Bill, this clip below confirms what you have been saying all along. But, to help me understand, why exactly is a storage appliance now central?--because it is the sheer volume of digitized information that is important, more important than how fast it is processed? I know you have addressed this issue many times before. I just want a sentence about the new centrality of storage that will stick in my forgetful head. TIA
<<<<EMC sees servers as peripheral
NEW YORK (Reuters) - Data, data flooding everywhere and no where left to store it.
Storage equipment leader EMC Corp. Tuesday said an Internet-fueled explosion of e-mail and other corporate data has led data storage to replace computer processor power as the main focus of new spending among business technology buyers.
EMC executives told analysts and fund managers crowded into the company's annual product briefing here that the powerful server computers traditionally used to manage the flow of information around offices are fast becoming irrelevant.
At the meeting, EMC unveiled a range of new storage systems, software and network equipment that company officials said was already shipping to customers and would account for a ''significant'' proportion of revenue for its current quarter.
``Today, we clearly believe that servers are becoming peripherals,'' Michael Ruettgers, president and chief executive of the Hopkinton, Mass.-based company, said of a role-reversal in which storage systems are displacing computer functions.
He highlighted statistics from market research firm International Data Corp. of Framingham, Mass. that estimated 80 percent of corporate technology spending in 2003 will go to pay for storage equipment vs. 20 percent for servers. Fifty-four percent of corporate spending in 1999 went to storage equipment, with the rest to computers and the like.
Buoyed by EMC management's confident tone and broad new product line-up, shares of EMC closed up 4-7/8 at 134-3/8 on the New York Stock Exchange, amid a general rebound in technology shares following the latest sector sell-off Monday.
WITH OUTLOOK STRONG, EMC STOCK REMAINS NEAR RECORD HIGHS
Reflecting its status as one of Wall Street's ``must own'' technology stocks, EMC at 134 remains within striking distance of its record high of 145-5/16 -- in contrast to the sharp fall in value of many other formerly high-flying technology names.
Though less known than many industry peers, EMC is the leading franchise in data storage, as Intel Corp. is to computer chips, Sun Microsystems Inc. is to Web site computers, and Oracle Corp. is to databases.
EMC's product lead has helped it continue to gain market share vs. computermakers such as IBM, Hitachi Ltd. , Hewlett-Packard Co. and Sun, whose storage systems are still largely tied to sales of their own servers.
``We've talked about a two-year-lead,'' Jim Rothnie, senior vice president of product management, said of the technology head-start EMC has long claimed to hold over its computer maker rivals. ``We now have a three-year-lead,'' he said.
To reinforce its lead, Ruettgers said the company was ready to spend $2-1/2 billion on research and development on new and enhanced products over the next two years, up from the roughly $2 billion analysts were expecting. By contrast, EMC spent $5 billion on research and development during the prior 10 years.
Many Wall Street analysts agree. ``The competition, which includes the major server makers, have repeatedly said it was only a matter of time before they overtake EMC's lead,'' Warburg Dillon Read analyst Charles Wolf said after the event.
``Rather than catch-up, they appear to be falling further behind,'' he said. International Business Machines Corp. has frequently promised to unveil ``EMC killer'' products, but has so repeatedly delayed introduction of competitive features.
EMC UNVEILS NEW PRODUCT LINES, SAYS LEAD GROWING OVER RIVALS
At the meeting, EMC unveiled a range of new storage systems, software and network equipment that company officials said was already shipping to customers and would account for a ''significant'' proportion of revenue for its current quarter.
The Symmetrix 8000, an upgrade of its flagship product line, strings together hundreds of hard disk drives in a single system in an oversize box the size of three side-by-side refrigerators. The 8000 includes the world's highest capacity storage system, capable of holding 19 trillion bytes of data.
It offers twice the capacity of EMC's current mainstay product, the Symmetrix 3000 series, and three- to four-times the storage transaction performance of rivals, officials said.
EMC also introduced a range of new software to more efficiently manage the flow of data across corporate networks. One new program, TimeFinder 4.1, allows EMC storage systems to make eight instant copies of a database at different points in time, allowing speedy data recovery in case a system fails.
EMC's strategy is to develop products suited to a variety of different business operations then linking them all together in a single, organization-wide system that offers office employees access to data located anywhere in the company.
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