What’s The Story Behind IBM’s Storage Surge?

IBM’s storage business is on a roll. IBM this week reported 11 percent year-over-year revenue growth for its storage products in the first quarter of 2010. That followed a final quarter of 2009 that saw IBM outperform EMC and Hewlett-Packard and, according to IDC, seize the No. 2 position in the global market. As if to celebrate the momentum, IBM also this week announced new storage products designed to reduce the cost and complexity of storing vast amounts of data while making it easier for clients to apply analytics and gain insight from the data. eWEEK Senior Editor Darryl K. Taft spoke with Brian Truskowski, general manager for storage in IBM’s Systems and Technology Group, about the factors driving IBM’s surge in storage.

Why is storage a big deal for businesses and governments these days?

Truskowski: Data is flowing in from everywhere and straining systems in enterprises of all sizes.  IDC says the world’s data already exceeds available storage space—and demand for storage capacity is growing nearly 60 percent a year. Businesses are struggling with the volume and evolving nature of the data they’re already collecting. They’re under huge pressure to turn this data into insight, and they’re wrestling with how they’re going to store and secure it all. According to Forrester, spending for storage will have the fastest growth in 2010 in the hardware segment.

Companies and governments are making capital investments to address three main challenges: cutting storage costs and making more efficient and reliable use of data; increasing capacity to store data on a massive scale; and categorising and prioritising data to gain insight through analytics. This is why IBM has invested billions over the last few years in storage innovations such as super-efficient grid-based storage arrays such as XIV, data deduplication for the elimination of redundant data copies, scale-out storage to support unstructured file-based data growth, and the Easy Tiering of data to prioritise data for workloads like real-time analytics to gain new insights.

Would you please summarise IBM’s position in the storage market?

As 2009 began, IBM was tied for second place in the storage market. By the end of the year, IBM had pulled ahead of HP to take a clear second spot. IBM also is now the No. 1 storage vendor in China, with 23 percent of the external disk share, and in India, with 31 percent. IBM is either No. 1 or No. 2 in the three main storage segments—tape, disk and storage software—and has been growing in all three. IBM reported first-quarter earnings this week, and storage revenue grew 11 percent year to year. We reported that disk revenue grew 18 percent and gained share, with double-digit growth in enterprise, midrange and low-end products.

What accounts for the growth?

In a simple word: innovation. Helping clients address this data conundrum, IBM’s strategy is provide clients with the innovative products and tools they need for the intelligent management and placement of information without adding complexity. We’re investing both through acquisitions and organic development to drive this innovation in key storage technologies across software and hardware. A particularly key weapon for us has been our acquisition of XIV, a high-end, disk storage system with a virtualised grid architecture designed to eliminate the complexity of storage administration. A lot of our clients say XIV is the easiest storage system they’ve ever installed and managed. IBM added more than 400 new storage customers to our client list based on their choice of the XIV storage platform in 2009, and we are off to a great start in the first quarter of 2010 with an additional 75 new IBM storage clients. We’ve also added deduplication capabilities to the IBM Storage solution set through our acquisition two years ago of Diligent Technologies. So our acquisitions are performing very well as we have ramped their development and sales capacity to fuel growth.

Additionally, we are making multimillion-dollar development investments in high-end file storage, archiving solutions, disk virtualisation and tape density to continue to drive IBM leadership. Our recent achievement of a world record in areal data density on linear magnetic tape—25 billion bits on a single cartridge—is a great example of leveraging IBM research capabilities to break through barriers.