DJ Disk-Storage Market Grows Slightly In 2Q From 1Q
By Riva Richmond Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--The disk-storage hardware market grew slightly during the second quarter from the first quarter, a performance that could suggest the market is beginning to stabilize, said Eric Sheppard, an analyst at IDC, a technology research firm.
IDC's report on the segment, published Wednesday, said revenue rose 0.9% to $4.7 billion in the second quarter from $4.66 billion in the first quarter.
The disk-storage hardware market shrank 18.7% between the fourth and first quarters. Calendar 2002 will likely still show a double-digit decline from 2001 levels, Sheppard said.
The competitive landscape shifted somewhat during the period, according to the report. International Business Machines Corp. (IBM), Sun Microsystems Inc. (SUN), EMC Corp. (EMC) and Dell Computer Corp. (DELL) all increased their shares of the market. Their gains came at the expense of Hewlett-Packard Co. (HPQ) and Hitachi Ltd. (HIT).
H-P held the top spot with 24.9% of the $4.7 billion market, but its share fell from a combined H-P-Compaq share of 26.9% in the first quarter. The two companies merged in May, and the decline could suggest integration pains.
"Via acquisition, H-P is now the largest disk-storage company. It might not be organic, but it's real," Sheppard said. "On their heels are a lot of vendors."
During the quarter, IBM added 1.4 percentage points to its piece of the pie to reach 16.3%. The company was helped by strong sales of mid-range products and, perhaps, by a bump from a "refreshed" high-end offering, Sheppard said.
Sun's market share jumped to 8.8% from 6.7%. The company was helped by its reseller relationship with Hitachi and a sales push for a strong fiscal-year close
EMC's market share rose slightly to 13.7% from 13.3%.
Dell, benefiting from its partnership with EMC, added a half point to reach a 5.8% share, moving ahead of Hitachi, which fell to the No. 6 spot with 4.8% of the market, down from 6.7% in the first quarter. Hitachi's decline isn't as bad as it looks, because IDC counts some of the revenue for its products under Sun and H-P. Network Appliance Inc. (NTAP) held steady with a 2.7% share.
Despite the still-tough business environment, Sun saw revenue growth of 31.3%. IBM grew 10.8%, Dell 9.7%, EMC 3.7% and Network Appliance 4%. H-P's revenue declined 6.4% and Hitachi's fell 27.7%.
In the fast-growing storage-area-network, or SAN, market, EMC maintained its lead with market share of 30.2%, up slightly from 30.1% in the first quarter. The total market for SANs, high-speed networks of shared storage devices, was $1.29 billion in the second quarter, up 5.1% from $1.23 billion in the first quarter.
The merged H-P Compaq might have taken the No. 1 SAN position, but it came in second with a 28.2% share, compared with a combined 32% in the first quarter.
Sun jumped 3.9 percentage points to a 11.9% share, and IBM and Dell both gained ground. Hitachi fell to 6.2% of the market from 8.5%, dropping to No. 5 from No. 4.
In the market for network-attached storage, or NAS, EMC stretched its lead to 37.6% of the $396 million market. It had held 36.4% of a $379 million market in the first quarter. EMC's closest rival, Network Appliance, held steady at about 32.6%. Dell and H-P added to small slices of the market, while IBM and Hitachi foundered a bit.
The direct access storage, or DAS, market, which is being displaced by networked devices, declined in revenue to $2.79 billion in the second quarter from $2.83 billion in the first quarter. The combined H-P Compaq was No.1, but saw a 7% revenue decline. Runners-up IBM, Sun and Dell saw their DAS sales increase.
-Riva Richmond, Dow Jones Newswires; 201-938-5670; riva.richmond@dowjones.com
(END) DOW JONES NEWS 09-18-02
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