Before the War, the Storage Sector Peacefully Soldiers On

With many analysts putting the figure for the data storage market in the
billions over the next few years, it’s no wonder top tech firms are both
pumping out upgraded products, and scrambling to ink new deals with key
partners. But a recent Goldman Sachs report questioned how long it would be
before the companies, which have many similar and/or overlapping
technologies, continue to play nice.


IBM Corp. Tuesday chalked up the former when it rolled out a couple of network-attached storage (NAS) towers as
part of the next phase of its storage networking initiative, which debuted
last February. Brocade inked the latter with Sun Microsystems Inc., a
long-time EMC Corp. partner.


Big Blue launched the IBM TotalStorage NAS 200, a tower (one processor and
up to 216 GB) targeted for the service provider community and e-mail storage
or video file serving, and the more sophisticated, dual engine, TotalStorage
NAS 300, which powers applications, such as accounts receivable, payroll or
customer support, in large departments and small enterprise settings.


The NAS 200 also comes in a rack version designed for departmental and
regional office locations for applications such as sales force support. As
for the higher-end product, Big Blue also now offers a 300G version, which
it says bridges the gap between the local area network (LAN) and a storage
area network (SAN) with new clustering technology.


With these products, IBM is addressing the needs of customers who want to
reduce their dependency on servers for access and management of storage
while using the LAN to consolidate and store file data. And despite scads of
competitors in the storage networking arena, IBM seems to be targeting
Network Appliance in comparison, claiming that its new towers have bested
NetApp’s own products in benchmark tests. While the companies will no doubt
disagree on the accuracy of each other’s tests, one analyst who scrutinized
IBM’s NAS 200 and 300 towers attested to the potential of a single selling
point for Big Blue: David G. Hill, research director, Storage & Storage
Management, Aberdeen Group said “workgroup level customers will enjoy a
sweet spot in price and performance.”


While Big Blue shows its competitive colors with its new NAS releases, the
company has also collaborated with rivals in the field to help the industry
move forward; last Monday, IBM teamed with Brocade Communications Systems
Inc., Compaq Computer Corp., EMC, Hitachi Data Systems Corp. and McData
Corp. to work on interoperable storage networking solutions under the aegis
of the Storage Networking Industry Association
(SNIA)
. The mass collaboration caused one analyst, Sean Derrington of
Meta Group, to praise the firms for their willingness to work together.


“The fact that competing storage vendors have been able to agree on
configurations and software levels to jointly qualify and have entered into
cooperative support agreements is remarkable,” Derrington said in a public
release.


Allied and Axis Powers


The cooperative spirit was there for all to see last week, and it trickled
over this week when Brocade, a leading switch provider for storage area
networks (SANs), and Sun, forged a deal that would allow the hardware giant
to resell, service and support Brocade’s flagship SilkWorm fabric switches
on a global basis. Brocade and Sun will also forge supported storage
networking configurations as well as work together on the software
development initiatives that were announced earlier this year.


Again, the announcement drew nothing but praise from an industry analyst,
this time from Steve Duplessie, founder and senior analyst, the Enterprise
Storage Group.


“Sun partnering with Brocade represents two market leaders working more
closely to deliver storage networking solutions to Solaris and other
operating environments,” said Duplessie. “Sun is the UNIX king and Brocade
is the fibre channel switch king. Their customers will be happy.”


But Goldman Sachs’ Laura Conigliaro took a more holistic view after
attending Brocade’s analyst meeting Monday night. She noted that Wall Street
is a bit unsure as to how the switch specialist’s July quarter would fare in
the bear market, but that Brocade is enjoying “enough critical mass that it
can gather together an impressive number of customers.” Translation: no
worries yet.


Conigliaro research yielded the fact that customers are very much interested
in deploying SANs, which Brocade specializes in powering. She heard from
customers who claimed they would set up starter SANs with two to three
switches, but pledged to expand to 10 switches by year’s end. While this is
certainly good news for Brocade, Conigliaro indicated the sun doesn’t shine
as bright on the sector in terms of interoperability, as last week’s
six-company, SNIA partnership indicated.


“… despite much talk about interoperability, end users remain skeptical ,
and are likely to remain with a homogeneous SAN for the foreseeable future,”
Congiliaro said.


So, the synopsis is that things look good for Brocade, an important player
in the field, but hardly the only one. No, there is more than currently
meets the eye and for the switch maker, king hardware company Cisco Systems
Inc. looms large on the horizon. Conigliaro indicated in a research note
last week that while many storage networking product makers are getting
along nicely now, that there will be a period of shakeout, price
undercutting, and a time for rivals to “lock horns.”


“The merging of storage and networking technologies in storage networking
imply that companies will be in a state of ‘coopetition’ for the near term
but will be more competitive going forward. From the storage networking
side, Brocade is emerging as the leader in providing a robust and feature
rich platform. At the same time, Cisco is emerging as the leader in
providing complementary tools to extend and broaden the reach of SANs, and
continues to work with Brocade in developing a blade that would enable two
distant fibre channel SANs to be connected via IP,” Conigliaro wrote. “Since
both companies have broader ambitions beyond their current capabilities —
with Brocade looking to add traditional networking features such as security
and QoS to its platform as well as add multiprotocol capabilities such as IP
to its switches, and Cisco looking to
extend the reach of its products beyond just interconnecting SANs, including
working on the development of large multi-protocol switches in its highly
secretive Andiamo group — the two are increasingly likely to be competing
with each other in the future.”


Rest assured, Cisco and Brocade are hardly the only contenders analysts see
as duking it out in the storage ring later. There is IBM and Network
Appliance, Hitachi and EMC — the list goes on and on. Figuring out who will
square up with who will no doubt prove as maddening as it will be
interesting to watch in the next year.

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