Have we witnessed the end of an era? Has the great storage company growth boom ended with a series of big bang acquisitions: 3PAR, Archivas, Compellent, Data Domain, Diligent, EqualLogic, Isilon, LeftHand Networks, Ocarina, Storwize and more? Over the last five years a whole swathe of up-and-coming storage companies has been gobbled up by the majors eager to buy into technology and markets where they have limited or no presence.
The net result is that, in storage terms, EMC, Dell, HDS, HP, IBM, Netapp (less so) and Oracle – the big seven – are bigger than ever, with virtually a whole layer of substantial startups and early-stage public companies becoming operating units of the super seven.
The ones left behind, the too-large-to-buy (Symantec?), the refuseniks, the hard-to-swallow technologies, the mature niche occupants (CA) and the rejects, now have to grow organically and will have a harder job doing so because their previously independent competitors now have big bucks behind them for more development and greater sales and marketing resources.
If BlueArc, DataCore, FalconStor, Pillar, Sepaton or Xiotech ever thought that acquisition was an attractive option, it must now seem as if that door is closed and they have to grow the hard way, the organic way, the DIY way of building great product, keeping up with the market, and selling, selling, selling, which they can do as they have great products and energetic and enthusiastic execs running them.
There are a lot of early and mid-stage start-ups that could grow into substantial mid-tier publicly owned storage companies in the next five years though. Who are they and where are they in market niche terms?
The runners and riders for the next five years:
- There are a couple of filer accelerators with promising technology: Alacritech and Avere, both coming at filer acceleration from different angles and both seeming to work turbo-charging access magic on bulk-storage filers.
- In the we-can-do-it-cheaper-still storage array business Coraid (Ethernet storage) and Nexenta (ZFS-based arrays) have prospects.
- Cloud storage access gateways look to be promising too – think Aspera, BridgeSTOR, Cirtas, Nasuni and Riverbed.
- Cloud storage itself is looking good for Nirvanix and it could grow and prosper competing against majors such as Amazon, EMC, HP, Microsoft and others with deep pockets.
- Compression and deduplication might have mileage still for independents such as balesio, Hifn and Permabit.
- Flash storage is looking very, very good for SanDisk and for newcomers Fusion-io and Violin Memory, also for Texas Memory Systems with both flash and DRAM solid state storage. Anobit, Pliant, SandForce, and WhipTail are making their own waves with technology and OCZ looks a good mix of technology and forceful marketing. Previous star STEC is by no means exhausted or over-the-hill; it would be a mistake to think that. Its early lead has been eroded as SAS and PCIe flash storage has grown in popularity while STEC’s star Fibre Channel interface SSDs have begun to wane – but it still has its controller technology smarts.
- In small/medium business storage, Data Robotics (Drobo) and ProStor (removable drives) are both making progress in their distinctive ways against competition from the majors such as EMC’s Iomega unit.
- For virtualised server storage, both DataCore and Xiotech could prosper.
- Unstructured data protection and management brings us to CommVault, which seems to be thriving while competing against the big guy, Symantec. It also includes Sepaton, energised with a new management team and great performance numbers.
- Let’s not write off tape just yet. SpectraLogic is profitable and growing and Overland Storage, trailing the pack like a sick hound, is making progress and saying tape is ripe for innovation. That would seem almost laughable in some people’s minds, were it not that BlueArc and Data Robotics founder Geoff Barrall is saying it.
- SAN diagnostics could “grow like Topsy” and the John Thompson-led Virtual Instruments, the buyout from Finisair, looks to be almost unassailable and unstoppable.
- High-speed storage from DataDirect Networks and virtualised and tiered file system storage from Quantum (StorNext) could also become much bigger presences in the market, DataDirect particularly.
What about FCoE? It’s early, very early, and until there are complete standards plus compelling cost and simplified management attributes to running Fibre Channel over Ethernet, I can’t see it happening in any big way. If you want to run storage access over Ethernet you can already do it via iSCSI and that, you could argue, will benefit from Converged Enhanced Ethernet just as much as FCoE.
The net result of this could be to let Fibre Channel remain in its hygienic, protected, separate communications fabric as long as it wants, and bring iSCSI into the enterprise data centre: it is already knocking at the door. This matter is a tough issue for Brocade, Emulex and QLogic to deal with.
How about object storage and suppliers such as Caringo? My sense is that that market is just not as hot as it once was. Maybe cloud storage will give it a boost. Equally cloud storage could diminish object storage product sales to end-user customers. It is unclear what will happen.
All the companies I have listed have good technology and hard-driving management. Some are in faster-growing and less heavily contested market niches than others, and have more of a technology advantage over incumbent suppliers. These are the lucky ones. Short-term bets for start-up storage stardom? Here are six: DataDirect Networks, Fusion-io, Nirvanix, Riverbed, Virtual Instruments and Xiotech.®
This is a personal and speculative opinion. Don’t bet your farm or anything else on it. I have shares in CommVault and Overland, so my opinions there could be on the far side of being rosy …
This article originally appeared in The Register.