Big boys struggle in storage market as newbies march ahead

Global external storage revenues slump 1.4 per cent on last year

HP was the only top-five vendor to grow in the external disk storage market last quarter, according to IDC, which pointed to a surge in sales among the collective group of smaller players.

In Q2, global external disk storage revenue fell 1.4 per cent annually to $5.9bn (£3.62m), not helped by shrinking sales of the top-five storage vendors.

Market leader EMC saw its Q2 revenue slump 5.2 per cent annually, while in joint second place NetApp and IBM suffered similar fates as their respective sales slumped three per cent and 4.7 per cent over the same period. HP was the only top-five vendor to grow, managing just a 0.4 per cent sales hike.

In joint fifth place, Dell and Hitachi took a one per cent and 12 per cent hit to their storage sales respectively in Q2.

IDC research director Eric Sheppard warned that falling demand for high-end arrays was spreading throughout the market.

"High-end storage sales fell for the fourth consecutive quarter in 2Q14," he said.

"The high-end decline was not as striking as last quarter but it was coupled with a drop in mid-range sales, suggesting weak demand is spreading to other parts of the market. Bright spots within the global storage market include growth from entry-level storage and increased sales within EMEA and Latin America."

While the storage giants struggled, the "others" category - comprising all the companies operating in the market outside the top five - managed to post 11.1 per cent growth in Q2.

This category's market share now stands at 21 per cent, almost double that of NetApp's 13 per cent share and not too far behind the 30.1 per cent share EMC holds.

New names have stormed the storage market recently, with virtualisation player Nutanix recently bagging its second massive round of funding this year, and EMC's flash rival Pure Storage continuing its war against the storage giant.

Just this morning, fledgling firm DataStax announced it has secured $106m in Series E funding, taking its total investment figure close to the $200m mark.
Its chief executive Billy Bosworth said his business has been the beneficiary of an increasing demand for storage.

"Demand for DataStax is strong and accelerating as companies are realising that in today's world you either make data the centre of your business or fall far behind your competitors who do so," he said.

"We have become the very fabric of the digital age and we are blazing the trail, helping to drive the future of enterprises and startups alike."