IDC recently released their storage market share estimates for both the fourth quarter of 2010, as well as the full calendar year.
While there's much to be gleaned from the latest estimates, I though it'd be interesting to take the long view: by charting the market changes from 2002 through the more recent 2010.
That's nine full years of market evolution. What can we learn?
The Basics
IDC's estimates, while not perfect, are widely regarded as the gold standard in the storage industry.
It's important to pay attention to terminology here.
IDC supplies numbers on "worldwide external disk storage" (excluding internal server-based storage), "worldwide external RAID disk storage" (excluding simple enclosures), "worldwide network disk storage" (excluding storage devices that are designed to attach to a single server), and so on.
It's predominately a hardware-only view: storage software shows up in IDC's storage software tracker. Vendors get credit for branded products they ship to end users; as a result, OEM storage suppliers aren't represented here.
I decided to choose 2002 as a starting point simply because the "dot com" crash of 2000 and 2001 was safely in the rear view mirror by that time. Other than a pause during the recession of 2009, it's been a fairly consistent picture of growth.
So, when we look at the numbers from 2002 from 2010, what can we see?
External Storage Grew -- A Lot
$12.8 billion of external storage was sold during 2002. $21.2 billion was sold during 2010. That's a healthy ~66% growth over 9 calendar years.
Despite the astonishing declines in price-per-usable-gigabyte over this period of time, we're all still spending more on storage with every passing year.
No wonder we see so many players -- large and small -- in the storage market. Other than a brief pause in 2009, it's been the picture of rude health.
EMC had 18.8% of this external storage market in 2002 (good for #1 position), and expanded this lead to 25.6% market share in 2010 -- a gain of 6.8 market share percentage points over 9 calendar years.
In the "not doing so well" category, we've got Sun, declining from 7.4% of this market segment to 3.4%, HP declining from 15.3% to 11.1%, and Hitachi from 9.2% to 7.8%
The Shift To Network Storage
$6.23 billion of external storage was networked in 2002, or proportionally 49%. That rose to $17.55 billion in 2010, or proportionally 83%
The story is clear: most storage sold today is of the network variety, e.g. it can attach to multiple servers simultaneously.
EMC is traditionally #1 in this category, with 29.5% market share for 2010. NetApp and IBM are statistically tied for second (13.4% and 13.0% respectively, with HP a smidgen behind at 10.9%.
But how are the protocols shaping up?
The Rise of NAS?
In 2002, NAS-based storage products accounted for a mere $1.59 billion in revenue. That was 25% of all networked storage, and a mere 12% of the broader external storage market.
By 2010, the picture had changed, but not substantially: $5.1 billion was sold: a incrementally larger 29% of the network storage marketplace. If the world is going to NAS, it's obviously getting there at a leisurely pace.
During most of this period, EMC has been the #1 supplier, with 33% of the market in 2002, rising to 48.6% in 2010. NetApp is #2, falling from 34.7% in 2002 to 26.4% in 2010.
Once you get beyond these two vendors, however, there's no one much to talk about from a NAS market share perspective.
The Growth of iSCSI
In 2002, IDC didn't record any meaningful for iSCSI-based products.
The first real revenue showed up in 2003, a mere $18m. For 2010, this rose to $2.5 billion, a meaningful 14% of the networked storage market, and 11.8% of the broader external storage market segment.
Dell is the clear market leader in this segment, with 34.2% of iSCSI revenue. EMC and HP are statistically tied for second at 13.5% and 13.3% respectively. And NetApp is a smidgen back with a respectable 11.9% revenue share.
It should be pointed out, though, that the IP protocols (NAS and iSCSI) when taken together are currently $7.6B of the broader $17.55 billion networked storage market, or a healthy 43%
What About The "Other" Category?
One of the categories I try and follow is IDC's "other" -- these are all the smaller vendors who don't make the cut for top-tier billing in the IDC report.
Collectively, I think they serve as an interesting barometer of how many newer players are piling into the storage space, and -- more importantly -- how well they're doing vs. the more established players.
In 2002, "Other" storage vendors accounted for 13% of networked storage revenue. In 2010, the proportion had dropped to 9.1%. Although there are many more revenue dollars in play now, proportionally fewer of them are going to the smaller storage vendors.
What Does All Of This Mean?
One could try and make an argument that the last decade belonged to the network storage specialists. EMC gained market share, as did NetApp. But Hitachi (arguably a storage specialist) lost external storage market share during this period of time.
Conversely, some server vendors who sell storage didn't do so well (notably HP and Sun) of this time period, some held their ground (IBM, for example), and one did quite well indeed (Dell). So no consistent picture here, either.
Several things are clear, though.
Every year, more storage is sold. A lot more.
Every year, more and more of it is networked.
And, every year, more of it is networked with IP-based protocols (NAS and iSCSI). Right now, IP-based protocols are responsible for a little less than half of all networked storage.
If you're looking for prognostications on the future of the storage market, I think the above statements are a pretty good starting point :)
By Chuck Hollis
VP -- Global Marketing CTO
EMC Corporation
