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Technology Stocks : EMC How high can it go? -- Ignore unavailable to you. Want to Upgrade?

To: VFD who wrote (13474)	11/13/2001 7:19:23 PM
From: Gus	Respond to of 17183

Most of IBM's estimated market share gains (~$715M) appear to come from the mainframe environment and hardcore IBM shops with mainframes, AIX and NT servers provided by IBM. AIX, I think, gained share on Sun this year and it uses IBM's proprietary SSA drives and arrays. Last year Hitachi and Amdahl decided to retreat from the mainframe market leaving IBM as the last mainframe vendor standing. This year IBM decided to exercise its monopoly powers by controlling the migration from ESCON to FICON principally by building a cogent business case to its mainframe customers that there is no need for a FICON SAN to interconnect to a Fibre Channel SAN even though the directors from McDATA and Inrange are capable of partitioning both FICON and Fibre Channel in one fabric. As you know, ESCON is the only way anybody to connect to a mainframe. FICON is ESCON mapped over Fibre Channel. Both EMC and HDS won't be able to rollout their FICON products until 1Q02. I suspect that IBM's gains this year in the mainframe market will erode next year when both EMC and HDS tap into the pent-up demand for their mainframe storage products which also serve to balance IBM's uncontested control of the mainframe market. At the rate that IBM has been giving Shark away for the past two years, the trade-in values are bound to be very low should EMC and HDS decide to contest any account.

To: VFD who wrote (13474)	11/13/2001 7:39:46 PM
From: Gus	Read Replies (1) \| Respond to of 17183

3rd rewrite from Reuters: Preliminary IDC Forecast CY2001 Total SAN NAS EMC 25.3% 37.9% 42.0% IBM 11.6% 18.2% NA Compaq 11.0% 17.9% NA NTAP ~4.0% 0.0% 32.5% Others 48.1% 26.0% 25.5% Total 100.0% 100.0% 100.0% Total Market Size $14.9B NA $1.85B .........Gallant pointed to EMC's surging performance for network attached storage, a sector that will grow nearly 14 percent this year, according to IDC's forecast. IDC expects EMC to overtake Network Appliance Inc. in that market this year with $777.2 million in revenue, or 42 percent of the network attached storage market. Network Appliance, which controlled 45 percent of that market last year, is expected to drop to a 32.5 percent share, according to IDC. Adam Trunkey, a spokesman for Network Appliance, said the company will rebound next year as price becomes more of an issue. ``We're about one-quarter of the cost of EMC,'' he said. [Note: 1/4 the cost, but only 1/10 the functionality. No comparison in reliability. Huge difference.] EMC's market share within storage area networks, which are customized networks for storage devices loaded with software, is expected to dip slightly to 37.9 percent this year, compared with 39.5 percent in 2000, IDC said. Customers have been postponing purchases in that sector, which involve complex and expensive storage systems, IDC said. Nevertheless, IBM's market share in that sector will nearly double to 18.2 percent, up from 9.6 percent in 2000, IDC said. That would give IBM the No. 2 spot, overtaking Compaq, whose market share slipped to 17.9 percent from 19 percent.