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View from the Hill:- Chewing Over 2003

December 3, 2003 by Zsolt Kerekes
See also:- Storage History
Chewing over 2002
SSD Market History
a Short History of Disk to Disk Backup
The most important storage companies and the most popular subjects in 2003 are listed here. Also includes news headlines and main developments of the year.

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Zsolt Kerekes - Publisher
Zsolt Kerekes is editor of
2003 was the 3rd year of the US IT recession, which officially ended in the 3rd quarter according to IDC. In 2002 it was rare to see news of revenue growth in our storage news pages. But in the 4th quarter of 2003 good financial news became a regular event. Here are some examples which relate to revenues in Q303... We can expect to see more of the same in 2004.

Tape Backup

Tape backup is one of the oldest product segments in the storage market so it's interesting to see how this market changed. The tape drive market had shrunk 8% in revenue in 2002 according to Freeman Reports, and there was little sign in company reports during 2003 that the tape market was going to recover. STORAGEsearch believes that there is a new barrier to revenue growth in the tape backup market. Disk to disk backup which started out as a niche technology evangelized by Nexsan Technologies just a couple of years before gained a lot of new converts in 2003 - including many tape library companies. The writing was on the wall. The declining cost of hard drives, the massive expansion in corporate data, and the growth of internet backup and offsite replication technologies like iSCSI together meant that the traditional advantage of tape - that you could walk out of the building carrying the backup - was no longer true for most companies.

So if tape backup no longer offered convenient off-site data security for most users - it would have to find a new role. I believe that new role is at the entry level, in very small installations - and at the other end of the scale in systems on a Petabyte scale - where tape libraries have been proven, and cautious users will resist the unknown risks and management factors in disk to disk backup. The fate of StoneFly Networks, the pioneer in very large capacity disk to disk systems, will be scrutinized carefully by many to see if this technology really is a viable alternative to tape libraries.

The Top Storage Companies in 2003

We can learn a lot about what users think is important in the storage market by looking at the most popular companies on the STORAGEsearch web site which includes profiles for over 1,000 storage companies. The top companies of the year in 2003, measured by STORAGEsearch reader pageviews on their company profile pages, were as follows:-
  1. LSI Logic
  2. Adaptec
  3. Dell Computer
  4. BakBone Software
  5. Texas Memory Systems
This is the 2nd consecutive year that LSI Logic was the #1 company of the year with STORAGEsearch readers. Adaptec moved up from the #4 slot last year. 3 companies dropped out of the top 5 list - Maxtor, IBM and Sony.

The 3 new entrants in the top list were Dell, BakBone and Texas Memory Systems.

In the case of Dell, this was no surprise. In my article January 2001 I predicted that Dell would be one of the top 10 storage companies (measured by revenue) in 2003. As this has come to pass there has been strong interest in the storage announcements by the company.

BakBone Software was identified as one of the fastest growing storage companies in 2003, having reported 82% year on year revenue growth. The storage software market was one in which most of the growth was being acheived by small and medium size vendors. One of the biggest fish in this pond, Legato Systems, was acquired by EMC in July for $1.3 billion. Legato's mounting losses had made acquisition or bankruptcy almost inevitable. Legato was the 200th company to be listed in our acquired, dead & merged companies list - a dubious distinction.

Texas Memory Systems had two windfalls in 2003. Solid state disks became a very popular subject - as users looked at alternative ways to speed up high end servers. The SSD market could be worth as much as $10 Billion in 2007. The other windfall was that their main competitor Imperial Technology went bust in the summer.

The Most Popular Subjects

There are over 60 storage categories on STORAGEsearch. The top 5 most popular, based on pageviews in the first 11 months of 2003 are as follows.
  1. Serial ATA
  2. Solid state disks
  3. NAS
  4. Backup software
  5. iSCSI
This is the 2nd year that SATA hit the #1 spot with our readers, confirming that the 5 year old STORAGEsearch is used by early adopters as well as more experienced buyers. Seagate Technology said in December it had shipped more than 1.5 million SATA hard drives - more than twice the number of its nearest competitor. This new market has great potential according to Gartner who projects that Serial ATA hard disk drives will grow to nearly 350 million units in 2006.

2003 was the year that iSCSI transitioned from being a vaporware market into real product shipments - boosted by Microsoft's support in the summer. See article:- iSCSI is now a market reality.

In 2003 increased demand and prices for memory products boosted the revenues of semiconductor companies who made these products. The Flash Memory market grew 25% (to $9.7 billion) according to SIA. AMD reported in October that their flash revenue had doubled to $424 million for the third quarter. The faster than expected growth in the RAM market was a factor in Infineon's 26% revenue growth.
the top companies in 2003
The top 5 companies in 2003 on based on reader pageviews.
  1. LSI Logic
  2. Adaptec
  3. Dell Computer
  4. BakBone Software
  5. Texas Memory Systems
For Megabyte it wasn't about playing the game. It was all about winning.

Serial ATA -  product category of the year 2002
Serial ATA
Product Category of the Year 2003
Megabyte's Auntie Wanda liked to use a mixture of traditional and new technology when gadding about her relations.

RamSan-400 Enterprise Solid State Disk
The World's Fastest Storage
from Texas Memory Systems

Advertising info and pricing
on STORAGEsearch
When Cheaperbyte's sales manager said "Accelerate your storage sales", he knew just the right way to do it.

Pick of the News Stories in 2003

January 2003 - A new hard disk form factor was born... Hitachi Global Storage Technologies introduced a new 1.8-inch form factor for hard disk drives aimed at handheld computers aimed at portable consumer electronics. The Hitachi Travelstar Compact Series C4K40, was launched with 40 and 20 gigabyte capacities.

On the negative side - the SQLSlammer launched the new season of worm attacks on corporate web sites. These have become a feature of every day life - but despite the best efforts of the security industry - they remain a compelling argument for companies to look at Linux and other Unix operating systems, because these appear to be less vulnerable to this kind of criminal attack.

STORAGEsearch news archive - 2003, January week 1, week 2, week 3, week 4, week 5

February 2003 - A new tape form factor hit the streets... Sony Electronics started shipping production units of its first-generation SAIT drives and media to tape library automation OEMs. With the ability to store up to 1.3TB of compressed data on a half-inch tape cartridge, SAIT-1 staked its claim as the industry's highest capacity tape drive and the first available product to break the 1TB barrier.

STORAGEsearch news archive - 2003, February week 1, week 2, week 3, week 4

March 2003 - SATA drives made their first retail appearance... Seagate and Best Buy, one of the nation's leading entertainment technology retailers, became the first to offer Serial ATA hard drives to retail consumers.

Meanwhile acquisitions continued at an almost daily pace. Adaptec agreed to acquire Eurologic Systems (a RAID systems company).

STORAGEsearch news archive - 2003, March week 1, week 2, week 3, week 4

April 2003 - Emulex and Intel announced they were collaborating one the development of next-generation storage processors that would integrate Serial ATA, Serial Attached SCSI (SAS) and Fibre Channel interfaces within a single architecture.

Spectra Logic launched its first native iSCSI tape libraries.

CNT agreed to acquire Inrange Technologies (a maker of FC switches).

STORAGEsearch news archive - 2003, April week 1, week 2, week 3, week 4

May 2003 - InoStor was awared a US patent for its RAIDn technology. InoStor said that RAIDn could deliver greater availability than typical RAID schemes with equal disk drive investment, and was looking for licencees. article:- The New RAIDn Algorithm - How Does it Compare?

Diamond Lauffin, Senior Executive VP of Nexsan Technologies (a network disk to disk backup maker) said "Tape is a thing of the past." Actually disk to disk backup was much more popular than tape throughout 2003 based on reader pageviews.

STORAGEsearch news archive - 2003, May week 1, week 2, week 3, week 4

June 2003 - Unigen was awared a US patent for a data protection algorithm for semiconductor devices which allows the safe storing of data without corruption by anyone other then the intended user. The unique algorithm is applicable to all types of Non-Volatile Memory (EEPROM, Flash, etc).

Network Appliance announced that it had acquired the patent portfolio of Auspex Systems Inc. The patent portfolio covered many technologies central to NAS systems. Auspex was the world's first NAS company (founded in 1987) but was useless at marketing and failed to establish a high volume customer base before it went bust. But it had good technology.

Intel resold ICP vortex Computersysteme (a RAID systems company) to Adaptec. Intel originally acquired ICP vortex in March 2001, but decided to refocus on the chip side of the storage business instead of boxes.

STORAGEsearch news archive - 2003, June week 1, week 2, week 3, week 4

July 2003 - The summer was a hot time for iSCSI announcements. EMC announced it had added native iSCSI connectivity across the entire Symmetrix DMX series.

In old fashioned (parallel directly attached) SCSI - the high speed leading edge was Ultra320. LSI Logic announced that its Ultra320 SCSI server market share had topped 80%, based on server market sockets available for design wins.

STORAGEsearch news archive - 2003, July week 1, week 2, week 3, week 4

August 2003 - A power grid failure in mid August knocked out electricity supplies to millions of people in New York and Canada for a long weekend. This caused peak readership spikes on STORAGEsearch as IT managers and individuals looked at articles about data recovery.

Although the InfiniBand market during 2003 was still a dust spec in revenue terms, some real products were shipping in development quantities. The promise of this technology was illustrated by a press release from InfiniCon. Using standard Intel-based servers, InfiniCon's VFx Fibre Channel Gateway line card demonstrated performance in excess of 150,000 IOPS over two 2Gb/s Fibre Channel ports.

STORAGEsearch news archive - 2003, August week 1, week 2, week 3, week 4

Squeak! - Animal Brands and Metaphors in the Storage Market
Squeak! - Animal Brands and Metaphors in the Storage Market
Animal marketing metaphors are popular in service industries, but you'd be surprised how many companies have used animals in their marketing of data storage products and services.

The storage market was worth over $150 billion in 2005, and as it gets bigger - more companies will turn to animal brands to help differentiate their otherwise bland products and lend them artificial (or deserving) characters and virtues.

The idea behind this type of marketing is to suggest positive connotations so it's unlikely that anyone will choose to associate their products with gremlins. But you may be surprised by the population of the storage ark.

This reference articles lists all known companies who have furry marketing brands, and also includes some which are slimy, scaly and scary too. the article, Mice in storage

September 2003 - Hurricane Isabel gave the world interesting TV pictures of reporters being blown about Virginia Beach and was another reminder to IT managers that having a backup might not be much use if it was lying under several feet of salt water. Many storage vendors used the opportunity to tout their offsite backup technologies.

The big event of the month was Microsoft's Windows Storage Server 2003, the newest version of what was previously known as Windows Powered NAS. This was aimed at NAS appliances and was the dominant platform in this product category.

STORAGEsearch news archive - 2003, September week 1, week 2, week 3, week 4

... isabel woes? click for data recovery
Megabyte was an expert at
recovering data. But first he
had to find the Virginia Beach
branch office.

October 2003 - Silverback Systems announced it was shipping its iSNAP 2100 storage network access processor, the highest performance solution for implementing iSCSI. Silverback reported 220,000 IOPS for the dual-channel, gigabit Ethernet iSNAP2100, demonstrating iSCSI performance for both database and OLTP traffic.

Agere Systems was the first company to announce a serializer/deserializer core that addressed all the necessary high-speed I/O protocols for SAN infrastructure on a single chip. Agere's SerDes aimed at the market for 1, 2 and 4 gigabits per second Fibre Channel while offering customers an easy evolution to 10 Gb/s all in the same core. The new SerDes core also supported 1.5 and 3 Gb/s serial ATA and serial attached SCSI and PCI Express.

STORAGEsearch news archive - 2003, October week 1, week 2, week 3, week 4

November 2003 - SBS Technologies introduced the industry's first InfiniBand HCA to be provided on a PCI mezzanine card (PMC). With dual 20 Gb/s 4x InfiniBand ports, the IB4X-PMC-2 HCA was a second-generation product and included application support for Sockets Direct Protocol (SDP), Internet Protocol over InfiniBand (IPoIB) to enable TCP/IP to run over InfiniBand links, and SCSI Remote Protocol (SRP) initiator to enable SAN. This was convincing proof that if anyone out there wanted to use InfiniBand for embedded applications - the products were available.

Adaptec became the first company to achieve full first-generation Serial Attached SCSI speeds of 3Gbps in tests of an ASIC that reached peak throughput of 5Gbps.

STORAGEsearch news archive - 2003, November week 1, week 2, week 3, week 4

December 2003 - Seagate Technology announced it had shipped more than 1.5 million Serial ATA hard drives - more than twice the number of its nearest competitor.

IDC reported that Worldwide disk storage systems factory revenues were $4.8 billion in the third quarter of 2003 down 0.3% compared with the third quarter of 2002. My own take on this is that two factors may have dampened the numbers which IDC used.

  1. I suspect that server companies like HP and IBM which were significant fractions of the reported disk storage market - may have padded their headline server revenues a little bit by including some bundled storage. This would have depressed their reported storage sales which are not so politically sensitive.
  1. For historical reasons IDC's category called "others" may not include a big enough sample of the hundreds of manufacturers which now make external storage systems.
STORAGEsearch news archive - 2003, December week 1, week 2, weeks 3 - 4

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