansion in emerging mid-range and high-end solutions.

Those areas together will see an 85 percent compound annual growth rate in revenue, going from $170 million last year to $2 billion in 2011.

Driving that growth will be a new wave of solutions from vendors eyeing a piece of the pie. And if the report's predictions are correct, they're likely to get the biggest slice.

"From our vantage point, the next five years should be a pivotal time in the Fibre Channel storage marketplace as market leadership comes into question and new leaders are anointed," the study said.

Shake-up in mid-range, high-end segments

Mid-range systems will rake in the lion's share from this emerging category, with growth rising meteorically from 2007's $90 million to $1.034 billion by 2011. Higher-end system sales, meanwhile, will expand at an 87 percent compound annual rate to $973 million in 2011, the Taneja report said.

Mid-range systems are generally geared for single-purpose workloads, such as e-mail systems. Price points range from $25,000 to $150,000, according to the report.

Traditionally, mid-range systems are built around dual-controller modular storage array supporting RAID and basic virtualization capabilities -- such as the CLARiiON CX series, the IBM DS4000 series, HP's Enterprise Virtualization Array, Hitachi's Adaptable Modular Storage, NetApp's FAS series and Xiotech Magnitude.

But the Taneja Group also sees an emerging group of mid-range offerings on the horizon. Those new offerings, which include the 3PAR InServ E-Class, Compellent's Storage Center and Pillar Data Systems' Axiom, feature self-configuration and self-tuning capabilities, clustered controller design and automated storage tiering.

With their advanced features, the new breed will snag a growing portion of enterprise spending, the report said.

"Server virtualization and consolidation, green storage initiatives, and the need to contain [operational expense] costs associated with storage management are forcing users to rethink their traditional storage solutions," Taneja said in the report.

Taneja sees a similar pattern developing in mission-critical, high-end systems as well, where prices range from $150,000 to nearly a million.

The firm said "monolithic" high-end storage systems are giving way to next-generation solutions, spurred by greater return-on-investment expectations, virtualization technologies and a enterprises' growing focus on a more agile infrastructure.

Taneja said older high-end offerings -- featuring RAID controllers and disk drives in a big one-size-fits-all enclosure -- are mature and "battle-tested." But they also require expertise when it comes to configuration, the company said in the report.

As a result, products in the category like EMC's Symmetrix DMX series, IBM's DS 6000 and DS8000 series, and Hitachi's TagmaStore offerings will face competition from new solutions.

The new class includes products often used for consolidation within datacenters, such as the 3PAR InServ S-Class and XIV Information Systems' NEXTRA line.

The report also found that while major players like IBM, Hitachi, HP and EMC have long dominated the Fibre Channel market, their rule won't last long: New players are proving they "have the mettle to compete with the entrenched Tier 1 players on their terms."

A similar change has taken place elsewhere in the storage market, the report said.

The new entrants' design "represent an inevitable evolution in storage system designs," the report added. "The competitive dynamics of the Fibre Channel market will be no different than the competitive dynamics in the [network-attached storage], iSCSI or [content-addressable storage] spaces."