|
|
|
Who's
who in SSD? - Stec
by
Zsolt Kerekes,
editor - StorageSearch.com
- March 2013
Stec has been in the top 10 part the
Top SSD Companies for
most of the past 6 years. The company was an early pioneer in bringing the
advantages of adaptive
R/W flash IP into enterprise SSDs with what it branded as
"CellCare"
technology.
But - regarding its fortunes and outlook in the SSD
market - Stec has seen better times.
When Stec headed the list of the
Top SSD Companies in
the opening edition
of the series in early 2007 - the narrative around Stec was positive
expectations about products, technologies and business growth.
In
recent years- when Stec has been at the similarly high end of
these lists - one of
the factors driving readers to research Stec has been puzzling to
understand the mystery of a company whose star has faded - and whose IP in the
hands of other management might have been worth more. This is a narrative of
shrinking revenues and seemingly naiive failures of top management to
understand and invest in sales and marketing resources during a period when
the SSD market changed in character from a cool technical niche to a hot spot
bubbling towards the mainstream.
In the
past decade
total SSD market revenue has grown more than 100x bigger and the
viable competitor count chasing customers with Stec-like (or better) SSDs
has grown from less than 5 companies in 2003 to over 200 companies today. Yet
Stec's sales and marketing resources stayed miniscule - as if the company's
management had failed to notice the massive changes in the competitive
environment for SSDs.
2 of the stark external manifestations of Stec's
weaknesses in marketing are:-
- Stec's SSD revenue in recent years has shrunk to a small fraction of its
peak 4 years ago
- Stec was years late launching a product for the
PCIe SSD market which
was a natural product type needed by users in the enterprise SSD market.
|
 |
| .... |
| Stec's
ziggy zaggy meanderings in the enterprise SSD market - (2007 to 2013) |
This Stec narrative is assembled from
snippets of Editor's contemporary comments (made at the time) from past
quarterly editions of the
Top SSD Companies.
2007 Q3 - In this
quarter Stec's one time position as the oem with the fastest (announced) flash
SSDs for the enterprise server market was severely dented by
announcements of significantly faster flash SSD products from several
newcomers to this market segment including EasyCo, Fusion-io and Texas
Memory Systems.
2008 Q1 - In January
2008 - Stec announced it would be supplying its SSDs on an "exclusive"
basis for use in EMC's Symmetrix DMX-4.
2008 Q2 - Despite
significant growth in overall flash SSD market revenue in the first few quarters
of 2008 that cake was being divided up among a lot more companies. Stec reported
in May 2008 that its revenue had declined in successive quarters and the tone of
a press release in early July (about a new credit facility) still talking about
"anticipated" signifcant growth was starting to sound repetitious.
2008 Q3
- Stec offers SSDs in more form factors than any other company. Only
BiTMICRO and RunCore come close to this breadth of products. But a lot of
application slots means a lot of competitors too. So Stec is fighting battles in
more turf wars than anyone else. In August 2008 - following 4 straight quarters
of revenue declines, Stec reported 29% revenue growth for its most recent fiscal
quarter.
Can that last?
2008 Q4 -#4 - In
December 2008 - Stec issued new guidance for revenue in Q4 2008. Stec downgraded
its revenue guidance for the 4th quarter by 20% - which is unremarkable given
the current state of the economy. Notwithstanding that - Stec said its SSD
business was expected to have revenues in 2008 5x the level in 2007.
That is remarkable - given the strong competition in the overall flash SSD
market.
2009
Q1 - #7 - This is Stec's lowest ranking in 2 years. Although Stec has been
successful in getting its products designed into storage arrays by large storage
oems such as EMC - Stec's partners have not added enough value or IP to their
own rackmount SSD offerings. Consequently these "Stec inside" SSD
systems are weak in comparison to many competing systems which are faster or
cheaper (due to better leveraged SSD technology). In the view of
StorageSearch.com - Stec relies too much on market pull-through by partners
who are me-too or weak in the SSD space. Unless it invests more in its SSD
branding - its business is vulnerable to substitution and replacement by any new
SSD kid on the block with a faster SSD controller.
2009 Q2 - Stec has
been drip feeding reporters a stream of confirmations about design
wins - which most of us already knew about anyway. In June 2009 - an
article in The Register noted that Stec's Market capitalization had hit $1
billion. Also in June 2009 - an article in EnterpriseStorageForum.com posed the
question - Can SSD Maker Stec Be Stopped? It was a good question and deserved a
better analysis. So StorageSearch.com followed that up with its own SWOT
analysis - which can be seen in the company's profile page.
2009 Q3 - In July
2009 - Stec announced it had received $120 million order for its ZeusIOPS
SSDs from a single enterprise storage customer for delivery in the 2nd 1/2
of 2009. This followed an earlier announcement that the company has partnered
with a leading defense systems contractor to supply its MACH8 industrial SSDs
for integration into a platform designed on behalf of the U.S. Military as part
of a 12 month, $28 million supply contract.
In August 2009 - Stec said it will ship 6Gb/s SAS flash SSDs in both
2.5" and 3.5" form factors in Q4. Stec's new ZeusIOPS SSDs will
deliver 80,000 IOPS random read, 40,000 IOPS random write with transfer speeds
of 550MB/s read and 300MB/s write. Stec also said it's sampling a faster version
of its 3.5" FC compatible SSDs. Stec also announced a new policy of
offering MLC flash in so called "enterprise class SSDs".
Over many years Stec has earned a good reputation for shipping
boringly reliable, high-quality fast SSDs which its oem customers can install
and forget. As the performance gap between Stec and rivals has narrowed I would
have expected it to become vulnerable to its customers switching away to lower
priced products. Instead - Stec has been gaining from all the bad news stories
in the industry about badly designed and inadequately validated SSD products
shipped by other companies.
Each time an oem customer sees another flaky flash SSD news story -
that's another reason to worry about the dangers of using nouvelle SSDs. And
that is reinforced by the growing awareness that many engineers can't even rely
on their own benchmarks to filter and shortlist products they can depend on in
real applications. These growing uncertainties mean that Stec may not have to
worry unduly about Pliant Technology's long anticapted foray into SAS flash SSD
turf.
2009 Q4 - In this
quarter (2009 Q4) Stec was shipping the fastest 2.5" and 3.5" SSDs.
Both are SAS SSDs with 80,000 IOPS random read, 40,000 IOPS random write and R/W
transfer speeds of 550MB/s and 300MB/s respectively. Being at the top of the
performance class always helps to attract interest and the company's PR machine
continued to churn out stories about oem deals and partnerships.
Reputation for reliable performance (with no nasty performance black
holes or flaky product recalls) will be an increasingly important theme for
enterprise server buyers in 2010. This is an area in which Stec scores well. And
it may help the company retain its high margins - because the risks of choosing
the wrong SSD supplier can be catastrophic.
But there are problems in SSD Shangri-La. In November 2009
Stec disclosed that its biggest customer, EMC, hadn't sold as many of its SSDs
as expected - and will carry inventory into 2010. If this was a surprise to
anyone it's only because they didn't read my analysis (published April 1, 2009)
in which I explicitly warned about Stec's over reliance on partners like EMC who
were adding very little added value to their SSD offerings - and underperforming
in the rackmount SSD market.
A legal company called Brower Piven said it was considering a class
action lawsuit against Stec regarding what it called "misleading
statement(s) to investors" (earlier this year) regarding the state of
design wins and oem potential business related to Stec's ZeusIOPS.
2010 Q1 - Despite
fierce and growing competition Stec remains defiantly entrenched near the top of
any short list of potential SSD suppliers in these core market segments -
military and server. In February 2010 - Stec reported that its revenue for
full-year 2009 grew 55% to $354 million.
Stec used to be the company
which every other SSD company wanted to beat - owning (as it did for many years)
the top performance slots for HDD compatible server flash SSDs - and a sizable
chunk of the military SSD market too
2010 Q2
- Stec doesn't sell enterprise SSDs directly to users, instead its route to
market has been to rely on oems to design its SSDs into their systems - and wait
for the sales ramp to happen. The initial advantage of that approach (when the
SSD market was smaller than it is today) is that the company did not have to
invest in developing its own routes to market and related marketing
competencies. The disadvantage - in the current SSD market - is that the
company is vulnerable to being swapped out in design sockets. Additionally -
Stec is poorly positioned to acquire expertise about rackmount SSDs (an
important market in which its server SSDs are deployed and compete) - because
the company doesn't supply integrated solutions.
2010 Q3 - Stec
announced it is sampling a new 3.5" dual port SAS compatible
RAM SSD - the ZeusRAM
SSD - with 8GB capacity and under 23 microseconds average latency and internal
flash backup. RAM SSDs don't have the
"play it
again Sam... as time goes by" syndrome inherent in flash SSDs - because
they have genuinely low repeat write latency and can be 10x to 20x faster. In
some applications that's a difference worth paying for.
2010 Q4 - Stec
announced that MLC versions of its ZeusIOPS SSDs are being used in IBM's
Storwize V7000 (RAID systems).
2010 Q4 - Stec has
particular weaknesses in the enterprise acceleration market because it
does little or no effective marketing to the end users who actually buy their
products and relies instead on indirect marketing done by its partner oems - who
in the main - have lagged behind the top SSD companies in capturing the market's
imagination - and (as we have been finding out recently in various
Petabyte shipment
announcements) have not been doing as well as they thought in comparative
shipments either.
Stec used to be the company which every other SSD company wanted to
beat - owning (as it did for many years) the top performance slots for HDD
compatible server flash SSDs - and a sizable chunk of the military SSD market
too. The SSD market is much bigger now - and the agenda in different market
segments is being set by many different companies - rather than by any single
company.
If you try this thought experiment you'll see what I
mean. If Stec suddenly ceased making SSDs - then all its main customers would
have little or no problem adapting their designs to use alternative competing
products without negatively impacting competitive performance.
2011 Q2 - Stec has
been making flash drives for embedded applications for 15 years - but
although their SSD technologies have changed a lot in that time you could
easily be forgiven for thinking that the thinking behind their marketing
hasn't changed much since the mid 1990s. By which I mean - they still behave
as though they were swimming in an SSD pool of 5 sharks rather than
hundreds.
Nowadays many people who look at the markets which
Stec helped to pioneer learned their own SSD market education from competing
SSD companies - and they don't buy into the Stec implied concept of "trust
us - we're an SSD company and know best" argument which in the absence of
any other clear messages (or hard technical data) - has been the inferred
marketing groove which Stec has been stuck in for the past several years.
And
potential customers aren't impressed by the fact that EMC might have designed
Stec's SSDs into its storage boxes a few years ago - because they also know
from Stec's financial reports that EMC didn't sell them fast enough. And
anyway EMC isn't a leader in the SSD market - and could buy a different bunch of
SSDs - or
a different SSD
company - next week. EMC's endorsement or lack of it doesn't count for
much in the SSD world - because EMC is a long way behind the installed capacity
of SandForce or Fusion-io's various partners.
Instead what people
want to know are hard facts and better reasons why they should be looking at
Stec. And that analysis starts with comparing Stec to other companies. Some of
the questions I've been asked recently - have been.
- how does Stec compare to Fusion-io?
- how does Stec compare to SandForce?
- is SanDisk's acquisition of Pliant a big threat to Stec?
Stec does have a
good story
to tell - although why they've left it so long to begin talking about their
internal flash technology assets is a real mystery to me.
2011 Q3 -
2012 will open a new
chapter in high performance 2.5" SSD marketing - which can best be
described as the "enterprise MLC credibility wars". The
winners will be decided as much by
marketing as by
technology. Stec is a major participant in this debate - which I have
described in more detail in
sugaring MLC for
the enterprise.
2012 Q1 - Stec
continued to frustrate and astonish investors and analysts by reporting 38% year
on year decline from the year ago quarter - at a time when the enterprise SSD
market appeared to be in stampede growth mode.
I said to one (of
many) such SSD investment analysts who sounded me out on Stec's business
performance - "I've been talking regularly to Stec about the SSD market for
about 8 years. So my frustrations in what they have'nt done and lost
opportunities are bigger than those of any investors. (Despite that)...I think
Stec could still get much higher multiples of its current revenues than it has
achieved in recent quarters but it needs better marketing to do this."
2012 Q2 - I said in
our main SSD news pages that the company had "improved its enterprise
marketing" and that "the company has doing new things which it didn't
do before - rather than just doing the same old things better."
That was after years of eviscerating comments about the company's
routes to market and marketing. So if you believe that marketing can have a
beneficial effect on company performance you should expect to see better results
from the company in the coming year (compared to what it would have
achieved otherwise.)
In this quarter - Stec announced the general availability of the
company's EnhanceIO SSD Cache Software for Linux and Windows environments.
I'm not convinced about the long term sustainability of a hardware SSD
maker offering their software for use to accelerate competing SSDs. And I know
that many other SSD ASAP
products provide better performance - because they use more complex hot spot
algorithms. Nevertheless - Stec has opened the
SSD software gate as a
new portal for customers to do business with the company. And that will lead to
new business opportunities.
2012 Q3 - Although
Stec's reputation suffered in this quarter from miserable revenue shrinkage and
a "temporary" step down by its CEO - the company continued to advance
its belated marketing efforts into
PCIe SSDs and
software.
Growing
industry awareness of the advantages of
adaptive R/W
DSP flash IP - a technology
pioneered within the
enterprise SSD context by Stec - may have been a positive factor in reassessment
of the company in critical segments.
2012 Q4 - In this
quarter STEC announced that its revenue for the quarter ended September 30 was
57% lower than the same quarter 3 years before. In contrast to this - during
the same 3 year period the available SSD market had grown about 8x bigger.
2013 Q2 - In this
quarter
STEC rebranded
itself as sTec and announced its entry into the rackmount SSD market with
the launch of an iSCSI
COTS array. Important details were
vague and missing
and I didn't get any replies to my questions about the product.
Also
in this quarter - WD
announced that it had agreed to acquire
Stec for approximately
$340 million. On closing - Stec would be absorbed into
HGST.
| | |
| .... |
|
|
Stec's formative SSD years
Like
many other memory companies in the late1990s Stec's product range included ATA
flash drives - but its earliest standard SSD product was a rugged
SCSI SSD launched in
June 2001.
Thereafter Stec strengthened its SSD technology and
established its core SSD business using acquisitions -
Memtech (a well
established military SSD company - acquired 2005) - and
Gnutek (a startup high
IOPS enterprise SSD maker - acquired 2006).
But Stec's early SSD
history is more complicated than that - because in 1994 it had started an oem
memory products business called SiliconTech which was spun off as a separate
business in 1998 headed by the (then) newly recruited from
SanDisk - Michael
Hajeck who later - with
Dave Merry
(coming in from
Centennial
Technologies) and John
Conklin together cofounded
SiliconSystems in
October 2002. SiliconSystems came to the attention of my readers in 2004 and
was acquired - in 2009 - by
Western Digital.
more
recently
In August 2009 - an
article in the Shanghai based 21st Century Business Herald (Chinese
language)
discussed
Stec's share price and competitive environment, quoting many
SSD analysts,
including the editor of StorageSearch.com.
In February 2010 -
Stec reported
that its
revenue
for full-year 2009 grew 55% to $354 million.
In
May 2010
- Stec confirmed that
its revenue for the 1st calendar quarter of 2010 decreased
39% (to $38.8 million) compared to the year ago period. Poor results
had been anticipated and flagged in guidance due to the company's over strong
dependence on a single oem customer -
EMC.
Also in May
2010 an article in
TheRegister.co.uk
suggested that Stec
may soon launch a PCIe
SSD to compete with the likes of Fusion-io and Texas Memory Systems.
That's not a real surprise. The enterprise server acceleration market is Stec's
biggest market. And the PCIe SSD market has - in less than 3 years -
established itself as the most important
enterprise SSD form
factor - based on SSD search volume.
In August 2010 -
Stec announced
details
of 2 technologies the company is using to improve
data integrity
and reliability in
its enterprise market MLC flash SSDs. These are called CellCare and S.A.F.E.
In September
2010
Stec announced it is
sampling a new range of fast enterprise optimized
1.8" and
2.5"
SATA SSDs - called
the
MACH16
which is available in SLC and
MLC versions for
commercial and industrial
temperature operation. The SLC models have upto 200GB capacity, R/W speeds of
240Mbytes/sec and 190Mbytes/sec respectively, average latency of 50 microseconds
and 30,000 / 10,000 sustained R/W IOPS.
Also in September 2010 Stec
announced
it is sampling a new 3.5"
dual port SAS
compatible RAM SSD - the
ZeusRAM SSD - with
8GB capacity and under 23 microseconds average latency and internal flash
backup.
RAM SSDs don't have the
"play it
again Sam... as time goes by" syndrome inherent in
flash SSDs -
because they have genuinely low repeat write latency and can be 10x to 20x
faster. In some applications that's a difference
worth paying for.
The
1st 3.5" RAM SSD featured on these pages - was the
MegaRam-35 (in
June 2002) which was a parallel
SCSI SSD from Imperial
Technology. A year later in 2003 -
Curtis marketed a 3.5"
fibre-channel RAM SSD - the
HyperXCLR - which
for many years held the speed records in that form factor. The Curtis unit is
still available as too is a similar product from
Density Dynamics.
In October
2010 - A new edition in our SSD Bookmarks series
was published with suggestions
by Scott Stetzer, VP Marketing Stec.
In March 2011 -
Stec was one of the many
companies named as potential enterprise SSD competitors in
Fusion-io's
Form
S-1 registered with the
SEC for a proposed IPO. The document also
includes a scholarly assessment of the state of the enterprise SSD market, key
competitors and risk factors. This makes better reading than many
SSD analyst press
releases and blogs.
In May 2011 - Stec announced it will
transition the hardware used in its high performance
ZeusIOPS (2.5" and
3.5") SSDs from a
dependence on FPGAs to ASICs. And the same ASIC design will be used in
new PCIe SSDs later
this year. Stec also announced that its revenue in the most recent quarter
was back in alignment with the growth rates for the enterprise SSD market -
following a decline in the preceding year attributed to over stocking by its
biggest customer
EMC.
In August 2011 -
Stec
announced
it is sampling a new software SSD ASAP product - called EnhanceIO - a
cross-platform cache solution that works with any SSD to accelerate enterprise
applications, however, it is optimized for Stec SSD devices. Stec has also
started sampling its previously unveiled PCIe SSD family.
In November 2011 -
Stec started
sampling a new
high endurance
MLC SSD - based on its proprietary
CellCare technology
- the new ZeusIOPS
XE (Extreme Endurance) is a 6Gbps SAS SSD family, available in
1.8",
2.5" and
3.5" sizes (300GB
or 600GB) and supports at least 30 full capacity writes per day, every day,
for 5 years. Latency is 50 microseconds max. Sustained R/W throughput is upto
500MB/s and 275MB/s respectively and random IOPS is upto 38,000 8K (70R/30W).
In February
2012 -
Stec
reported
that its revenue for Q4 2011 was $58 million, a decrease of 38% from
the year ago quarter and a decrease of 20% from Q3 2011. Revenue for the
full-year 2011 was $308 million, an increase of 10% compared to 2010.
In
June
2012 - Stec
announced
the general availability of the company's
EnhanceIO SSD Cache
Software for Linux and Windows environments with pricing starting from $295
and $495 (per server) for a 1 year subscription.
In December 2012 -
Stec
announced
that the company's interim CEO, and former CEO and founder Mark and
Manouch Moshayedi have reduced their salaries to $1 to help the
company reduce its operational costs.
In
June 2013
- WD announced that it
had agreed to acquire
Stec for approximately
$340 million. Stec will be absorbed into
HGST.
In September 2013 -
The acquisition of Stec by WD closed - and the process of integrating it into
WD's enterprise SSD business -
HGST began. |
| . |
| earlier editor's (who's who
in SSD) comments:- October 2011 |
Stec is one of the industry's best known,
widely respected and longest established makers of flash SSDs. (See history
notes below for more about Stec's complex SSD roots.)
Stec has
appeared regularly in StorageSearch.com's
fastest SSDs list
and in every one of the past quarterly editions of the
top 10 SSD companies.
Despite its strong SSD heritage, however, the company has in my view
had weaknesses in its business plans and routes to market - which I have
commenetd on in previous years. These are symptomatic of classic "engineering
led" high tech companies -who believe that developing technology and
talking to engineers in a bunch of customer companies is all they need to do
to grow and maintain their business. When competitors come along with products
which are nearly as good, as good, cheaper or even better - these tech-led
companies often wake up too late and realize that they haven't invested enough
in their business channels and brand marketing - and that their previous
leadership position can be blown away in a few quarters. Contrary to their
beliefs (established when their markets were smaller) they don't know who all
their potential customers are - and they can't fix sales blips by arranging
customer meetings for their managers and technical gurus - or presenting a few
more white papers.
Stec offers SSDs in more form factors than any
other company.
Stec has many competitors in the
military,
industrial and
enterprise SSD markets (PCIe
SSDs, SAS SSDs
etc). To achieve its fair share of enterprise SSD market growth - in my view
Stec has to offer credible alternatives (which are fast and competitively
priced) to these companies.
Stec's toughest competitors in the
traditional 2.5" etc enterprise SSD markets are:-
- SanDisk (Lightning
range acquired from Pliant) - if SanDisk can get its marketing act together and
convert from being a consumer company to an enterprise company. Frankly I have
some doubts about that.
- BiTMICRO - whose
new controller architecture looks like the fastest in this segment (if they can
ship it as promised in 2012)
Stec's toughest competitors in the
PCIe SSD market are:-
- Fusion-io - who
dominates the PCIe SSD
market and mostly sells to big server oems. Stec was 4 years late entering the
PCIe SSD market - and has missed out on this important source of enterprise SSD
revenue.
- OCZ - who hinted in
its December 2011 earnings report that it is getting good design wins for its
enterprise PCIe SSDs
Stec also has indirect competitors in the
rackmount SSD market.
That's because if Stec's rackmount SSD customers like EMC lose market
share to companies like Violin
and Texas Memory Systems
- then there's less business to be had for Stec too.
Stec used to be
the company which every other SSD company wanted to beat - owning (as it did for
many years) the
top performance slots
for HDD compatible
server flash SSDs - and a sizable chunk of the
military SSD market
too.
The SSD
market is much bigger now - and the agenda in different market segments is
being set by many different companies - rather than by any single company. If
you try this thought experiment you'll see what I mean. If Stec suddenly
ceased making SSDs - then all its main customers would have little or no
problem adapting their designs to use alternative competing products without
negatively impacting competitive performance. | | |
| . |
 |
| |
..... |
|
|
| .. |
 |
| .. |
|
|
| .. |
SAS SSDs
2.5" SSDs
PCIe SSDs
military SSDs
industrial SSDs
the Top SSD companies
adaptive R/W &
DSP IP in flash SSDs
SLC to XLC - flash
in the enterprise - 2004 to 2016
CellCare - resetting the
assumptions about flash endurance
90%
of enterprise SSD companies have no good reasons to survive
|
| ..... |
|
|
| ..... |
Stec to be acquired by WD
what
will happen to Stec's military SSD business? |
Editor:- June 24, 2013 -
WD today
announced
it has agreed to buy Stec
for approximately $340 million. Stec will be acquired by WD's subsidiary HGST - which is
already active in the enterprise SSD market.
Editor's comments:-
Stec is a company which knew how to design some types of enterprise SSDs - but
didn't have the know-how and channels to sell them and adapt them better to
market needs.
WD knows how to sell drives - but even with its HGST
subsidiary - only has a weak SSD product line. So in that sense there's a good
fit.
In the hard
drive world WD has often talked in the past about the importance it attaches
to business value and efficiency. And if you look at the price it paid for Stec
- the valuation it has placed on Stec - with its ongoing business, people and
brand was probably less than half of what Stec's controller IP (on its own)
would have been worth a year ago.
My guess is - it's only because WD / HGST already has enough people
with a good understanding of SSD IP that they can tolerate the high risk of
acquiring Stec - and filtering out the good bits of technology while having the
focus to discard dead-end products and pie in the sky thinking.
It's easy to see how enterprise users would benefit from this acquisition - but
less clear is the future of Stec's
military product
lines. The acquisition related
faqs document
(pdf) doesn't mention Stec's non enterprise SSD products at all. It merely
indicates that the status of all products will be reviewed in the period
after the acquisition closes.
My guess is that any company acquiring
Stec for its enterprise assets would probably divest the military SSD product
lines. (This isn't a new idea. I first touted it in a much earlier round of
speculation about Stec's future.) Another possibility is that the military
business might be assisted to do a management buy-out.)
Later:-
Following STEC's acquisition by
HGST (which completed
in September 2013)
many of STEC's embedded
industrial
flash products were discontinued.
The problems for SSD buyers in
such situations are discussed in my article:-
BOM control, EOL and the
mythical "standard" industrial SSD | | |
..... |
| Here's an earlier
assessment of Stec - from June 2012 |
Stec - is 1 of more than 200 SSD
companies in these SSD market sub-segments:-
military SSDs,
fast purge SSDs,
SAS SSDs,
FC SSDs,
SATA SSDs,
3.5" SSDs,
2.5" SSDs,
1.8" SSDs,
RAM SSDs,
PATA SSDs, industrial SSDs,
SCSI SSDs,
SSD ASAPs,
SSD software and
PCIe SSDs.
In a market where reputations for having the
fastest SSDs can be
shattered in days, Stec has established itself a reputation for designing
high reliability
flash drives which stretches all the way back to the
1990s.
Unfortunately the company's enterprise SSDs have also acquired an
image of being expensive relative to competing products from newer
suppliers.
Over a year ago Stec told me it hoped to change all
that with its new generation of SSDs which leverage its
CellCare technology
to extract unusually high endurance and
data integrity
from low cost consumer grade flash.
But since then the
SSD flash health care
market is now crowding up into double digits with claims from competing
companies who
also say their SSD controllers are N times better than the so
called "industry standard" at making consumer flash endurance last
longer in enterprise apps using
adaptive DSP
technology. So even while all these claims have their own merits - the
competitive advantages of being just 1 of a small group of companies which were
able to do this even a year ago - have largely evaporated. Every good idea in
the SSD market that can become a big business soon attracts many competitors.
For
many of its investors Stec has been a frustrating and exasperating company in
recent years because its SSD revenue effectively halved in the same 2 years that
the SSD market more than doubled. I've discussed these problems in numerous
articles and also with investors and with the company too.
| | |
| .. |
 |
| .. |
|
|
| .. |
| the SSD thoughts of Stec's "interim"
CEO |
Editor:- January 8, 2013 - Stec's definitely "interim"
CEO, Mark Moshayedi, tells readers about the customers who initiated
the designs of its main enterprise SSDs in an
interview
published today on StorageNewsletter.com - in which, on the subject
of being an acquisition target, he says - "Why would Dell be
interested in acquiring an SSD company?
Seagate haven't
contacted us.
Western Digital always
tries to buy things for nothing."
Editor's comments:- this
is a great scoop by StorageNewsletter.com 's editor Jean-Jacques
Maleval - and because the quotes are so long - you can draw your own
conclusions about some of the questions discussed.
Do you remember one
of my earlier home page blogs about the
competitive advantage of
SSD design efficiency? This is one of Stec's strengths. And here's what
Mark Moshayedi has to say on this subject
"Certain
companies that we compete with sometimes spend
120% of what we spend in the flash side of it. That's because of the way
they do the design and the
over-provisioning
to meet certain customer requirements."
On the other hand
Stec's corporate failure to invest adequately in sales and marketing
and business intelligence resources over many years are also demonstrated in
this article.
For example - when talking about
Fusion-io - Mark
Moshayedi admits - "From what I understand today, Fusion-io has 180 sales
people that just sell to enterprises. We have today less than 10."
Overall
I think the interview will make interesting reading for Stec observers, and
will confirm many things they already suspected.
When you're a
stakeholder in an SSD company - the people who manage the company - and their
outlook on this uncertain market - are just as important as the technology.
...read
the article | | |
| .. |
despite all
those design wins...
still no rebound at Stec |
Editor:- November 7, 2012 - Stec yesterday
announced
that its revenue for the quarter ended September 30 was $42 million - 42%
lower than the year ago period (and 57% lower than the same quarter in
2009).
The company's guidance for the next quarter is in the "range
from $36 million to $40 million".
In the related conference call
Stec said that it had 3 customers each of which accounted for over 10% of
revenue. One of these was an end user which builds its own systems for cloud /
web apps - (SSD dark
matter segment).
Stec also said it will invest more resources
into sales and hopes that next year over 50% of its revenue would come from
large enterprise end
users. The key product areas in which it pins these hopes are
PCIe SSDs and
SAS SSDs.
Stec
said that customers are telling them about their horrific
endurance
experiences with using consumer SSDs in enterprise apps and saying they want to
buy in future from a "real SSD company."
Editor's
comments:- in August commenting on Stec's previous quarter I said that
while I was pleased to see many signs that the company had made visible changes
and improvements in its marketing - "years of neglect won't be cancelled
out in 1 month or 1 quarter."
Stec's latest results would have
been even worse if they they hadn't already reached out to more people in the
SSD market with their marketing efforts earlier this year.
So much of
the management's time - for as long as I can remember - is spent wooing and
placating shareholders and analysts and cleaning up legacy legal challenges -
you have to ask - is there enough energy and talent going into understanding
what's happening in the SSD market?
Even before their star faded - they
were an inward looking company with little idea of who their competitors were
and the significance of what other SSD companies were doing.
You don't
have to look far for evidence.
This text below is the meta description
tag on
Stec's own home page - which tells
Google's readers that - "Stec is the leading global provider of
Solid State Drive (SSD) solutions tailored to meet the high performance and
reliability needs of original equipment manufacturers."
I think
it's time to change "the leading" to "a leading" - if the
company is to retain credibility. | | |
| .. |
| "In July 2009
- Stec announced it had received $120 million worth of orders for its
ZeusIOPS SSDs from a single enterprise storage customer (later confirmed to be
EMC) for delivery in the 2nd 1/2 of 2009." |
| SSD market
history | | |
| . |
| Stec has improved its
enterprise marketing |
Editor:- June 18, 2012 - Extrapolating too far
from small data samples is dangerous - and the warnings I give about this in the
monthly real-time updates to the
quarterly Top SSD
Companies List - takes up almost as much space as the list itself.
But
when - what appears to be - a small movement for a company in the top 5 end of
the list is accompanied by a narrative of significant market activities - then I
think it's worth sticking my neck out and mentioning it.
So I'm
going to say something positive about Stec - and specifically about the
way they interact with the SSD market via their routes to market and general
marketing.
Long time readers of the mouse site (as well as investors)
have for the past few years seen this company lose its way through what I
interpreted as being an outmoded way of doing business - which was
suboptimum for the enterprise SSD market. As a result of those factors (over
reliance on too small a customer base, being difficult to do business with, and
being out of touch with enterprise user adoption trends such as
PCIe SSDs) Stec's
quarterly SSD revenue approximately halved in the 2 year period from early 2010
to 2012 - at a time when the available enterprise market quadrupled.
I've
written more than enough about that in the
past and am
not going to repeat the analysis here.
What's been different about
Stec's marketing in the past few months is that the company has doing new
things which it didn't do before - rather than just doing the same old things
better.
In the past few months ads for the company's enterprise SSDs
have started to appear on various websites - although Stec has never been
an advertiser on StorageSearch.com. - 2012 was our 13th year running
enterprise SSD ads.
Another factor is that Stec has gotten into the
SSD software business.
And if you want users to download your software - then you have to make yourself
more approachable.
These little factors are necessary hygiene factors
for business success in today's enterprise SSD market. Although they aren't
sufficient.
My brutally harsh perspective of Stec - reflected in my
editorial and market analysis in recent years - has been that the company was
at one stage 5 years behind the curve when viewed from an enterprise SSD
marketing perspective compared to its competitors. The company survived -
because in some aspects of its flash management technology - as applicable to
enterprise SSDs - it was a few years ahead of its competitors. Although that
lead has evaporated
now.
The business steps the company has taken recently - have moved
it forward from being an electronic component biased SSD company into an
enterprise systems oriented SSD company.
SSD readers are reacting to
these differences too - and that's why Stec looks like it is nudging back up
towards the sharp end of the top SSD companies list.
5 years ago - Stec was
#1.
The
SSD market is much
more competitive now. Wherever it ends up - these search stats indicate that
Stec - competing with itself - is on a better course now than it has done for
many years. That should bode well for the company's long term future outlook
too.
PS - added November 6, 2012 - after Stec reported revenue
42% lower than the year ago period.
Stec's results would have been even
worse if they they hadn't reached out to more people in the SSD market with
their marketing efforts earlier this year.
So much of the management's
time - for as long as I can remember - is spent wooing and placating
shareholders and analysts and cleaning up legacy legal challenges - you have to
ask - is there enough energy going into understanding what's happening in the
SSD market?
Even before their star faded - they were an inward looking
company with little idea of who their competitors were and the significance of
what other SSD companies were doing. | | |
| . |
| Stec enters the SSD caching
software market |
Editor:- June 6, 2012 - Stec today
announced
the general availability of the company's
EnhanceIO SSD Cache
Software for Linux and Windows environments with pricing starting from $295
and $495 (per server) for a 1 year subscription.
Stec says its SSD
cache software can used with any vendor's
SAS,
Fibre Channel,
PCIe or
SATA SSD.
In addition, a Linux version of EnhanceIO SSD Cache Software, based on
Facebook's Flashcache
caching module, will be made available under a general public license
(GPLv2).
"As one of the original architects of Flashcache, I'm extremely
pleased to see this technology being enhanced and supported by Stec in their
EnhanceIO software," said Mohan Srinivasan, software engineer at
Facebook. "Flashcache has proven to be an invaluable tool for accelerating
application performance at Facebook."
Users can choose from a selection of caching schemes and block sizes
to suit their preference and SSD's capabilities. Stec stores the metadata for
the cache in system DRAM rather than in the SSD. The DRAM required for the
cache is 0.1% of the cache size so a terabyte of SSD cache requires about
1GB of DRAM support. Product support tools include a profiler which can collect
user data and suggest the best policy option parameters for the cache setup.
Editor's
comments:- irrespective of the technical strengths and weaknesses (and
pricing model) of this new product compared to other competing
SSD ASAP / caching
offerings - some questions immediately spring to mind. |
 |
How serious is Stec about
making this software work as a standalone product? And if it becomes successful
will the company be tempted to bundle it free with its own SSDs? | | | |
| .... |
| "Only 2 other
companies have anything close to our DSP SSD technology - Anobit and Stec. I was relieved
when I heard that Apple had acquired Anobit - because that effectively
removed their technology as a potential competitor in the enterprise market." |
| John Scaramuzzo, President -
SMART Storage
Systems - talking to StorageSearch.com in February 2012. | | |
| .... |
| don't all PCIe SSDs
look pretty much the same? |
When you look at the
photos and headline specs for high speed PCIe SSDs - it's easy to come away with
the impression that they all look the same and have about the same performance.
After
all - how different can they be?
But don't let the experience of the
2.5" SSD market -
in which clusters of consumer SSD vendors use the
same or similar
controllers and hover
close together inpopular
(consumer) performance rankings - give you the wrong idea about
PCIe SSDs.
In
this market the performance limits and capabilities of the SSD aren't set by an
old hard disk interface
and package limitations.
In the PCIe market the products you get are
limited only by the imagination of the designers - tempered by the guesses of
marketers who are trying to predict the optimum (most salable) features for an
ideal SSD. |
|
| | |
| .... |
| SSD uncertainty -
what's the best eMLC? |
Editor:- July 25, 2011 - Stec is lifting the
veil off how it manages MLC flash inside its enterprise and industrial SSDs -
as part of a new positioning gambit that warns customers - not all so called
enterprise MLC SSDs are created equal.
You're thinking -
isn't it all MLC management in enterprise SSDs pretty much the same? - Just a
variation on what
SandForce and
Fusion-io already do?
(Only Stec is more expensive than SF, and not as fast as FIO...)
That's
what I thought too - but I was wrong.
This will be the start of new
enterprise MLC branding
wars in which SSD designers and memory makers battle it out to try and
convince you... |
 |
... that their own (very
different) ways of doing enterprise MLC SSDs - as they head towards 1X
nanometer flash - is better than all the others.
...read the article | | | |
| . |
|
| ... |
|
| |
