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Technology Stocks : Son of SAN - Storage Networking Technologies -- Ignore unavailable to you. Want to Upgrade?

To: J Fieb who wrote (3703)	7/29/2001 3:03:53 PM
From: Gus	Read Replies (1) \| Respond to of 4808

Good points, J. Also, Heteregeneous SANs tend to pull in more service and software revenues than the homogeneous SANs being sold by the likes of Compaq and Dell. Here's an article that looks at the way Compaq captured 49% of the SAN market in 2000 *based on the number of units sold --* 24,000 SANs containing about 164,580 switching ports, or an average of just under 6.86 ports per SAN. These SANs are based primarily on Brocade's 8-port and 16-port switches. Even though Compaq plans to increase the size of their SAN solutions from last year's 4-switch maximum to 20 switches this year, I think Compaq is going to have a hard time replicating its success in deploying SANs this year. Considering that 70% of Compaq's SAN revenues come from the channel, that has implications for Brocade's visibility. Note that despite capturing 49% of SAN market shipments last year, Compaq still managed to lose SAN market share based on revenues! Date: 26 Jul 2001 Compaq gets twin kudos from Gartner By Alan Earls Compaq Computer Corporation, Houston, has been ranked as the world's number one supplier of storage area networks (SANs), according to research from Gartner Dataquest based on 2000 sales. Gartner Dataquest reports that with more than 24,000 units shipped last year, Compaq sold more SAN-attached storage systems than its six nearest competitors combined, accounting for a 48.5 percent market share. "The enterprise storage space currently is going through significant redefinition in terms of what customers are buying," said Roger Cox, chief analyst with Gartner Dataquest. "Recent Gartner Dataquest research projects that SAN-based storage will grow from just 16.3 percent of the total multi-user storage market in 2000 to 70.7 percent in 2005. The much more restrictive direct attached storage (DAS) paradigm, where storage is directly attached to a server, is rapidly being displaced by the more flexible and cost-effective storage area network (SAN) paradigm. Companies that maintain clear leadership in the SAN arena will end up dominating the entire storage market." In addition to its industry-leading share of the SAN market, Compaq also was ranked number one in deploying switching ports for SANs, according to a Gartner Dataquest Research Brief on 2000 Fibre Channel SAN components. Compaq accounted for 26 percent of the 633,000 switching ports deployed last year. The Gartner Dataquest research indicates that Fibre Channel SAN component revenue grew 157 percent in 2000. The research also showed that last year saw the completion of the transition from hub to switch dominance in this market space. Is all this praise of Compaq a matter of dumb luck? No, according to Enterprise Storage Group (Milford, Mass.) Analyst Arun Taneja. For one thing, he says, Compaq took to SANs sooner than any of the other server players like IBM, HP and even Sun. Furthermore, they took a simple approach in the beginning by building simple, homogeneous SANs built with hubs in the low end and switches in the high end. But even the high-end SANs were simple in that they were confined to a limited number of Compaq servers and presented as worry-free, tested solutions for specific problems. "In effect," says Taneja, "Compaq eliminated the thorniest issue of SANs--interoperability." "Customers responded well and I am not surprised that Compaq has done as well as they have," he continues. Recently Taneja notes, Compaq has expanded the scope of its solutions but still maintains the use of Compaq-only servers. Now that most of the interoperability issues are resolved, however, and other vendors have learned from their mistakes, Taneja says, "I don't think you will see such heady market shares for Compaq in 2001 and beyond." searchstorage.techtarget.com