TP, BRCD is not a storage company, imo. They build a product used by storage companies, but are in a tremendously competitive, low cost of switching, low barriers to entry, standards-based industry--fibre channel.
I think RBAK is in the same boat, but tell me if I am wrong.
NTAP and EMC, otoh, are in the storage system business. Not to be confused with Seagate and the disk drive industry, who are in the same boat as the FC guys.
NTAP and EMC can innovate using the components from the disk and fc industries. NTAP, at least, owns enabling software (ONTAP, WAFL, etc) that creates a barrier to entry, and, for customers using other NTAP software like SNAPSHOT and clustered systems, switching costs become significant.
NTAP and EMC have been "the hot company in the sector" for a few years now. BRCD, RBAK, EMLX, etc., are in a different sector where discontinuous innovations are pouring in, just like the disk drive sector has been for many years.
So to pick a basket of stocks in a sector first requires one to carefully define the sector and even more carefully define the contendors. But don't forget to judge whether the sector will tornado with an eventual King or Gorilla. IMO, fc's tornado will result in rapid growth for a number of companies, but in the end you will have a basketful of Princes. The SAN/NAS marketplace(s) are in a tornado and royalty will result and the apparent winners are EMC and NTAP. |
