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User Value Propositions for buying SSDs

Updating my SSD market adoption and explaining - why users will buy SSDs

by Zsolt Kerekes editor - - November 2005

This is a long article - which provides a framework which will help you understand SSD market adoption upto 2020. Here are the 6 SSD market cases discussed.
  1. hostile environments
  2. server acceleration (SSD-CPU equivalence)
  3. road warrior and featherweight notebooks
  4. high reliability embedded
  5. low cost SSD bulk storage / enterprise HDD array replacement (added 2010)
  6. tiered DRAM replacement in servers (added 2015)
See also this (later) article:- are we ready for infinitely faster RAM?.

User Value Propositions for buying SSDs

the original text which was published here on - November 2005

I was the first storage market analyst to publish a report saying that the enterprise SSD market had the potential to reach $10 billion annual revenue. I described the economic and technical factors in an article in 2003 (when the entire SSD market revenue was under $100 million).

So why are most IT editors and analysts today (in November 2005) still so wrong about the potential of SSDs? - and prefacing every discussion of SSDs with a superficial analysis which compares the cost per byte of storage between flash and hard disk drives?

There's a simple explanation.

They really don't understand the solid state disk market.

Magnetic versus flash media cost comparisons provide the wrong answer to the wrong question. And are far removed from why the SSD market is racing to become a multi billion dollar market seemingly in blithe ignorance of the cost per byte proposition. This article tells you what's important to users and the main applications in which SSDs are already being used and new applications where they will be used in the future. is recognised by most SSD manufacturers as a leading authority on recent developments and changes in the emerging SSD market. This article updates our earlier SSD market penetration model, first published in 2003. It also predicts and describes the emergence of some new applications and markets.

I first started using SSDs in computer systems over 25 years ago, and have tracked the market as a publisher for over a decade. The STORAGEsearch model and insights presented here are based on our own original market research, discussions with SSD oems, analysis of reader trends, discussions with readers and reading (or publishing) much of the original literature related to this market in the last 5 years.

Before presenting our market model - let's go back to the premise in this article's title above - "Why are Most Analysts Wrong About Solid State Disks?"

One simple answer is that analysts and market researchers have nearly always failed to anticipate, recognise or predict the emergence of new disruptive technology markets. This phenomenom is well documented in marketing text books.

The SSD market is no different in that respect to any other disruptive market. Analysts tend to be good at predicting incremental changes in established markets where there already is plenty of data about revenue, users and product shipments. It's expensive to collect that data, and someone has to pay for it. In the high-tech market when product niches are below about $500 million (using 2005 values) - it is not economic for traditional big name market researchers to collect any data. In the absence of sponsors and market research which asks users why they are buying new technologies - market research companies fall back on using traditional analysis techniques - usually applied to the wrong parameters.

In the SSD market - the wrong parameter to look at is - the price per byte of solid state disk storage (flash or RAM price) and compare that to the price of rotating magnetic media in hard disk drives. After quoting publicly available price points - the sages wisely pronounce that the projected graphs may cross and reach parity at some distant time in the remote future but the time has not yet come - and they can't see what all the fuss is about.

Before progressing to our own market penetration model - I thought it would be instructive and amusing to see how that kind of traditional analysis - which looks at the wrong data from the wrong point of view - would have predicted the outcome of some earlier disruptive technologies:-
  • the car:- was a disruptive technology in the 20th century which mostly replaced walking, the horse and the train as a method of transport. Yet if you look at the cost to buy, or the cost to own, or the cost per mile - then the roads today should be filled with motor bikes and not cars. Cars cost more. Are we all nuts?

    The customer value proposition is that cars offer greater flexibility and comfort in personal transport. Even though cars are mostly used by a single driver, they offer the flexibility of being able to carry more passengers. And even though motor bikes offer lower cost when carrying 2 adults (and 2 bikes carrying 4 passengers costs less than a car too) most users still prefer to buy cars for everyday transport. (Bikes and their leathers, in the US and western Europe have become a fashion / lifestyle statement - but that's outside the scope of this discussion.)
  • the original IBM PC:- the killer app for the early PC market was word processing. But in the early 1980s a PC with printer cost about 20 times as much as a portable typewriter and about 4 times as much as a heavy duty electric typewriter. PCs were also more complicated to operate. Looked at on a pure cost to buy basis - the PC market should never have taken off in the document market. However, as we all know - typewriters became extinct. Who could have predicted that?

    The customer value proposition was that users could standardise documents and the flexibility of PCs was judged superior to that of typewriters. Although in a rear guard action - office based typewriters did start to sprout floppy drives and editing screens - the PC is the tool which won.
  • the Apple iPod:- why would any sane person in 2004/5 buy an iPod to play music - when a portable CD player or cassette tape player costs less than 1/4 of the price - and doesn't need a PC to set it up?

    As we know, tens of millions of users have bought iPods and the market for similar technology portable music players will soon pass the hundreds of millions mark. So the cost per player is not the important issue in the minds of the user.

    The customer value proposition of the iPod is that it delivers a more flexible and rewarding entertainment experience compared to listening to the same small number of CDs (or tapes) over and over again until you are bored, or the cumbersome alternative of carting around a crate of music media.
Let's move on to the SSD market and see why cost per byte analysis has failed to predict or explain the emergence of a multibillion dollar SSD market. SSD Market Penetration Model (Nov 2005)
Type Application Narrative
1 Hostile Environments

image shows mouse building storage - click to see industrial SSDs article
industrial SSDs

military storage directory and news
military SSDs
This was the earliest use of SSDs.

In the late 1970s manufacturers of industrial control systems used solid state disks to hold programs - because the hard disks available at that time were expensive and unable to operate reliably in a factory environment (vibration, temperature and power fluctations being the main stress points). For similar reasons SSDs were used in military embedded systems. Competing with SSDs specialist military manufacturers designed cannisters which reduced the amount of vibration transmitted to hard disks, enabling their deployment in some vehicle and mobile applications, and the durability of HDDs improved during the 1990s. But there are many environments where HDD media itself cannot survive - such as extremes of high and low temperature. By the end of the 1990s flash solid state disks had started to replace HDDs in most miltary applications due to superior operating temperature, lower weight, lower power and faster performance.

Today one of the iconic applications for mobile consumer storage is portable music players such as Apple's iPod - in which HDD or flash SSDs are used depending on the price point. But much higher volume markets where SSDs will dominate, and where mobility and environmental factors are important include:- cell phones, in car entertainment and navigation systems and cameras.

The customer value proposition in Hostile Environments is that SSDs operate in environments in which hard disks are unsuitable, and where SSDs have superior weight, power, reliability or other key attributes.

An excellent discussion of how the "floor price model" affects the interplay of HDD and flash in consumer applications is presented in this article:- Flash Memory vs. Hard Disk Drives - Which Will Win? written by Jim Handy Semico Research
2 Server Acceleration

the fastest SSDs - click to read article
the fastest SSDs
As long ago as the mid 1980s, engineers (like me) using SSDs in military systems for type 1 applications (above) noticed that they also got speedup benefits from using SSDs compared to using HDDs.

Some RAM based SSD products were launched in the 1980s specifically to offer speedup (instead of environmental survivability). But as hard disk interfaces got faster, and cache became more common - most early SSD products aimed at the server acceleration market had died out by the early 1990s.

In the period 2000 to 2005 - SSDs started to become cost effective and viable in high end commercial server applications. In the next several years the arguments for using SSDs for server speedup will become more compelling and the market will change from SSDs being a rare technical deployment in 2005 to being a commonplace item by 2008.

One way of thinking about this concept in computer architecture is - SSD CPU Equivalence.

For a wide range of applications if you take a black box approach and analyze the overall application performance of a computer system - you would not know whether that system had more CPUs with hard disks or less CPUs with more SSDs.

In most multi-user database driven applications today the factor which limits performance is not server MIPs but random disk access speed. In the past 20 years disk throughput (Megabytes per second) has increased by a factor of x100 (from 1MB/s in 1986 using 5.25" SCSI disks to 100MB/s sustainable in 2005 using 3.5" SAS disks) but the random access time has improved by a much smaller rate of only x5 (3,000 RPM disks in 1985 versus 15,000 RPM disks in 2005.)

In the same 20 year period - processor clock speeds have risen from 33MHz to over 3GHz. The data bus widths have increased from 32 bits to 64 bits and new processor chips include from 2 to 8 internal processors. That's a x400 to x1,600 increase in data demand for a typical server.

Many users have discovered that when they need faster performance they reach a bottleneck or ceiling which cannot be improved by simply adding more processors or memory. But by adding high speed SSDs to critical storage segments they can get application speedups from x2 to x40. SSDs can deliver more than 1,000 times the random access speed of hard disk based systems. If deployed correctly users can speed up their applications and save money by neeeding less servers, less software licenses and less systems to support.

The customer value proposition of Server Acceleration is that SSDs double the speed of enterprise server applications at a price which is much less than buying another 10 to 100 servers.

The user adoption of this technology has been slower than the technology permits for the following reasons
  • most users are not computer architects, and have no idea of what performance they should expect from their systems
  • server manufacturers have a disincentive to promote knowledge about SSD accelerators - because this would result in them selling less servers - and getting a reduced revenue stream
  • most SSD vendors have been small or medium sized companies which didn't have the marketing muscle to educate users about the technology
In the present market - this type of sale is a technical sale - in which a user hits a performance problem which can't be solved by their server supplier. In desperation and in a sceptical frame of mind they evaluate SSD technology - and are usually amazed by the results.

65% of SSD users surveyed said "It greatly exceeded expectations - I advocate others to try"... from the SSD Buyer Market Preferences Report)

The transition from a niche to a mainstream market will be helped by the following factors.
  • Better user awareness - due to publications like this one, and better marketing and education by SSD vendors.
  • Server oems will start using SSDs as an engineering fix for big customers who are disappointed by the performance of new generations of servers. The mismatch betwen server IOPs and hard disk IOPs will become more apparent with 2 core and 8 core processor chips. Customers will want to know why their new servers aren't any faster than their old ones. Eventually, faced with declining server volumes, server oems will start to see selling SSDs as a revenue growth opportunity instead of a revenue reducing one.
See also:- RAM versus Flash SSDs - which is Best?
3 Road Warrior
Featherweight Notebooks
(weighing under 1kg / 2lbs)

M.2 SSDs

click here to see our notebook SSDs page
notebook SSDs
This market has not started yet (in 2005) but will kick into play during 2006/7.

My wife is a marketer who travels a lot by plane (in Europe) and train (in London). Running Powerpoint is critical - but so is the ability to pack a notebook PC and a week's worth of clothes and paperwork into a lightweight bag.

Notebook manufacturers like Sony, Toshiba and Dell love this kind of customer. Her lightweight notebooks typically cost 3 to 5 times as much as similar looking luggables weighing 3 to 4 times as much. And she changes them every year - because they never quite have enough performance.

In this part of the notebook market customers pay a hefty price to get less weight and better battery operation... And adding insult to injury - low weight notebooks also have processor clock speeds which are typically 3 times slower than desktop PCs (or luggable notebooks). The expensive notebooks also have slower hard disks because that's another way manufacturers deliver longer battery life.

What can flash SSDs do for this market?

A 30GB flash solid state disk can act as a speedup accelerator - complemeting a low power hard disk - so that a 1GHz lightweight notebook processor delivers similar performance as a 3GHz desktop model. (As CPU clock rates rise - the benefit delivered by the SSD actually increases.)

How much will high powered road warriors be prepare to pay for a flash disk which makes their featherlight notebook PC run as fast as a desktop or a luggable?

$2,000? $1,000?

You'll see that the cost, compared to a hard drive is not the relevant factor.

The customer value proposition in the Road Warrior Featherweight Notebook market is that the SSD provides desktop application performance in a low weight, long battery life form factor which is impossible to achieve using microprocessor technology. (Where high speed - means high power, fans etc.)

As flash disks are on a steeply declining cost curve - and new entrants to the SSD market apply learning curve pricing this application segment for SSDs will grow to billions of dollars in the next 2 years.

...Later:- as predicted - notebook SSDs did become a significant new market - although the road to adoption was much slower than originally expected due to many badly designed and poorly integrated products along the way.
4 High Reliability DAS
and Infrastructure Blades

SSD articles
SSD reliability papers
Although the superior reliability of SSDs has always been a factor in hostile environments (see 1 above) there are new SSD products which have been cost engineered to replace disks in environments where hard disks actually operate without too much trouble.

This is a conceptually new market - pioneered by SiliconSystems in 2004. But other flash SSD makers are also moving in too.

The application is using high reliability flash SSDs to replace disks in servers to reduce service calls and service timeouts. Some of the markets where this approach can be used are in embedded systems in telecoms, cell phone hubs, server farm blades, and physically distributed infrastructure machinery which traditionally uses hard disks. This kind of embedded application often uses much smaller capacity disks than PCs.

The customer value proposition of the High Reliability DAS SSD is that the interval between server failures will be extended by several years compared to HDD technology.

Since the cost of sending out an engineer to a remote cell phone hub (say) to replace a hard disk is orders of magnitude more expensive than the cost of the hardware - the SSD delivers much lower cost of ownership.

This type of operating model suits utilities and other industries which have geographically dispersed servers. But it can also apply to server farms in datacenters too. Flash SSDs not only provide better reliability, but much lower electrical power consumption and lower cooling costs too.

At first glance - all flash SSDs offer better MTBF (mean time between failure) than hard disks. But new design concepts and data management algorithms inside the SSDs means that some vendors' flash disks offer operating lives which may be 2 to 3 times longer than others. We are still in the early days of this sophisticated new market - which is far removed from the consumer market and typical corporate datacenter. But as the capacity of these high reliability disks rises and the cost benefits become better understood - we could see the concept moving into more more traditional IT markets too.
5 SSD bulk storage

lowest TCO for multipetabyte backup, archive and seldomly accessed data (low DWPD) in the cloud

even if hard drives are free!

click to read the article -  reaching for the petabyte SSD
petabyte SSDs
This is a new add-on to the SSD market adoption model - added 7 years after the 1st edition and 5 years after the text above.

Editor:- March 16, 2010 - published a new article which describes the roadmap for the barely nascent SSD Backup Market to replace the enterprise hard disk backup market by the close of this decade.

There will be many technology and marketing challenges along the way. It will require entirely new types of SSD products and new ways of thinking about what the purpose of backup really is. You may be thinking - This can't be serious! Is it April 1st already?" You may change your mind when you've read it. ...SSDs - reaching for the Petabyteyears as they saw product examples in the market
6 low cost DRAM replacement in server The concept of replacing a large proportion of DRAM in servers (and reducing server counts again) with flash or other low cost (but high capacity memory - compared to DRAM) started to become apparent from the user experience of server based acceleration in the PCIe SSD market. The articles below discuss the thinking and products related to this trend.

SSDs are seeping into many market applications long before the time that would be predicted by analysts who cling to the outmoded model of cost per byte parity with hard disks. This article has shown what I believe will be the biggest markets for SSDs in the next 2 to 3 years. I will update the model from time to time - and in the meantime keep tuned to the news and other developments as they appear on our main SSD page.

My thanks to all the people who have helped create this model by their inputs, discussions and questions. I hope you too Dear Reader, find it useful. As with all models which predict emerging markets - it is prone to being wrong. But it's the best I have to offer at the present time.
In September 2010 - I published a new series of articles on the theme - Branding Strategies in the SSD Market - which includes case studies describing how various SSD companies have used branding to stake out their turf in the expanding SSD market bubble.

In March 2012 - I published an introduction to enterprise SSD silos - It describes 7 SSD types which will satisfy all future enterprise needs.

In May 2014 - In my article Decloaking hidden segments in the enterprise for rackmount SSDs I noted that despite all the investment and marketing activity which had taken place in the enterprise SSD market - and despite the growing attractions of this as a place for vendors to focus - there were still many types of customer requirements which were being ignored or not serviced by suitable products.
Retrospective view from SSD market history

This is the original SSD market adoption model which was adopted by SSD product marketers worldwide and helped to ignite the industry!

I know from the many contemporary discussions I had with SSD product marketers and company founders that the ideas and models discussed here - helped those companies see the potential of the SSD market in a new way - which many of them went on to incorporate in their business plans.
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Solid State Disk Buyer Market Survey Results
Editor:- in Q4 2004 - I designed and ran the world's first major market survey designed to learn more about SSD buyers needs and preferences.

It was my idea to do the survey, and to keep it strictly independent I I didn't discuss the design of the questions with any SSD vondors and I didn't ask for any sponsorship.

This article provides a summary of highlights from the survey results.

The survey has identified technical gaps which require new product solutions and service gaps which require changes in the marketing plans of SSD vendors who need to change the way they do business.

SSD vendors must take note of the signals flagged in this survey if they wish to transform this market segment from a niche technical market into a mainstream multi billion dollar pillar of the storage market. the article
SSD Pricing - where does all the money go?
SSDs are among the most expensive computer hardware products you will ever buy and comprehending the factors which determine SSD costs is often a confusing and irritating process...
Clarifying SSD Pricing - where does all the money go? - click to read the article ...which is not made any easier when market prices for apparently identical capacity SSDs can vary more than 100x to 1!

Why is that? the article to find out
SSD ad - click for more info
this way to the Petabyte SSD
In 2016 there will be just 7 types of SSD in the datacenter.

One of them doesn't exist yet (in 2010) the bulk storage SSD.

It will start to replace the last remaining strongholds of hard drives in the datacenter due to its unique combination of characteristics, huge storage density, low running costs and operational advantages.

Bulk storage SSDs will displace the last remaining hard drives in the enterprise server market by 2020 - even if the price of a new hard disk drops to zero and enterprise HDDs are given away free!
click to read the article -  reaching for the petabyte SSD - not as scary as you may think ... The new business and architectural models of the datacenter - how we get from here to there - and the technical and problems which will need to be solved - are just some of the ideas explored in this visionary article.
the future of enterprise data storage?
Editor:- the future of data storage is the lofty sounding but aptly chosen title of a new article published in the January 2011 edition of Broadcast Engineering magazine.

It's written by Zsolt Kerekes editor of (that's me).

It's a completely new article which takes as its starting point - storage market models and concepts from several futuristic articles which have already appeared here on the mouse site - advances them and integrates them into a single cohesive whole.
image shows Megabyte viewing online tv - click to read the article in Broadcast Engineering It will give you a clear idea of how all the incremental changes you read about in storage news pages will add up to a different future - and the business reasons why. Sit back and the article

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