There are 2 reasons why EMC has been impacted with unique severity, and these factors have not affected other storage companies to the same degree.

• the Sun market. Possibly as much as half EMC's business has historically come from users of servers from Sun Microsystems. And, earlier this month, Sun reported a very bad quarter indeed, with revenue 43% down from the previous year. That's a much bigger adverse change than companies which make Intel Pentium based servers, and the root causes have been around a while. That closely coupled link worked well when Sun was growing, but it also works equally fast in the negative direction.

• the problems of being a successful incumbant. EMC's success in recent years did not go unnoticed, and more than 200 RAID systems companies and about 50 venture capital backed startups have been planning to grab a slice of that tasty looking market for the last year or so. I think that $600 million or more, of EMC's shortfall, has actually been carved up into several hundred small chunks that have been swallowed up by companies which have been working very hard to nibble away at EMC's market.
  
  EMC probably doesn't even list those companies as competitors, because individually they aren't big enough. But it's like the PC business in the early 1980's. IBM's major market share got whittled down into a lot of smaller chunks as soon as someone identified the PC market in their business plan. That was before they had Powerpoint of course. Today, there are hundreds of Powerpoint presentations out there which all have a pie chart saying "we're going to take 2% of EMC's business". When you add up all those 2 per cents, then, as in all such plans, they add up to more than the whole market. But they also have an impact on the company being targeted.

My view, for what it's worth, is that when all the data comes in for this quarter, it's likely that the storage segment grew a little bit. EMC has to learn to live in a more competitive market, and that's going to be tough. But it will still survive and thrive when the economy picks up again and it can go back to cherry picking customers.

• Storage Platforms Operations

• Open Software Operations

• Customer Operations