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2002, May week 3b, news archive

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Squeak! - The fastest growing profitable US STORAGE companies - 2002
Squeak! - The 10 biggest storage companies in 2004?
Squeak! - The Top 10 Storage Software Companies
Squeak! - Venture funds in storage
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Sunnyvale, CA - May 21, 2002 - Network Appliance, Inc. today announced the results of a new study from IDC that validates the business benefits and the ROI of the NetApp® ECDN solution. IDC found that the companies studied made average ECDN investments of approximately $2.9 million over three years and realized an average payback period for the solution of less than three months.

The year-long IDC study, titled "Quantifying the Business Benefits of Enterprise Content Delivery Networks," surveyed Network Appliance's Fortune 500 ECDN customers to gather information about their operating costs, business processes, and technical environments. IDC analyzed this data and averaged the results over a three-year period. The study showed benefits spanning a wide range of business processes. Major elements that contributed to the ROI results include reductions in operating costs that are made possible with the ECDN solution, cost savings realized from content availability and minimal network downtime, and increased user and IT productivity.

"Based on IDC research, initial fiscal investment of a Network Appliance™ ECDN solution is approximately $2.9 million, which can result in savings of close to $30 million over a three-year period," said Lucinda Borovick, analyst at IDC. "The savings result from the solution's ability to enable easy access to critical business information such as company news and announcements, training materials, and industry information, as well as Web-enabled ERP and CRM information systems, corporate portals, e-learning, and online video conferencing." ...IDC profile, ...Network Appliance profile


Austin, Texas - May 21, 2002 - Dell today announced the PowerVault 122T, a 2U SCSI connected rackmount, automated tape-backup storage system for businesses that want to lower the overall cost of protecting critical data. The PowerVault 122T has one DLT VS80 tape drive and holds eight-cartridges for a maximum storage capacity of 320GB (640GB with 2:1 compression). The system offers maximum performance with a data transfer rate of 3MB per second (6MB per second with 2:1 compression). The PowerVault 122T is available worldwide with prices starting at $4,150. ...Dell Computer profile


ORINDA, Calif. - May 21, 2002 - Dantz Development Corporation, a premier provider of backup and restore software, today announced the appointment of industry veteran Leslie J. Alvarez, C.P.A., as the company's chief financial officer. In her new position as Dantz CFO, Alvarez will be responsible for managing the finance and accounting, technical support, information technology and product production departments. Her key focus will be on increasing bottom-line profits through financial discipline and analysis, implementation of enterprise systems and reporting, and profitable delivery of high-quality technical support. She reports to Lawrence A. Zulch, Chief Executive Officer and President.

"Leslie joins Dantz at an opportune time for our company. We have a strong management team of executives, a loyal and impressive roster of customers, and an award-winning product line, all of which position Dantz as the preeminent leader in backup and restore software for the small- to mid-size enterprise market," said Zulch. "We look forward to her contributions as we position the company for the next phase of growth after our initial 18 years of success."

Alvarez brings to Dantz a strong background in finance and operations with particular expertise in mergers, acquisitions and initial public offerings. Prior to joining Dantz, Alvarez led and completed the acquisition of FamilyWonder.com by Sega.com, where she served as vice president and CFO. Before FamilyWonder.com, Alvarez as CFO managed the finance and accounting functions and facilities at Alysis Technologies, where she initiated the acquisition of a software division and led and completed a $4 million Preferred Securities offering. ...Dantz Development profile

Editor's comments:- as I've indicated in this week's column, (lower right) storage companies need good financial controls and business management as much as they need technology to survive in the blood bath of this recovery.



SCOTTSDALE, Ariz. - May 21, 2002 - In-Stat/MDR has published a market research report, "From TiVo to the iPod, Hard Disk Drives Penetrate Consumer Electronics Products" (priced at $2,995) which examines and updates the integration of hard disk drive-based storage in consumer electronics products.
  • Worldwide unit shipments of personal video recorders (PVRs) are forecasted to increase from 1.2 million in 2001, to over 6 million in 2003.
  • Satellite set top boxes with integrated hard disk drives will continue to make up the bulk of PVR unit shipments.
  • Portable digital music players that integrate hard disk drives have proven to be extremely popular. Led by models like the iPod and the Rio Riot, worldwide unit shipments are forecasted to increase from 230,000 in 2001 to over 950,000 in 2003.
"Many of the leading hard disk drive manufacturers have been developing products for the consumer market for several years, and they are finally beginning to taste success, " according to Mike Paxton, a Senior Analyst with the high-tech research firm. "While the PC industry remains the most important market for hard disk drives, the consumer electronics market is developing into an excellent secondary market segment." ...In-Stat profile


May 21, 2002 - a whitepaper called "NAS Device Backup Solutions: NDMP" (20 page pdf) has been released today on STORAGEsearch.com by Datalink Corporation . The explosion of data generation and storage in recent years has led to the introduction of new technologies for storing and managing this data. One of the online storage architectures that has emerged is NAS, which essentially separates application servers and data, and stores the data on storage devices that perform dedicated file serving tasks. A NAS device is typically a dedicated, high-performance, high-speed communicating single-purpose file server. While offering many storage management benefits, NAS presents data backup performance and integrity challenges to organizations that attempt to incorporate NAS into their traditional data protection practices. NDMP (Network Data Management Protocol) was developed to address those challenges by creating efficient and sound backup methodologies that offer high performance restoration capabilities in NAS environments.

The NAS backup solutions discussed in this document present solutions of varying degrees of performance, production impact, restoration capabilities, and preservation of file system integrity. An optimal solution incorporates an appropriate combination of these technologies to achieve an organization's recovery point objectives as well as recovery time objectives. ...Datalink profile


HSICHIH, TAIWAN - MAY. 21, 2002 - AnexTEK Global Inc. today announced that it has signed an agreement with Quantum Corp. to offer Quantum's PowerStor line of tape backup products in Taiwan. Under the agreement, AnexTEK will be a distributor and service provider in Taiwan for Quantum's Power-Stor line of automated tape library systems and will also distribute the product line through its branches in Mainland China....AnexTEK profile, ...Quantum profile


San Jose, Calif. - May 20, 2002 - Alacritech®, Inc. today announced the general availability of its 1000x1F Single-port Server and Storage Accelerator, the industry's first Integrated Storage Network Interface Card (IS-NIC) for 1000BASE-SX optical Gigabit Ethernet networks.

"Alacritech has found a high demand for optical acceleration solutions among customers that are moving mission-critical data such as video, storage and secure federal files," said Barry Haaser, vice president of marketing, Alacritech, Inc. "This is the first accelerator on the market to offer direct optical connectivity to industry leading iSCSI switch and router solutions, and in independent testing has been verified to offer the same wire-speed performance at minimal CPU utilization as our other Gigabit accelerator products."

Alacritech's High-Performance Server and Storage Acceleration Technology Alacritech's 1000x1F Single-port Server and Storage Accelerator uses the company's standards-compliant SLIC Technology to offload network processing from software to silicon to achieve outstanding performance in servers, NAS and iSCSI storage devices. To resolve full offload-related issues such as low network throughput and limited compatibility and scalability, Alacritech's data-path TCP/IP offload enables data movement to be performed by a custom designed ASIC on the adapter, and TCP/IP connection management and error handling to be handled by the host software. ...Alacritech profile


SUNNYVALE, CA - May 20, 2002 - Finisar Corporation today announced the expansion of the 10-Gigabit Small Form-factor Pluggable (XFP) Module Group, Multi Source Agreement (MSA) association. The purpose of the group is to develop a common specification for multi-sourcing an application-agnostic, ultra-small form factor, 10 Gigabit per second (Gb/s) module for the telecommunications, data communications and storage area network (SAN) markets. The XFP association has experienced significant growth since its debut in March 2002, with 44 companies currently participating in the group. Finisar Corporation, who is one of the founding members of the XFP Group, successfully demonstrated an XFP prototype module at the Optical Fibre Conference in Anaheim, CA in March 2002. These transceivers are designed to occupy one-fifth of the space and dissipate one-half the power of current 10Gb/s modules. ...Finisar profile, ...XFPMSA.org


BOULDER, CO - May 20, 2002 - Exabyte Corporation (NASDAQ: EXBT) today announced that it has completed, subject in part to shareholder approval, the sale to private investors, lead by Meritage Private Equity Funds, L.P., State of Wisconsin Investment Board and Crestview Capital Funds, of 6.56 million shares of the Company's newly-created Series I Convertible Preferred Stock at $1.00 per share. The proceeds from the sale of the Series I Convertible Preferred Stock shall be applied to working capital requirements.

"This financing represents a major step in our restructuring efforts, strengthens our balance sheet and helps to position us to solidify a new bank facility with improved terms. In addition, the cash generated from this stock offering provides us the liquidity we need in order to move closer to achieving Company profitability," stated Juan Rodriguez, Interim President and CEO of Exabyte. ...Exabyte profile
Other news on this page

IDC Finds Three-Month Payback for Network Appliance Enterprise Content Delivery Networks

Dell Delivers Cost-Effective, Automated Data Backup System

Dantz Names Leslie J. Alvarez Chief Financial Officer

Hard Disk Drives Answer Call for Greater Storage Capacity in Consumer Electronics Products

NAS Device Backup Solutions Whitepaper Released Today by Datalink

AnexTEK to distribute and service Quantum's PowerStor Line of tape library systems in Taiwan

Alacritech Expands Family of High-Performance Gigabit IS-NICs

Finisar Announces the Expansion of 10Gb/s XFP Industry Association

Exabyte® Announces $6 Million Financing

earlier news (archive)
Fastest growing companies
Squeak! - The fastest growing profitable storage companies in the US - 2002.
For a pro, like Megabyte, picking winners was just a question of pulling the right handles.

Nibble: Is the Recovery Going to be Worse for Storage Vendors than the Recession?

In looking over the financial reports from hundreds of US storage companies in recent weeks, I couldn't help feeling a sense of unease. Those storage companies which are growing and making money are a rare breed.

Is the IT Recession really over?

Well, apart from some headline basket cases, it seems that way. There are more disk drives being shipped than ever before, and there are plenty of companies with very high revenue growth rates. The only problem is, that almost no one is making any money out of selling computer systems or storage. We're reporting daily on new rounds of VC investments going into storage companies, so that's another sign that the market is on an upward curve. I worry that we could be heading into a kind of doomsday scenario where demand for storage grows, and the amount spent on storage increases but still no one manages to make any profit.

Organizations do crazy things sometimes. In World War I, after years of trench warfare produced no gain in territory, the allies made the cynical calculation that if they continued to pour men into bloody battle at the same rate as the Germans, they would still win the war, simply because they could afford to lose more men.

There are more companies than ever fighting for market share in every product category. That's good for buyers because they can shop around for bargain products which exactly suit their needs. Most startup storage companies are finding that the new, unique product ideas which they thought up two to three years ago when writing their business plans, were also thought of by maybe a dozen or so other companies. And some of those other startups have already been acquired by bigger more established vendors. So the clock to gain market share is ticking.

The lesson of Dell can't be ignored. You can gain market share and be profitable by being the low cost supplier. But most companies haven't got the time to reach profitability, or become the most efficient producer, and will be tempted to use learning curve pricing on its own to crank up their revenue. That will only work as long as their cash keeps flowing.

As the size of the storage market increases, and the prize of winning market share becomes more tempting, there's a growing risk that companies will do crazy things equivalent to sending more troops over the top in WWI. It wasn't worth it then, and it's not worth it now. Managers in storage companies should look hard at what they're doing and start focusing more on profitability than revenue. Otherwise their companies won't have a future.

LSI Logic
LSI Logic Corporation (NYSE: LSI) is a leading designer and manufacturer of communications and storage semiconductors for applications that access, interconnect and store data, voice and video.

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