Qwest Uses HP for Outsourced Storage But EMC Internally
Section: 01. Top Stories
By William Fellows
Hewlett-Packard Co and Qwest Communications Inc continue to push forward the ways that companies use and pay for IT services, yesterday extending their 'apps on tap' hosting relationship to storage. Claiming to have "changed the rules on storage", Qwest, the number four long distance carrier in the US, will begin offering a range of storage services using HP equipment in a deal expected to be worth $1.5bn over three years. During this time it will spend several hundred million dollars on HP SureStore E disk arrays, switches and software. It's essentially a revenue-sharing agreement. Qwest expects to pick up $200m in revenue from the deal in year one.
The deal is sure to stoke the engines of companies like Boston, Massachusetts-based start-up Storage Networks Inc which already offers enterprise storage outsourcing services. And HP and Qwest are clearly stretching the point when they say what they are doing is new.
In fact Qwest, which uses storage from HP rival EMC Corp for all of its internal requirements, went to EMC for a deal first but was turned down, EMC told ComputerWire. EMC said it told Qwest that it "doesn't give boxes away" and claims that HP is effectively giving away disk storage to gain market share. "HP has no acceptance in the internet space," EMC told ComputerWire.
Qwest, which practically owns the IP-through-glass market, says that for the first time customers will have real access to storage on demand. It is building seven new CyberCenters for its hosted services in addition to the seven it already operates, some of which have already reached capacity. The next challenge will be to link customers to its storage centers over direct optical connections, Qwest says.
Qwest will offer data storage, management, backup, disaster recovery and other services. Instead of paying for expensive disk subsystems, customers that in many cases also have to pay for a second backup systems, will be able to rent storage space from Qwest.
Qwest is aiming the new services primarily at middle market users of Unix and Windows NT applications, many of which are claimed to have vast storage requirements. Although it will complement the 'apps on tap' service, Qwest does not expect the customer list to be a duplicate. Qwest now uses a range of storage equipment - mostly HP - and says it won't be substituting any for the HP kit.
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