SNI bucks IPO trend

Storage Networks was able to demonstrate that the initial public offering market is still alive and well when its shares skyrocketed 234 per cent after it went public last week.

Storage Networks (SNI) was able to demonstrate that the initial public offering market is still alive and well when its shares skyrocketed 234 per cent after it went public last week.

SNI, hoping to ride an expected wave of storage outsourcing, is the best-known of several startups offering to manage the storage needs of businesses and consumers at remote data centres.

Researcher IDC forecasted that global storage services expenditure will top $40bn (£27bn) in 2003, up from about $21bn last year. Of those services, management and outsourcing will have a compound annual growth rate of 31.8 per cent.

Businesses are getting ready for storage outsourcing, said Steve Duplessie, senior analyst at researcher Enterprise Storage Group. As storage needs outstrip the ability of companies to grow their storage capacity and management, he said, outsourcing will become an important part of their strategies.

Businesses should focus on core competencies and leave storage to experts. "Dotcoms were born for storage outsourcing," he said.

Observers have predicted that corporates will hesitate to hand their data to outside service providers. "But data backup is a universal headache," Duplessie said.

In disaster recovery and backup, outsourcing will be preferable to building a second storage infrastructure, he said. "I could outsource secondary and tertiary operations and still control all my own data. As companies get used to storage service providers, they will move more of their data."

• IBM is challenging SNI by launching its NetfinityFAST200, called the Piranha, aimed at the entry-level Windows Fibre Channel storage market.

In addition, its Shark enterprise storage server has been optimised for fibre connection to S/390, NT, RS/6000 and Numa-Q. IBM has also launched its packaged SAN solutions, called SmartPaks, for the channel to help customers implement SANs.