Changes in storage systems are paramount in the development of modern datacentre computing – and yet the market continues to perform badly badly. The downturn in 2015 was 10.5%, making it the fourth year of decline. Customers didn’t spend more on raw storage in the year either – disk drives (-13.4%), DRAM (-12.4%) and Other (-16.5%) all fell. The only category to grow in the year was solid state NAND, which grew by 7.6%. The Figure shows the annual development of the storage market by type. There is some double counting here of course, because storage systems include the integration of drives and components from the other categories). You’ll be interested to look more closely at how the vendors are coping.
The main organisational change in the storage systems market is the up-coming merger of EMC and Dell, funded by Silver Lake, whose funds enabled Dell to become a private company at the end of 2014. The resulting company will also be private of course, which will make the market harder to track. EMC was market leader of the storage systems market in 2015, taking a 23.8% share of the $29.3b total. Dell was in sixth position with a 5.1% share. NetApp has agree to purchase SolidFire for $841m – a deal that should be complete in Q4 2016. It will give it a leg up in the all flash market and some very interesting software. HP Enterprise (in third position with a 10.8% share) split itself off from HP Inc. at the end of last year – the rationale for which should be evident in revenue and profit growth in 2016. IBM was in fourth position with a 7.0% share: falling business and the offloading of System x and its chip-making Technology business in recent years make its storage business vulnerable to a sell-off as well perhaps, although IBM is doing a great job of embracing a modern ‘software defined’ Spectrum approach. Two Japanese vendors Hitachi and NEC were in fifth and seventh places respectively with shares of 5.9% and 4.1% respectively.
It seems strange that an area that is so important should be performing so badly – storage virtualisation, big data analytics and ‘software defined’ storage are vital subjects in the Enterprise market. One reason is the oversupply of components and consequential price declines. I don’t believe we’ll see revenue growth in 2016, although there will be lots of organisational, architectural and technological news.